Impact of Policy Signals on Business Performance: An Empirical Analysis of Financial Subsidy Effects on High-tech Enterprises Using Panel Data from 2095 Listed Companies

Abstract

Based on the samples of A-share listed companies with high-tech certification from 2017 to 2021, this study empirically analyzes the influence of financial subsidy as a "policy signal" on the business performance of high-tech enterprises by analogy with Shannon-Weaver communication model. Using the regulatory effect model and intermediary effect model, and with the help of soft budget constraint and diminishing marginal revenue theory, this study analyzes the reasons why financial subsidy affects the enterprise business performance differently. This study indicates that financial subsidy, as a kind of policy signal source, is regulated by the nature and scale of enterprises, and ultimately improves the financial performance and innovation performance of enterprises through the intermediary effect of R&D investment intensity and external market valuation.