The Role of Research and Development Investment in Company Growth: Empirical Evidence based on the Guangzhou Region

Zhang Gang; Julie Ann U. Abellera

doi:10.6981/FEM.202409_5(9).0015

Authors

Zhang Gang
Julie Ann U. Abellera

DOI:

https://doi.org/10.6981/FEM.202409_5(9).0015

Keywords:

R&D Investment; Company Growth; Regional Economy; Sustainable Operation.

Abstract

Research and development (R&D) are becoming increasingly crucial as the advent of the dual carbon era ushers in a new round of technological revolution, placing enormous pressure on various industries. In response to potential industry reshuffling and industrial chain restructuring, enterprises are intensifying their focus on R&D, resulting in a massive surge of activity. However, is it necessary for all industries to participate? Can all R&D investments drive business growth? This article selects data from manufacturing enterprises in Guangzhou, the holy land of China's reform and opening up, from 2012 to 2022 to empirically demonstrate that R&D investment has not brought expected results and is negatively correlated with enterprise growth. This conclusion serves as a warning to businesses in panic and following the trend. This has important reference significance for corporate governance and scientific decision-making.

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