Open Access Journal Article

Performance Negative Feedback and Firm's R&D Efficiency: Moderating Roles of Regional Institutional Environment

by Furong Guo a,* Yiwen Xiang a  and  Pan Wang a
a
School of Accounting, Chongqing Technology and Business University, Chongqing, China
*
Author to whom correspondence should be addressed.
Received: 12 July 2024 / Accepted: 5 September 2024 / Published Online: 14 January 2025

Abstract

Based on the behavioral theory of the firm, we investigate the impact of performance negative feedback on R&D efficiency. The results show that when performance falls below aspirations, firms pay more attention to R&D projects with high R&D efficiency to get rid of the operating pressure, reputation pressure and resource constraints caused by the decline in performance. This effect may be influenced by institutional differences. In the case of negative feedback, a good regional institutional environment is conducive to the improvement of R&D efficiency, while a weak regional institutional environment weakens this effect. Specifically, the higher the degree of IPR enforcement and financial market development, as well as the lower the degree of local government intervention, the more inclined firms are to increase R&D efficiency. The findings provide insights into understanding R&D efficiency improvement in the context of emerging markets.


Copyright: © 2025 by Guo, Xiang and Wang. This is an open-access article distributed under the terms of the Creative Commons Attribution License (CC BY) (Creative Commons Attribution 4.0 International License). The use, distribution or reproduction in other forums is permitted, provided the original author(s) or licensor are credited and that the original publication in this journal is cited, in accordance with accepted academic practice. No use, distribution or reproduction is permitted which does not comply with these terms.

Funding

Chongqing Social Sciences Planning Fund (2021BS084) , Humanities and Social Science Research Fund of Chongqing Education Commission (23SKGH181) , Chongqing Technology and Business University High-level Talent Introduction Fund (2255006) , Chongqing Social Sciences Planning Fund (2023BS041)

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ACS Style
Guo, F.; Xiang, Y.; Wang, P. Performance Negative Feedback and Firm's R&D Efficiency: Moderating Roles of Regional Institutional Environment. Review of Economic Assessment, 2024, 3, 37. https://doi.org/10.58567/rea03030004
AMA Style
Guo F, Xiang Y, Wang P. Performance Negative Feedback and Firm's R&D Efficiency: Moderating Roles of Regional Institutional Environment. Review of Economic Assessment; 2024, 3(3):37. https://doi.org/10.58567/rea03030004
Chicago/Turabian Style
Guo, Furong; Xiang, Yiwen; Wang, Pan 2024. "Performance Negative Feedback and Firm's R&D Efficiency: Moderating Roles of Regional Institutional Environment" Review of Economic Assessment 3, no.3:37. https://doi.org/10.58567/rea03030004
APA style
Guo, F., Xiang, Y., & Wang, P. (2024). Performance Negative Feedback and Firm's R&D Efficiency: Moderating Roles of Regional Institutional Environment. Review of Economic Assessment, 3(3), 37. https://doi.org/10.58567/rea03030004

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