Abstract: There exists a quite big difference in R&D strategy between enterprises with high degree of product diversification and ones with a single product, which may influence the performance of the subsidy policy. Under this background, using the data of the non-financial listed companies consecutive trading for eight years from 2008 to 2015 on the Shanghai Stock Exchange and the Shenzhen Stock Exchange, this article studies the impact of China's R&D subsidy policy on corporate R&D investment, and whether the product diversification affects the performance of the R&D subsidy policy. The empirical results show that higher the degree of enterprise product diversification is, worse the performance of R&D subsidy will be. It enlightens us that in order to improve the overall performance of R&D subsidy policy, we should reduce the subsidy for enterprises with high degree of product diversification. The result can help to scientifically and rationally develop R&D subsidy policy.

Key words: enterprise R&, D investment