Is R&D helpful for China's energy technology and engineering industry to respond to external uncertainties?

As a core driving force of many industries in China, energy supply is significant for China's economic growth. However, as an old Chinese saying, to do a good job, one must sharpen his device. The energy technology and engineering (ETE) industry should also be focused because it provides advanced technology and equipment to obtain energy resources and improve energy efficiency. Therefore, this paper analyzes China's listed ETE enterprises by evaluating their overall performance in two hierarchies namely operation management and stock performance. By proposing a double hierarchy network model, the two important hierarchies are integrated. Also, the endogenous R&D elasticity for the listed ETE enterprises is investigated. After that, we develop the double hierarchy network with an exogenous disturbance model to generally discuss external impacts on the ETE industry. It is found that the enterprises which are more potential to catch the opportunities to make them survived in the fierce competition when being affected by external uncertainties also show positive endogenous R&D elasticity. They perform also stably in the recent 5 years. Further, we provide the strategies from the perspectives of ETE managers and investors who are interested in this industry. For ETE managers, the strategies are different according to their specific enterprises' situations. Besides, we recommend certain enterprises as investment choices with or without considering any external factors that could impact the ETE industry. More significantly, since specific external uncertainties are difficult to be identified, the exogenous disturbance is generally discussed in this research. • We propose a double hierarchy model to analyze the R&D elasticity of ETE industry. • We empirically study all China's listed enterprises' R&D elasticity in ETE industry. • We conclude that R&D can help ETE enterprise cope with external uncertainty. • Strategies are given for ETE manager and investor to deal with external uncertainty. [ABSTRACT FROM AUTHOR]