This study evaluates the impact of Chinese government policies on private R&D investment in biotechnology. We apply survey data from 160 major agribusinesses to analyze the effects of various factors on firm R&D activities. Our findings provide evidence of inducement effects of government policy on firms R&D investment. Significant drivers of Chinese agribusiness firms decisions to invest in biotechnology R&D are public R&D subsidies, owning patents by firms, selling biotechnology products, and expectations of positive profit from commercialization of biotechnology crops. Firms collaboration with universities has no significant impact. Government R&D subsidies also significantly increase firms' biotechnology R&D investment spending. Acknowledgement : We thank the MOA, Seed Industry Association, and Agricultural Department of Zhejiang Province for helping with data collection. This research was supported by the National Natural Science Foundation of China (71210004).This research was supported by the National Natural Science Foundation of China (71210004).