Abstract: Based on financial statements of China's manufacturing listed companies, this article builds up a censored regression model with Tobit specification and conducts robustness test, for the purpose of analysing R&D activities. The results then show that factors such as Company Size, Concentration Ratio and Years in Business have a negative impact upon in-house R&D intensity wheras Ratio of Technicians to Total Headcount does the opposite. In addition, other indicators should not be ignored when considering Gross Margin, Inventory Turnover, Cash Ratio, P/S and P/B. To promote innovation and entrepreneurship, we thus encourage Spin-off for the large business and decentralization for the startup company; recommend outsourcing manufacturing and sales job while exploring internal financing options; propose the introduction of Venture and Private Capital with favorable taxation policies.