Abstract:R&D competition poses new challenges for the government to choose appropriate innovation subsidy policies. The article divides the government's price subsidy policy into three types: non-subsidies, subsidies for products with high consumer valuations, and subsidies for products with low consumer valuations, and establishes a multi-agent game model that considers the characteristics of innovation activities in a R&D competitive environment. The optimal strategy of government price subsidies in the process of encouraging social innovation and its impact on corporate innovation behavior are discussed. The study found that 1) the intensity of competition and the characteristics of innovative activities are important factors that determine the conditions for applying subsidy policies. When the subsidy policy matches the applicable conditions, social welfare increases, and vice versa, social welfare decreases; 2)the government's price subsidies can create a situation where competing R&D companies lose sight of the other, but all price subsidies can help increase the expected returns of producers; 3)the impact of subsidies on consumer surplus is related to the specific subsidy amount.