Abstract The low efficiency of social resource allocation caused by the planned economic system provides a starting point for the implementation of balanced innovation for Chinese enterprises. And with the balanced innovation caused by Pareto improved space gradually reduced, the use of nonbalanced innovation to promote the efficiency of resource use jump which has been urgent. In the implementation of the current national innovation strategy, the government can easily invade the boundaries of the social main innovation activities, resulting in the reduction or dissipation of innovation rents. The government's financial support to the innovation activities makes the innovation funds appear soft budget constraints, reduce the innovation efficiency, and increase the risk appetite of the innovation subject, amplify the innovation system risk, easily lead to capture the government behavior which leading to the reverse elimination of innovation. Therefore, it is very important to correctly understand the boundaries and risks of government in innovation activities and to promote China's innovation strategy.