Regions and Innovation: A New Tale of Three Economic Regions in China

Megan Yuan Li, Shige Makino, Michael Murphree and Chunyan Jiang “Regions and Innovation: Evidence from Three Economic Regions in China” International Journal of Innovation Management. (Forthcoming)

45 Pages Posted: 10 Feb 2021 Last revised: 11 Feb 2021

See all articles by Yuan Megan Li

Yuan Megan Li

Nanjing University of Aeronautics and Astronautics

Shige Makino

The Chinese University of Hong Kong (CUHK) - Department of Management

Michael Murphree

University of South Carolina

Chunyan Jiang

Nanjing University

Date Written: December 4, 2020

Abstract

Learning is a key component of firm upgrades in emerging economies, and China is no
exception. Studies have identified two critical mechanisms that facilitate learning: 1)
connections with supportive local governments that enhance access to resources or publicly
funded knowledge and 2) connections to foreign MNEs that enhance access to advanced
knowledge and capabilities. Previous studies of the effects of these connections on learning
and innovation have had contradictory results. In this study, we develop a model of firm
innovation capabilities based on regional differences in firms’ dependence on government and
MNEs. Using a sample of 715 indigenous firms from the three historically dominant economic
regions in China, we find that the impacts of government and MNE ties on local firms’
exploratory learning and innovation performance vary depending on the historically dominant
dependency patterns in the region.

Keywords: Resource dependency theory; regional innovation systems; exploratory learning; Chinese economy

JEL Classification: O33, M16, F23, L38

Suggested Citation

Li, Yuan (Megan) and Makino, Shige and Murphree, Michael and Jiang, Chunyan, Regions and Innovation: A New Tale of Three Economic Regions in China (December 4, 2020). Megan Yuan Li, Shige Makino, Michael Murphree and Chunyan Jiang “Regions and Innovation: Evidence from Three Economic Regions in China” International Journal of Innovation Management. (Forthcoming), Available at SSRN: https://ssrn.com/abstract=3732575 or http://dx.doi.org/10.2139/ssrn.3732575

Yuan (Megan) Li

Nanjing University of Aeronautics and Astronautics ( email )

Yudao Street
Nanjing,
China

Shige Makino

The Chinese University of Hong Kong (CUHK) - Department of Management ( email )

Shatin, N.T.
Hong Kong
+852 2609 7636 (Phone)
+852 2603 6840 (Fax)

Michael Murphree (Contact Author)

University of South Carolina ( email )

United States

Chunyan Jiang

Nanjing University ( email )

Nanjing, Jiangsu 210093
China

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