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Does China Have an “Innovation Paradox”? Evidence from Chinese Colleges and Universities

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  • Feng, Wei
  • Yuan, Hang
  • Shao, Xin

Abstract

Whether an “innovation paradox” exists in the innovation process is worth studying. However, the existing literature has not reached a consensus regarding this. Using data on 547 Chinese colleges and universities from 2005 to 2016, we examine whether greater government intervention in innovation is more likely to stifle innovation. We find that with government-dominated “design innovation,” funding input and personnel input significantly promote innovation output, challenging the “innovation paradox.” The main reason is that they have complementary effects in promoting scientific research innovation. Additionally, personnel input has a more significant effect on innovation than funding input. The role of funding input in promoting innovation becomes less significant, whereas personnel input takes an N-shape relative to innovation. This research enriches the existing literature on China's innovation activities from the perspective of colleges and universities.

Suggested Citation

  • Feng, Wei & Yuan, Hang & Shao, Xin, 2024. "Does China Have an “Innovation Paradox”? Evidence from Chinese Colleges and Universities," Economic Modelling, Elsevier, vol. 134(C).
    • Handle: RePEc:eee:ecmode:v:134:y:2024:i:c:s0264999324000282
    DOI: 10.1016/j.econmod.2024.106672
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    Keywords

    Colleges and universities; Funding input; Innovation output; Paradox; Personnel input;
    All these keywords.

    JEL classification:

    • D61 - Microeconomics - - Welfare Economics - - - Allocative Efficiency; Cost-Benefit Analysis
    • D78 - Microeconomics - - Analysis of Collective Decision-Making - - - Positive Analysis of Policy Formulation and Implementation
    • O31 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Innovation and Invention: Processes and Incentives
    • P35 - Political Economy and Comparative Economic Systems - - Socialist Institutions and Their Transitions - - - Public Finance

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