Advanced Search
MyIDEAS: Login

Foreign competition, domestic knowledge base and innovation activities: Evidence from Chinese high-tech industries

Contents:

Author Info

  • Liu, Xiaohui
  • Hodgkinson, Ian R.
  • Chuang, Fu-Mei
Registered author(s):

    Abstract

    Using panel data analysis for a sample of Chinese high-technology industries from 1998 to 2008, this study examines how industry characteristics affect industry innovation activities. Differing from existing studies, our research considers the impact of foreign competition on innovation activities at industry level in a large emerging economy. The results indicate that the intensity of competition from foreign invested enterprises (FIEs) and domestic skill intensity affect industry buy and make activities. Foreign competition is positively associated with the intensity of buy activity, but negatively affects the intensity of make activity. Further, the findings show that domestic skill intensity weakens the impact of foreign competitive pressure on innovation activities. Our empirical evidence has important policy implications.

    Download Info

    If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
    File URL: http://www.sciencedirect.com/science/article/pii/S0048733313002199
    Download Restriction: Full text for ScienceDirect subscribers only

    As the access to this document is restricted, you may want to look for a different version under "Related research" (further below) or search for a different version of it.

    Bibliographic Info

    Article provided by Elsevier in its journal Research Policy.

    Volume (Year): 43 (2014)
    Issue (Month): 2 ()
    Pages: 414-422

    as in new window
    Handle: RePEc:eee:respol:v:43:y:2014:i:2:p:414-422

    Contact details of provider:
    Web page: http://www.elsevier.com/locate/respol

    Related research

    Keywords: Buy and make innovation activities; Foreign competition; Domestic skill intensity; Chinese high-technology industries;

    References

    References listed on IDEAS
    Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
    as in new window
    1. Eduardo Borensztein & Jose De Gregorio & Jong-Wha Lee, 1995. "How Does Foreign Direct Investment Affect Economic Growth?," NBER Working Papers 5057, National Bureau of Economic Research, Inc.
    2. Ingemar Dierickx & Karel Cool, 1989. "Asset Stock Accumulation and the Sustainability of Competitive Advantage: Reply," Management Science, INFORMS, vol. 35(12), pages 1514-1514, December.
    3. Orietta Marsili & Bart Verspagen, 2002. "Technology and the dynamics of industrial structures: an empirical mapping of Dutch manufacturing," Industrial and Corporate Change, Oxford University Press, vol. 11(4), pages 791-815, August.
    4. Hu, Mei-Chih & Mathews, John A., 2008. "China's national innovative capacity," Research Policy, Elsevier, vol. 37(9), pages 1465-1479, October.
    5. Li, Xibao, 2011. "Sources of External Technology, Absorptive Capacity, and Innovation Capability in Chinese State-Owned High-Tech Enterprises," World Development, Elsevier, vol. 39(7), pages 1240-1248, July.
    6. Rothaermel, Frank T., 2001. "Complementary assets, strategic alliances, and the incumbent's advantage: an empirical study of industry and firm effects in the biopharmaceutical industry," Research Policy, Elsevier, vol. 30(8), pages 1235-1251, October.
    7. Malerba, Franco & Orsenigo, Luigi, 1996. "Schumpeterian patterns of innovation are technology-specific," Research Policy, Elsevier, vol. 25(3), pages 451-478, May.
    8. Castellacci, Fulvio, 2008. "Technological paradigms, regimes and trajectories: Manufacturing and service industries in a new taxonomy of sectoral patterns of innovation," Research Policy, Elsevier, vol. 37(6-7), pages 978-994, July.
    9. Li, Xiaoying & Liu, Xiaming & Parker, David, 2001. "Foreign direct investment and productivity spillovers in the Chinese manufacturing sector," Economic Systems, Elsevier, vol. 25(4), pages 305-321, December.
    10. Brunnermeier, Smita B. & Cohen, Mark A., 2003. "Determinants of environmental innovation in US manufacturing industries," Journal of Environmental Economics and Management, Elsevier, vol. 45(2), pages 278-293, March.
    11. Pavitt, Keith, 1984. "Sectoral patterns of technical change: Towards a taxonomy and a theory," Research Policy, Elsevier, vol. 13(6), pages 343-373, December.
    12. Liu, Xiaohui & Buck, Trevor, 2007. "Innovation performance and channels for international technology spillovers: Evidence from Chinese high-tech industries," Research Policy, Elsevier, vol. 36(3), pages 355-366, April.
    13. Bin, Guo, 2008. "Technology acquisition channels and industry performance: An industry-level analysis of Chinese large- and medium-size manufacturing enterprises," Research Policy, Elsevier, vol. 37(2), pages 194-209, March.
    14. Tang, Jianmin, 2006. "Competition and innovation behaviour," Research Policy, Elsevier, vol. 35(1), pages 68-82, February.
    15. Mariko Sakakibara & Michael E. Porter, 2001. "Competing At Home To Win Abroad: Evidence From Japanese Industry," The Review of Economics and Statistics, MIT Press, vol. 83(2), pages 310-322, May.
    16. Castellacci, Fulvio, 2007. "Technological regimes and sectoral differences in productivity growth," MPRA Paper 27598, University Library of Munich, Germany.
    17. Anabel Marin & Martin Bell, 2006. "Technology spillovers from Foreign Direct Investment (FDI): the active role of MNC subsidiaries in Argentina in the 1990s," Journal of Development Studies, Taylor & Francis Journals, vol. 42(4), pages 678-697.
    18. Liu, Xiaohui & Wang, Chenggang, 2003. "Does foreign direct investment facilitate technological progress?: Evidence from Chinese industries," Research Policy, Elsevier, vol. 32(6), pages 945-953, June.
    19. Ingemar Dierickx & Karel Cool, 1989. "Asset Stock Accumulation and Sustainability of Competitive Advantage," Management Science, INFORMS, vol. 35(12), pages 1504-1511, December.
    20. Glass, Amy Jocelyn & Saggi, Kamal, 2002. " Multinational Firms and Technology Transfer," Scandinavian Journal of Economics, Wiley Blackwell, vol. 104(4), pages 495-513, December.
    21. Francesco Bogliacino & Mario Pianta, 2013. "Profits, R&D, and innovation--a model and a test," Industrial and Corporate Change, Oxford University Press, vol. 22(3), pages 649-678, June.
    22. Mohnen, Pierre & Roller, Lars-Hendrik, 2005. "Complementarities in innovation policy," European Economic Review, Elsevier, vol. 49(6), pages 1431-1450, August.
    23. Ying Li & Wim Vanhaverbeke, 2009. "The Relationships Between Foreign Competition, Absorptive Capacity And Pioneering Innovation: An Empirical Investigation In Canada," International Journal of Innovation Management (ijim), World Scientific Publishing Co. Pte. Ltd., vol. 13(01), pages 105-137.
    24. Giovanni Dosi & Luigi Marengo & Corrado Pasquali, 2006. "How Much Should Society Fuel the Greed of Innovators? On the Relations between Appropriability, Opportunities and Rates of Innovation," LEM Papers Series 2006/17, Laboratory of Economics and Management (LEM), Sant'Anna School of Advanced Studies, Pisa, Italy.
    25. Klevorick, Alvin K. & Levin, Richard C. & Nelson, Richard R. & Winter, Sidney G., 1995. "On the sources and significance of interindustry differences in technological opportunities," Research Policy, Elsevier, vol. 24(2), pages 185-205, March.
    26. Guan, Jiancheng & Chen, Zifeng, 2009. "The technological system of Chinese manufacturing industry: A sectorial approach," China Economic Review, Elsevier, vol. 20(4), pages 767-776, December.
    27. Italo Colantone & Leo Sleuwaegen, 2010. "International trade, exit and entry: A cross-country and industry analysis," Journal of International Business Studies, Palgrave Macmillan, vol. 41(7), pages 1240-1257, September.
    28. Kyoo-Ho Park & Keun Lee, 2006. "Linking the technological regime to the technological catch-up: analyzing Korea and Taiwan using the US patent data," Industrial and Corporate Change, Oxford University Press, vol. 15(4), pages 715-753, August.
    29. Ufuah, Allan N & Utterback, James M, 1997. "Responding to Structural Industry Changes: A Technological Evolution Perspective," Industrial and Corporate Change, Oxford University Press, vol. 6(1), pages 183-202.
    30. Furman, Jeffrey L. & Porter, Michael E. & Stern, Scott, 2002. "The determinants of national innovative capacity," Research Policy, Elsevier, vol. 31(6), pages 899-933, August.
    31. Liu, Feng-chao & Simon, Denis Fred & Sun, Yu-tao & Cao, Cong, 2011. "China's innovation policies: Evolution, institutional structure, and trajectory," Research Policy, Elsevier, vol. 40(7), pages 917-931, September.
    32. Daniele Archibugi, 2001. "Pavitt'S Taxonomy Sixteen Years On: A Review Article," Economics of Innovation and New Technology, Taylor & Francis Journals, vol. 10(5), pages 415-425.
    33. Bruno Cassiman & Reinhilde Veugelers, 2006. "In Search of Complementarity in Innovation Strategy: Internal R& D and External Knowledge Acquisition," Management Science, INFORMS, vol. 52(1), pages 68-82, January.
    34. David L. Carr & James R. Markusen & Keith E. Maskus, 1998. "Estimating the Knowledge-Capital Model of the Multinational Enterprise," NBER Working Papers 6773, National Bureau of Economic Research, Inc.
    35. Loren Brandt & Eric Thun, 2010. "The Fight for the Middle: Upgrading, Competition, and Industrial Development in China," Working Papers tecipa-395, University of Toronto, Department of Economics.
    36. Jacobides, Michael G. & Knudsen, Thorbjorn & Augier, Mie, 2006. "Benefiting from innovation: Value creation, value appropriation and the role of industry architectures," Research Policy, Elsevier, vol. 35(8), pages 1200-1221, October.
    37. Franco Malerba, 2005. "Sectoral systems of innovation: a framework for linking innovation to the knowledge base, structure and dynamics of sectors," Economics of Innovation and New Technology, Taylor & Francis Journals, vol. 14(1-2), pages 63-82.
    38. Dosi, Giovanni, 1988. "Sources, Procedures, and Microeconomic Effects of Innovation," Journal of Economic Literature, American Economic Association, vol. 26(3), pages 1120-71, September.
    39. Ram Mudambi, 2008. "Location, control and innovation in knowledge-intensive industries," Journal of Economic Geography, Oxford University Press, vol. 8(5), pages 699-725, September.
    40. Claudia Goldin & Lawrence F. Katz, 1996. "The Origins of Technology-Skill Complementarity," NBER Working Papers 5657, National Bureau of Economic Research, Inc.
    41. Head, Keith & Ries, John, 2002. "Offshore production and skill upgrading by Japanese manufacturing firms," Journal of International Economics, Elsevier, vol. 58(1), pages 81-105, October.
    42. Filatotchev, Igor & Liu, Xiaohui & Lu, Jiangyong & Wright, Mike, 2011. "Knowledge spillovers through human mobility across national borders: Evidence from Zhongguancun Science Park in China," Research Policy, Elsevier, vol. 40(3), pages 453-462, April.
    43. Kogut, Bruce & Chang, Sea Jin, 1991. "Technological Capabilities and Japanese Foreign Direct Investment in the United States," The Review of Economics and Statistics, MIT Press, vol. 73(3), pages 401-13, August.
    44. Moosup Jung & Keun Lee, 2010. "Sectoral systems of innovation and productivity catch-up: determinants of the productivity gap between Korean and Japanese firms," Industrial and Corporate Change, Oxford University Press, vol. 19(4), pages 1037-1069, August.
    45. Kiley, Michael T, 1999. "The Supply of Skilled Labour and Skill-Biased Technological Progress," Economic Journal, Royal Economic Society, vol. 109(458), pages 708-24, October.
    46. Malerba, Franco, 2002. "Sectoral systems of innovation and production," Research Policy, Elsevier, vol. 31(2), pages 247-264, February.
    47. Lee, Keun & Lim, Chaisung, 2001. "Technological regimes, catching-up and leapfrogging: findings from the Korean industries," Research Policy, Elsevier, vol. 30(3), pages 459-483, March.
    48. Veugelers, Reinhilde, 1997. "Internal R & D expenditures and external technology sourcing," Research Policy, Elsevier, vol. 26(3), pages 303-315, October.
    49. Durham, J.B.J. Benson, 2004. "Absorptive capacity and the effects of foreign direct investment and equity foreign portfolio investment on economic growth," European Economic Review, Elsevier, vol. 48(2), pages 285-306, April.
    50. Malerba, Franco & Orsenigo, Luigi, 1997. "Technological Regimes and Sectoral Patterns of Innovative Activities," Industrial and Corporate Change, Oxford University Press, vol. 6(1), pages 83-117.
    51. Breschi, Stefano & Malerba, Franco & Orsenigo, Luigi, 2000. "Technological Regimes and Schumpeterian Patterns of Innovation," Economic Journal, Royal Economic Society, vol. 110(463), pages 388-410, April.
    52. Daniel Lederman, 2010. "An international multilevel analysis of product innovation," Journal of International Business Studies, Palgrave Macmillan, vol. 41(4), pages 606-619, May.
    53. Veugelers, Reinhilde & Cassiman, Bruno, 1999. "Make and buy in innovation strategies: evidence from Belgian manufacturing firms," Research Policy, Elsevier, vol. 28(1), pages 63-80, January.
    Full references (including those not matched with items on IDEAS)

    Citations

    Lists

    This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

    Statistics

    Access and download statistics

    Corrections

    When requesting a correction, please mention this item's handle: RePEc:eee:respol:v:43:y:2014:i:2:p:414-422. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Zhang, Lei).

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If references are entirely missing, you can add them using this form.

    If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.