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Firm Location And Innovation: Evidence From Chinese Listed Firms

Author

Listed:
  • JIAN XU

    (Robert C. Vackar College of Business and Entrepreneurship, The University of Texas Rio Grande Valley, TX 78539, USA)

  • XI YANG

    (Business Management, East Stroudsburg University of Pennsylvania, PA 18301, USA)

  • DAQI XIN

    (Lally School of Management, Rensselaer Polytechnic Institute, NY 12180, USA)

  • WENCANG ZHOU

    (Feliciano School of Business, Montclair State University, 1 Normal Ave, Montclair, NJ 07043, USA)

  • XIAOYANG ZHU

    (Spears School of Business, Oklahoma State University, OK, USA)

Abstract

Matching city-level and province-level GDP data with firm headquarters’ locations for a sample of Chinese listed firms from 2003 to 2015, we find that firm locations are positively and significantly associated with firm innovation. In addition, firms with higher government grants have higher R&D inputs. The gap between firms’ innovation performance in ordinary cities and in non-ordinary cities is not significant in the eastern region; however, the gap is significant in the central and western regions of China. Finally, we use firm relocation to tackle the endogeneity issue and find that firms relocated to cities with larger size of economy are associated with higher innovation performance.

Suggested Citation

  • Jian Xu & Xi Yang & Daqi Xin & Wencang Zhou & Xiaoyang Zhu, 2019. "Firm Location And Innovation: Evidence From Chinese Listed Firms," Journal of Developmental Entrepreneurship (JDE), World Scientific Publishing Co. Pte. Ltd., vol. 24(04), pages 1-20, December.
    • Handle: RePEc:wsi:jdexxx:v:24:y:2019:i:04:n:s1084946719500262
    DOI: 10.1142/S1084946719500262
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    Cited by:

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    3. He, Xinao & Xu, Runguo & Sun, Kai & Wang, Jian, 2024. "Population intensity, location choice, and investment portfolio selection: A case of emerging economies," International Review of Financial Analysis, Elsevier, vol. 94(C).

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