Globalization, Innovation and Productivity in Manufacturing Firms: A Study of Four Sectors of China

Jacques Mairesse, Pierre Mohnen, Yanyun Zhao and Feng Zhen
Additional contact information
Yanyun Zhao: Yanyun ZHAO Renmin University of China
Feng Zhen: Feng ZHEN Bank of China, and Chinese Academy of Social Science

No DP-2012-10, Working Papers from Economic Research Institute for ASEAN and East Asia (ERIA)

Abstract: This paper investigates relationships between innovation input, innovation output and labor productivity in China for four major manufacturing sectors; textiles, wearing apparel, transport equipment and electronic equipment. It uses a large sample of firm level micro data and a structural model in the estimation. The data from 2005 to 2006 is estimated, and results of all the sectors show positive effects from innovation input to output, and then to firm performance. Globalization has various impacts on innovation, through exports. It has a positive effect on both the decision to carry out R&D, and intensity of R&D input in sectors with competitive advantage, such as textiles and transport equipment, but not in sectors with high levels of overseas capital control, such as electronic equipment and wearing apparel. Ownership reveals the same story in different sectors, namely that foreign firms tend to do less in innovation input and output, but they do have higher level of productivity. Moreover, market share, subsidy, firm size and other characters of firms are involved in the estimation, which explains significant difference in engaging in innovation and production. Thus, in all the sectors, market share improves R&D input, continuous R&D input and exports improve new products output. Subsidy sustains R&D input, but not innovation output.

Pages: 34 pages.
Date: 2012-06-01
New Economics Papers: this item is included in nep-cse, nep-eff, nep-ino and nep-tra
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (15)

Downloads: (external link)
http://www.eria.org/ERIA-DP-2012-10.pdf (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:era:wpaper:dp-2012-10

Access Statistics for this paper

More papers in Working Papers from Economic Research Institute for ASEAN and East Asia (ERIA) Contact information at EDIRC.
Bibliographic data for series maintained by Ranti Amelia ( this e-mail address is bad, please contact ).