Regional innovation and performance: The role of absorptive capacity, industrial structure and collaborative networks in the Chinese provinces of Hubei and Hunan

This paper aims to draw on a number of indicators of innovation to evaluate and compare two central regions – Hubei and Hunan – with three leading regions of China – Beijing, Shanghai and Guangdong.

The paper focuses on absorptive capacity at the level of domestic regions of China, using data on R&D expenditures, human resources in higher education and in high-tech industries. The paper uses social network analysis to investigate innovation networks based on patents from the SIPO and USPTO.

Results indicate that, in Hubei and Hunan, R&D expenditures do not translate into as many innovative outputs as in the coastal and Southern regions. Moreover, high-tech industries contribute towards a relatively low proportion of the regional outputs of Hubei and Hunan, where especially the electronics industry is very poorly represented. Findings also suggest that Hubei and Hunan have a relatively limited access to foreign technologies embedded in ties with international partners. By contrast, the more advanced three regions tend to develop collaborative activities across national boundaries to a higher extent than across regional boundaries.

The analysis of China's regional innovation system has implications for research on national innovation systems. Policy-makers can benefit from the comparative analysis of regions.

The study is primarily exploratory, and the findings contribute to the literature and ongoing discussion on data sources and methods for the analysis of regional innovation.