Technological Gap, Innovation Environment and Enterprises’ Independent R&D Intensity*

Fu Xiaoxia 1 and Wu Lixue 2
1 Business School, Central University of Finance and Economics, Beijing, China
2 Institute of Industrial Economics, Chinese Academy of Social Sciences, Beijing, China

 
Abstract: By introducing a knowledge production function which combines both foreign technology imports and domestic research and development (R&D) expenditure into an endogenous technological progress model, this paper examines the mechanism that determines enterprises’ R&D intensity in developing countries, and explores how factors such as technological gap, technology absorptive capacity, innovation environment and innovation ability would impact Chinese enterprises’ decision made on R&D intensity. Our results suggest that technological gap has no significant single impact on enterprises’ R&D intensity, but rather influences enterprises’ decision on R&D jointly with other factors such as degree of openness and human capital. A relative fall in efficiency of technology imitation recently has a negative effect on total R&D intensity but helps to promote enterprises’ independent R&D. In addition, among factors related to R&D innovation environment,  industrial R&D intensity has a significantly positive impact on enterprises’ independent R&D intensity, while regional economies of scale, proportion of large enterprises and proportion of government R&D investment have some certain negative impacts.
Key words: independent R&D intensity, technological gap, R&D environment, innovation ability

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