| Since the reform and opening up,China's economy has grown at an average annual rate of 10%,ranking the second largest economy in the world.However,China's current economic growth has slowed down significantly,and the driving force of economic growth has declined.China's economy has entered a new normal of"optimal structure,medium-high speed,new power,and multiple challenges",which means that the extensive development method that relies on factor input is no longer sustainable.How to transform the economic growth engine and achieve high-quality economic development is one of the major practical issues that the Chinese government has to face.Realizing the transformation of the growth engine from factor-driven to innovation-driven is the key for the economy to crossing the middle-income trap.Xi Jinping's report at the 19th CPC National Congress clearly states that innovation is the first driving force for development and is the strategic support for setting up a modern economic system.Innovation activities need the support of innovative factors.The improvement of innovation depends on local innovative factors,and the flow of other regional innovative factors(Bai and Jiang,2015).The reason is that,as an important carrier of knowledge,the inter-regional flow of innovative factors can simultaneously accelerate the flow of knowledge and the formation of innovation(Almeida and Kougt,1999;Zhao and Bai,2009).However,the flow of innovative factors is disturbed by many factors,including non-institutional factors represented by natural factors and institutional factors(informal institutions and formal institutions)(Fan,2021).Therefore,how to reduce the flow cost of innovative factors and promote their flow has become a critical issue that needs to considering in facilitating regional innovation.Previous studies have suggested that the main natural factor that affects factor flow is geographical distance(Ji,2020).The typical formal institution that hinders the factor flow includes the household registration system and regional protectionism to maximize local interests(Lu and Chen,2009;Fan et al.,2017).The"cultural barriers"formed by the informal institution of cultural differences are often difficult to detect in reality,so we tend to overlook the hindrance of cultural differences on the factor flow and innovation(Gao et al.,2019).With the considerable construction of China's transportation infrastructure in recent years,the hindrance of geographical factors has gradually weakened.In particular,large-scale construction of high-speed rail networks has dramatically shortened the space-time distance between cities and promoted the factor flow among them.Contemporaneously,with the continuous deepening of reforms,the institution has gradually improved,which is reflected in the decline of institutional market segmentation.Especially,the rapid development of city clusters in recent years has broken the administrative and institutional barriers between cities to some extent,and accelerated factor flow.Moreover,with the promotion of Mandarin,the improvement of human capital,and the large-scale labor flow,the hindrance of cultural differences on the factor flow gradually weakens,which is conducive to the factor flow.The factor flow,especially the inter-regional flow of innovative factors that carry a large amount of knowledge,can speed up the knowledge spillovers and spur innovation activities and performance.Therefore,a natural and realistic question is that the above-mentioned methods eliminate the natural and institutional factors that hinder factor flow,how these may influence knowledge flow between regions and impact China's innovation is uncertain.From the aforementioned analysis and background,based on regional data,enterprise microdata,labor migration data,and patent citation data,this thesis comprehensively explores from three aspects:geographic factors,formal and informal institutions.We examine their impacts on China's innovation through the factor flow channel.This research is conducive to formulating reasonable policies for our country to stimulate the flow of innovative factors,and providing empirical evidence and policy implications for boosting innovation.In this research,this thesis first chooses and analyzes the relevant and typical policies or factors in changing the spatial distribution of China's economy,breaking down administrative and cultural barriers,and in promoting the flow of innovative factors.Then we comprehensively explore the effect of these policies or factors on innovation performance via the flow of innovative factors.Specifically,(1)For geographical factors,high-speed rail(HSR)is regarded as the most important breakthrough in passenger transportation technology in the second half of the 20th century.Since China's rapid development of HSR,it has dramatically reduced the space-time distance between cities and effectively reduced the restrictions of geographical factors on the flow of innovative factors.Therefore,taking HSR connection as a quasi-natural experiment and combing it with the micro-data of labor mobility in China,and the patent citations of listed companies,this thesis deeply explores the impact of changes in human capital flow and knowledge flow between cities caused by HSR connection on urban innovation.(2)For the formal institution,the most prominent feature of current regional development in China is the rapid development of city clusters.City clusters break the market segmentation between cities caused by administrative barriers via government cooperation.Therefore,employing the“Yangtze River Delta urban agglomerations”,the most mature development city cluster in China,we take a city joining in“Yangtze River Delta Urban Economic Coordination Committee”as a quasi-natural experiment of government cooperation,and explore how the knowledge flow generated by such government cooperation affects firm innovation performance.(3)For the informal institution,the most typical fact is that cultural barriers caused by cultural differences impede the factor flow,which is especially true for China.As China has a vast territory and a long history,under the combined effect of many factors,distinctive local dialects have gradually formed,which undoubtedly hinders the factor flow across dialect regions and affects knowledge spillover and the creation of innovation.Therefore,this paper uses the county dialect data within the city to construct the city's language differences to measure cultural differences,and explores its impact on the factor flow and innovation.Finally,combining the background and conclusions,we put forward relevant policy implications conducive to the flow of innovative factors and innovation performance improvement.This thesis is composed of seven parts,and each chapter are organized as follows:Chapter 1 is the introduction.This section briefly introduces the background and research significance.Then we bring forward the research framework,research methods and point out possible innovations.Chapter 2 is concept definition and a review of the theoretical basis.This chapter first brings in the definitions of relevant concepts such as innovation and factor flow and then gives our definitions of these concepts.Second,we comb related theories,and lay a theoretical foundation for the empirical analysis.Chapter 3 is the literature review.We systematically sort out domestic and foreign relevant research.This chapter comprehensively combs the literature from the two aspects:the determinants of factor flow and innovation.Reviewing the existing literature is beneficial to clarify our contributions and lay a literature foundation for the subsequent empirical research.Chapter 4 takes HSR connection as a quasi-natural experiment and combines it with China's prefecture-level cities panel data,China Migrants Dynamic Survey(CMDS),and patent citation data.We examine the effect of HSR on urban innovation from human capital and the knowledge flow channel.Chapter 5 explores the impact of government cooperation on enterprise innovation from the perspective of knowledge flow.Based on the financial data of listed companies in 41 prefecture-level cities in Jiangsu,Zhejiang,Anhui,and Shanghai,and the patent citation data of listed companies,this chapter exploits cities joining the"Yangtze River Delta Urban Economic Coordination Committee"as a quasi-natural experiment of government cooperation to study whether government cooperation is conducive to stimulate enterprise innovation.Chapter 6 studies the impact of language differences on innovation.Referring to the methods of measuring dialect distance between regions,and exploiting the distribution of county dialects within cities,we construct intra-city dialect distance to measure language differences,and discuss its impact on urban innovation and its mechanisms.Chapter 7 is the conclusions and policy implications.This chapter summarizes the main research findings and puts forward corresponding suggestions,shortage of this thesis,and future research directions.The main conclusions are presented as follows:1.HSR connection spurs urban innovation via talent flow and knowledge flow.This paper uses the China Migrants Dynamic Survey and the patent citation data of listed companies to examine these mechanisms.The results show that HSR connection is not only conducive to attracting talents to flow from non-HSR cities to HSR cities,but also helps to enhance the interaction of talents among HSR cities.Moreover,we find that HSR is beneficial for facilitating knowledge flow.2.This thesis exploits cities joining the"Yangtze River Delta Urban Economic Coordination Committee"as a quasi-natural experiment of government cooperation,and the results indicate that government cooperation has indeed effectively improved firm innovation.Mechanism analysis finds that government cooperation promotes knowledge flow between enterprises in the"coordination committee"cities.It also notes that market segmentation caused by local protectionism impedes inter-city knowledge flow.3.Language differences hinder urban innovation,but this hindrance gradually weakens over time.Mechanism analysis shows that although language differences affect urban innovation through language communication,the main channel for the impact on innovation is cultural identity.Furthermore,we find that strengthening the promotion of Mandarin,improving human capital,and increasing inter-group communication can alleviate this adverse effect.The contributions of this thesis are embodied in the following two aspects and are shown as follows:1.The innovations of research perspectives(1)This thesis supplements the relevant literature on factor flow and innovation.The conclusion derived from existing literature reflects the correlation relationship between the factor flow and innovation,and their results exist endogeneity problems.Therefore,exogenous shocks are usually needed to effectively identify their causal effects.The reasons that hinder factor flow can be roughly divided into geographic factors,formal and informal institutional factors.This thesis incorporates the above three factors into a unified framework,and combines China's most prominent typical facts that influence factor flow.By exploiting China's large-scale HSR construction,the development of the Yangtze River Delta urban agglomerations,and local dialects as"quasi-exogenous shocks",this thesis comprehensively examines the influence of geographic factors,formal and informal institutional factors on the flow of innovative factors and innovation performance.Therefore,this thesis is an important supplement for the research on factor flow and innovation.(2)This thesis enriches the research on knowledge spillover.A large body of literature discusses the impact of knowledge spillover from a geographic distance,industrial agglomeration,social attributes,and cultural differences.Although innovation-related theories believe that institutional factors are also important factors affecting knowledge spillover,there is little empirical evidence on the impact of institutional factors on knowledge flow.By using cities joining the"Yangtze River Delta Urban Economic Coordination Committee"as a quasi-natural experiment of government cooperation,and combing with the patent citation data of listed companies,we find that government cooperation is conducive to promoting knowledge flow between the cities of the Coordination Committee.Results confirm that under China's administrative decentralization,local protectionism resulting in market segmentation hinders knowledge flow.(3)This thesis contributes to the relevant research on the determinants of innovation.The"cultural barrier"formed by the informal institution of cultural differences is not easy to be noticed in reality,and the important role of"common language"on the factor flow and innovation is often overlooked.Therefore,there is little evidence on factor flow and innovation from the perspective of cultural differences.We not only dig in depth into examining the impact of language differences on innovation,but also attempt to explore whether the mechanism of language differences affecting innovation is language communication or the cultural identity behind dialects.This analysis provides empirical evidence for academic research on"culture and innovation".2.The innovations of research methods(1)This thesis uses rich micro data.We use several micro data,including China Migrants Dynamic Survey data(CMDS),listed companies'financial and patent citation data,national census data,Classification of Dialects in Chinese Counties data,and Chinese General Social Survey data(CGSS).Therefore,we can evaluate factor flow and knowledge flow from micro perspectives.(2)This thesis identifies the flow of innovation factors and knowledge.In the related research on innovation,especially the literature on HSR and urban innovation,many scholars have explained the results from the human capital flow mechanism.However,as China lacks data on talent flow between cities,existing literature indirectly identifies inter-city talent flow,which cannot accurately capture this effect.This thesis combines China Migrants Dynamic Survey data(CMDS),identifies the direction and scale of talent flow,and examines the effect of HSR on human capital flow.Moreover,we exploit the patent-cited information of the listed company.By employing the addresses of cited patents and citing patents,we clearly depict the inter-city knowledge flow trajectory.(3)This thesis constructs a more precise indicator of language differences.When measuring language differences within a region,previous literature often uses dummy variables,such as whether nationality,race,and religion are the same to reflect cultural differences,or uses the number of dialects in a region to measure language or cultural differences.However,these measurement methods did not distinguish the differences between the different dialects themselves,nor did they consider the number of people using each type of dialect.Therefore,it is often difficult to accurately reflect language differences.When constructing language differences within cities,we not only distinguish the differences between different dialects in a region,but also consider the number of people using each dialect.This indicator can more clearly reflect language differences in a region.(4)This thesis effectively alleviates the endogenous problem.In Chapter 4,drawing on the common practices of existing transportation infrastructure literature,we eliminate large node cities in the HSR route planning.Furthermore,referring to the method of Faber(2014),we construct a minimum spanning tree as the instrumental variable.Chapter 5 selects cities joining the"Yangtze River Delta Urban Economic Coordination Committee"as a quasi-natural experiment of government cooperation.Cities choosing to participate in the"Coordination Committee"is government behavior and is usually not related to the characteristics of enterprises in a city.Therefore,the implementation of this policy is an exogenous impact on enterprises in a city,which can avoid the endogenous problems caused by the reverse causality and omitted variables.In Chapter 6,to solve the possible endogenous problems between language differences and innovation,we learn from the practice of Shao et al.(2017)and use the data of five large-scale population migrations in history to construct an instrumental variable for language differences. |
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