Research On Economic Convergence Of East And West Part Of China Based On Expanding Variety Type Innovation Technology Diffusion Model

The trend of international diffusion of new technologies in form of intellectual property rights (IPR) is inevitable due to intense economic globalization. Therefore issues among innovation, imitation, IPP protection, technology diffusion and economic growth have become the focus of discussion.Current expanding-variety-type R&D-based endogenous growth model can be used to demonstrate the different economic growths between developed countries and developing countries, but it can not explain the unbalanced growths in different parts of a developing country. This paper develops the model by introducing the east-west pattern into north-south framework to make the model more realistic. After solving the equations, the three departments'profit maximization conditions and consumer's utility maximization condition have been obtained, so to the condition which is beneficial for technology development in a developing country. We also acquired the conditions under which IPR protection will cause the economic convergence between western and eastern parts.Taking China for example, we build the empirical analytical framework to justify the points illustrated in the model. Results show that IPR protection keeps on being enhanced year after year in China, and brings on annual increase of total technologies in recent several years. This means that independent innovation has become the main way of technological development of China; and IPR protection has caused the economic convergence between western and eastern parts of China. We predict that in the future 10 years more or less, the influences of IPR protection on economic growths in both eastern and western parts of China will be the same.