Institutions And International R&D Spillovers: Experience From China

Using the provincial panel data of year2001to2010of China, this paper aimed atexploring the effects that regional institutional environment have on international R&Dspillovers. We introduce six indexes, to reduce government intervention on enterprises,the development of non-state-owned economy, the market-oriented process of thefinancial sector, the protection of the legitimate rights and interests of the producers, theprotection of intellectual property rights and the openness, as represents of regionalinstitutional environment. We build econometric models and use the DEA method toanalyze the total factor productivity (TFP) of China and found that technologicaladvances are major driving forces of productivity growth. The regional regressionresults indicate that institutional differences do have effects on international R&Dspillovers and that different institutional environments have different impacts oninternational R&D spillovers.