Technology Importation and Domestic Technology Acquisition in China from the Perspective of Innovation

Yu Liping 1 , Yuan Shengjun 2 , Peng Changsheng 3 and Zhong Changbiao
1 School of Statistics and Mathematics (SSM), Zhejiang GongShang University, Hangzhou, China
2 Business school, Guilin University of Electronic Technology (GUET), Guilin, China
3 School of Economics and Management, Anqing Normal University, Anqing, China
4 Business School, Yunnan University of Finance and Economics, Kunming, China

Abstract: Foreign and domestic technologies play different roles in a country’s innovation. In recent years, Chinese firms have spent less on importing foreign technology and more on acquiring domestic technology. Based on the panel data model, state space model (SSM) and the Bayesian vector autoregressive model, this paper finds that the purchase of domestic technology plays a critical role in the innovation of high-tech firms with an elasticity coefficient higher than that of technology importation before 2010. China’s high-tech firms can effectively absorb purchased domestic technology, which also brings about an increase in their independent R&D input and contributes more to innovation output than imported technology. Performance of technology importation is lackluster but shows an improving trend. Technology importation is not correlated with innovation output and has a substitutive effect with independent R&D input. China is yet to enhance its absorption of imported technology. Elasticity coefficient of technology importation turned positive in 2007 and increased year by year. China should promote synergy between technology importation and domestic technology acquisition.

Keywords: technology importation, acquisition of domestic technology, innovationdriven development, state space model (SSM), Bayesian vector autoregressive model

JEL Classification Codes: L60
DOI:1 0.19602/j .chinaeconomist.2019.5.05

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