Innovation, network capabilities, and sustainable development of regional economies in China

Abstract

This paper studies the relationships between network capabilities and innovation development in the context of two types of innovation networks: scientific knowledge networks (SKN) and technological knowledge networks (TKN). Focusing on two types of network capabilities, namely acquisition capability and control capability, the paper uses spatial regime models to compare the impacts of multiple factors on different spatial regimes. The main conclusions are the following. First, as regards SKN, the political-administrative hierarchy has shaped the spatial evolution of acquisition capacity, forming a pattern consisting of three dominant cities (Beijing, Shanghai, Nanjing), three subsidiary cities (Guangzhou, Hangzhou, Wuhan), and multiple lesser centers (Tianjin, Chengdu, Xi'an). Moreover, high control capability cities are mainly clustered in the coastal areas, specifically, one monocentric city (Beijing) and two polycentric metropolises (Shanghai,Wuhan). Second, for TKN, cities with high acquisition and control also are mainly found in coastal areas, with Shanghai and Beijing dominating network capabilities. The model's analysis confirms the positive effect of network capabilities on innovation development, especially in scientific knowledge networks, and the driver for regional innovation development appears to have shifted from global pipeline (globalization) to local buzz (localized talents). This paper concludes with suggestions regarding network capabilities' potential to reduce regional inequality and achieve sustainable development of regional economies.