Measuring the Knowledge-Based Economy of China in terms of Synergy among Technological, Organizational, and Geographic Attributes of Firms

TL;DR

This paper assesses China's knowledge-based economy by analyzing synergy among geographic, technological, and organizational attributes of firms, revealing regional disparities and methodological approaches for future research.

Contribution

It introduces a methodology to measure synergy in regional innovation systems using firm-level data, applicable even with incomplete datasets.

Findings

Greatest uncertainty reduction at provincial level in China

Metropolitan areas like Beijing and Shanghai show high synergy

Methodology adaptable to other datasets with higher quality

Abstract

Using the possible synergy among geographic, size, and technological distributions of firms in the Orbis database, we find the greatest reduction of uncertainty at the level of the 31 provinces of China, and an additional 18.0% at the national level. Some of the coastal provinces stand out as expected, but the metropolitan areas of Beijing and Shanghai are (with Tianjan and Chonqing) most pronounced at the next-lower administrative level of (339) prefectures, since these four metropoles are administratively defined at both levels. Focusing on high- and medium-tech manufacturing, a shift toward Beijing and Shanghai is indicated, and the synergy is on average enhanced (as expected; but not for all provinces). Unfortunately, the Orbis data is incomplete since it was collected for commercial and not for administrative or governmental purposes. However, we show a methodology that can be used by others who may have access to higher-quality statistical data for the measurement.