Modeling Regional Innovative System Performance in China Using A Dynamic Two-Stage SBM Model

Abstract

Innovative development has always been an important policy tool for accumulating effective intelligent property to the desirability of all policy makers in China, even more so now as the trade war has seriously threatened the Chinese economy. To understand the efficacy of regional innovative policies, we proposed the dynamic two-stage slacks-based measure (SBM) model with carry-over and intermediate variables, highlighting the importance of the status of invention patent, as granted patent and patent in force, to measure the overall innovative performance for the purposed of regional innovative development, which makes significant difference to previous studies on modelling setting. Using data of 30 provincial administration regions in China for the period of 2011-2017, the average regional innovative system performance is deemed as 0.5858 and we postulated that the difference of commercialization performance among three main areas should be pay attention, because the average performance of commercialization stage in the east area is obviously better than that the west and central areas. Based on this finding, we propose several policy suggestions as the provincial and central government who should be put more efforts on innovative competitiveness, as enhancing the quality and quantity of invention patents and the market-oriented to guild the direction for the R&D stage.