Universities and Innovation Potential of the City: A Quasi-Experimental Study of Newly Built Campuses of Colleges and Universities in China

Colleges and universities have been playing an increasingly important role in regional innovation-driven development. Based on panel data (1999-2016) of 287 cities in China, this study conducted an empirical analysis of the influences of the new campuses which were built for the expanded college enrollment on the city’s patentable inventions and innovations. The Time-varying DID model was adopted in the analysis. The regression results demonstrate that newly built campuses have boosted inventions and innovations in their cities, benefiting various innovators including individuals and firms; that the impact of newly built campuses increases over time; the newly built campuses of vocational colleges have mainly influenced innovation actors like businesses, while those of regular colleges and universities have impacted both individuals and organizations; that the new campus built in the different city from its headquarter exerts greater promoting effects on the innovation of the city than the campus relocated in the original city and the campus of a newly established university; that the indirect effect of newly built campuses on the invention of all innovation actors is more significant than the impact of their direct collaboration with the latter; that a newly built campus have a more prominent effect on regional innovation when it is situated in an area with a high concentration of universities; and that the existence of the old campus of a university amplifies the promoting effect of its newly built campus on local innovation and the amplifying function strengthens over time.