Knowledge source switching under state interventions of latecomer regions: A case study of Shenzhen

This paper aims to unpack the process and analyze the mechanisms of knowledge source switching in latecomer regions that have evolved from peripheral to core positions. Drawing on four decades of matched patent-company data from Shenzhen, we classify patents into various knowledge classifications and calculate their percentage changes to observe the dynamics of knowledge source switching. Furthermore, we employ Difference-in-Differences (DiD) estimation to examine the causal effects of state interventions on this dynamic. The findings indicate that Shenzhen's knowledge sources have switched from multinational corporations (MNCs) and foreign subsidiaries to global inventors. Notably, state interventions exhibit a significant positive causal effect on this dynamic, particularly following the implementation of independent innovation policies. These findings contribute to the cross-fertilization of regional innovation studies and the Global Production Networks (GPN) approach, highlight the critical role of the state in ensuring the right and dynamic mode of global knowledge sourcing and offer implications for local innovation policies in latecomer regions.