How does resource dependence relate cities' technology diversification? The role of density and complexity

Abstract

This study investigates the relationship between resource dependence and technology diversification with a territorial perspective, considering heterogeneity of different technologies, based on the patent application data of 641 categories in 341 cities in China. Using a linear probability model with fixed effects, the result shows that regional natural resources dependence is negatively related to the probability of diversifying into new technologies and the growth of a technology, providing evidence of “resource curse”. However, the probability of diversifying into less related and more complex technology spaces is less likely to be hindered by reliance on natural resources. Cities with higher complex knowledge structure are inclined to develop new technologies, and also experience a less negative effect of resource dependence on the probability of entering new technology space. Moreover, for technologies of different position in a city, reliance on natural resource also affects their growth distinctively. This study provides significant policy implications for the development of resource-dependent cities and the transformation of old industrial regions. Governments can manage existing resources to make a strategy and develop technical fields that have higher complexity or lower relatedness, which is vital to convert resource curse to resource blessing, thereby improving the sustainability and productivity of resource use.