New knowledge and regional entrepreneurship: the role of intellectual property protection in China

Abstract

ABSTRACT This research examines the relationship between intellectual property protection (IPP), new knowledge and regional entrepreneurship development in transition China. Using provincial-level panel data collected over China from 2000 to 2017, consistent with conventional wisdom, we find that more investment in new knowledge is the key to encouraging regional entrepreneurship. IPP and entrepreneurship present a U-shaped relationship, that is, IPP first promotes entrepreneurship but impedes entrepreneurship when it exceeds a certain point. IPP negatively moderates the positive effect of new knowledge on entrepreneurship and there are heterogeneous effects in different industries and geographical clusters at different levels of entrepreneurship. New knowledge has a significant incentive effect on necessity-driven entrepreneurship, but not on opportunity-driven entrepreneurship. The moderating effects of IPP on the relationship between new knowledge and necessity-driven entrepreneurship and opportunity-driven entrepreneurship are negative and positive, respectively. These findings contribute to understanding the impact of IPP on entrepreneurial activities in emerging economies.