Policy orientation transformed, factor market distortions and international technology spillover

Abstract

Scientific discoveries, technological achievements and R&D investment are mainly from the developed countries. Developing economies belong to the technical followers and imitators. So, international technology spillover is significant for them. Considering our Chinese policy and market characteristics, the paper selected 1999–2015 Provincial Panel Data, gave an empirical test about the effects of factor market distortions on international technology spillovers before and after policy-oriented. The results showed that the technology spillover effects of the import trade, FDI and patent applications presented different feature in different stages. In the original phase (1999–2007), local governments controlled the resource elements' pricing power leading to factor market distortions, thus weakening and barraging the international spillover effects. In policy orientation phase (2008–2015), government payed more attention to the quality of economic development, the degree of market distortion factors significantly reduced and the role of market mechanism played, international technology spillover got an increase gradually.