Technology Spillovers Research Articles

A Game-Theory-Based Contract Mechanism to Facilitate Technology Spillover in Emerging Electric Vehicle Markets

Electric vehicles (EVs) have been increasingly adopted by both developing and developed countries as an effective means to cope with energy shortage and provide environmental-friendly transportation solutions. However, due to technology gap, domestic electric vehicles (DEVs) in developing countries often cannot compete with well-established imported electric vehicles (IEVs) from developed countries. Therefore, developing countries often face the dilemma of increasing the EV adoption through more IEVs and promoting the development of DEVs. This article proposes an incentive-compatible contract mechanism to address this dilemma. Through a set of game theory models, we compare the commonly used subsidy and tariff policies against the spillover effect of a technology assistance program (TAP) and derive the optimal pricing strategies for DEVs and IEVs. The results show that the implementation of TAP can lead to a more competitive market and significantly increase social welfare. Consumers can benefit from reduced prices of both the DEVs and IEVs, while the profits of the IEVs and DEVs can be enhanced at varying degrees of technology spillover resulted from TAP. Therefore, the proposed TAP mechanism effectively complements the existing subsidy and tariff policies and provides a viable instrument for the government of developing country to reconcile the existing policy dilemma.

Research on the Influence of FDI on China’s Economic Innovation Development

Foreign direct investment (FDI) and outward foreign direct investment (OFDI) are the primary methods through which capital moves internationally. They serve as significant conduits for technological spillover, which is vital for the progress of countries and regions. Through the combined impact of the growth in foreign direct investment and the two-way flow of FDI, China may enhance its access to various production resources, including labor, capital, and energy. Additionally, this enables China to improve the distribution of intangible assets such as knowledge and technology. Consequently, there is an urgent need to establish and implement a strategy that prioritizes innovation-driven development.This study utilizes China’s provincial panel data from 2000-2020 to examine the relationship between the expansion of foreign direct investment (FDI) and the level of innovation. The regional innovation index is used as the dependent variable, while the FDI scale is used as the independent variable. Additionally, a model is employed to test the impact of China’s FDI scale expansion on regional innovation capacity. Simultaneously, this study takes into account the disparities in development between the eastern region and the central and western regions, as well as the influence of the Pilot Free Trade Zone policy. Consequently, the sample is further categorized into the eastern region, central region, and western region for a more detailed analysis. Relevant countermeasures are provided based on the results of the empirical analysis mentioned above.

Technology Spillover Effects and Patent Announcements

Technology Spillover Effects and Patent Announcements

Does Imported Product Variety Improve Enterprises’ Energy Efficiency? ——Based On The Total Factor Method

Abstract Based on the total factor method, this paper explores the relationship between imported product variety and enterprises’ energy efficiency by using Statistics from China. The study finds that the types of imported products considerably improve the energy efficiency of enterprises. After accounting for endogeneity, changing test methods, and using different measures, the core conclusion remains valid. Mechanism tests indicate that the technology spillover effect and competition effect are two important channels through which imported product variety enhances enterprises’ energy efficiency. Heterogeneity test results show that the types of imported products have a greater impact on improving energy efficiency.

Impact and Spatial Effect of Socialized Services on Agricultural Eco-Efficiency in China: Evidence from Jiangxi Province

Agricultural eco-efficiency (AEE) is a crucial indicator of the green development of agriculture. Agricultural socialized services (AS) provide services for the agricultural production process and they promote the effective input of production factors, such as science and technology, talent, information, and capital, into the agricultural production chain, deepening the division of labor and injecting vitality into agricultural development. We measured AEE based on field research data in Jiangxi Province, China. We also constructed an endogenous switching model to explore the impact of AS on AEE. Our results show that, based on the counterfactual assumption, the AEE increased by 13.19% among farmers who adopted the services compared to those who did not. From the perspective of scale and structural differences, the larger the scale of agricultural cultivation, the stronger the impact of AS on AEE. Furthermore, a large share of cash crops was found to inhibit the impact of AS on AEE. We also investigated whether farmers in close proximity to each other affect their neighbors through knowledge dissemination and technology spillover. The extent of the impact of AS on AEE depended on distance thresholds: it was more pronounced when we increased the distance threshold. Our results suggest that the government should improve the AS system, provide more public welfare services, and appropriately subsidize AS organizations. The AS for food crops should be emphasized; however, those for cash crops should not be ignored.

Bringing the knowledge spillover theory of entrepreneurship to circular economies: Knowledge and values in entrepreneurial ecosystems

Transitioning from a linear economy to a circular economy (CE) supports the realisation of societal values towards more sustainable development. This article identifies mechanisms by which circularity can be embedded in entrepreneurial ecosystems (EEs) through the flow of relevant knowledge and values. It presents a dynamic model that illustrates how reverse knowledge spillovers from entrepreneurs can complement traditional technological knowledge spillovers from incumbents, ultimately advocating for CE values and validating circular knowledge. The validated circular knowledge, in turn, alters the knowledge filter of incumbents, leading to shifts in their research and development (R&D) focus and their willingness to embrace new knowledge. This symbiotic relationship of knowledge spillovers between circular start-ups and incumbents can significantly enhance the motivation of participants in EEs to adopt CE values and leverage circular knowledge. Overall, the article shows how knowledge spillovers can facilitate a wider adoption of circular knowledge and CE values within EEs.

Outward foreign direct investment and GVC position of manufacturing industry: A perspective on China's general trade and processing trade structure.

Depending on the trading modes, the effect of Outward Foreign Direct Investment (OFDI) on the manufacturing industry's position within the global value chain (GVC) may differ considerably. This paper examines the GVC position of China's manufacturing industry from 2003 to 2018, specifically focusing on the general trade and processing trade. Drawing upon this premise, this paper analyzes the effect and mechanism by which OFDI influences the GVC position of China's manufacturing industry. The result demonstrates that: (1) China's processing trade manufacturing industry has a much lower GVC position than general trade manufacturing industry. The GVC position of China's general trade manufacturing industry rose from 2.76 to 2.90 from 2003 to 2018, while processing trade manufacturing industry remained around 1.93. (2) OFDI boosts the GVC position of general trade manufacturing industry through facilitating reverse technology spillover, inducing industry structure upgrading, and enabling export scale expansion. (3) OFDI hinders the GVC position growth of processing trade manufacturing industry. The research findings offer theoretical backing for China to develop OFDI strategies that are tailored to different trading modes within the new framework of dual circulation. These strategies aim to facilitate the transformation and advancement of the manufacturing industry, as well as the growth of the GVC position.

Innovation and OFDI along the Belt and Road

Outward foreign direct investment (OFDI) has become an important strategy for enhancing firms' innovation capabilities through the reverse technology spillover effects from overseas innovation experience. The extant research on the effect of OFDI on innovation has focused primarily on developed economies, while the influence of OFDI in developing countries has remained relatively unexplored. The major Belt and Road Initiative (BRI) encourages Chinese firms to invest in Belt and Road (BR) countries—mainly developing nations. We investigate the impact of BR OFDI on Chinese firms' innovations and its influencing mechanisms. The main findings are as follows. First, BR OFDI has a positive effect on innovation by increasing R&D spending and returns on investments in overseas subsidiaries. Second, the number of research-driven subsidiaries has a positive moderating effect on innovation. Finally, the BR ODFI innovative effect is stronger after the launch of the BR initiative in 2013 and more significant for nonstate-owned enterprises. Our research has theoretical significance by uncovering the overseas return mechanism and the moderating effects of investment depth and motivation on the impact of BR OFDI on innovation—topics rarely explored in the OFDI literature. These research findings have practical implications for governments designing effective policies to promote BR OFDI activities and for firms developing robust OFDI investment strategies along the Belt and Road to improve their innovation performance.

Public attention, big data technology, and green innovation efficiency: empirical analysis based on spatial metrology

This study employs the undesirable output super-efficiency SBM-DEA model to reassess the green innovation efficiency (GIE) of 30 Chinese provinces from 2011 to 2020. We pioneer the examination of public attention (PA) influence on GIE and spatial spillover effects, employing the spatial Durbin model. Additionally, a spatial mediation model, incorporating big data technology as a mediator, is adopted. Key findings are as follows: 1) Significant spatial correlations exist in PA and GIE. 2) Improved PA in one province can help enhance the GIE in neighboring provinces but cannot directly impact the local GIE. 3) The positive impact of PA on local GIE follows an indirect path. Specifically, PA elevates the level of big data technology in the local and neighboring provinces, and this positive technological spillover effect significantly enhances the GIE across the entire region. 4) Industrial structure and research and development intensity also influence GIE to some extent.

Green links: corporate networks and environmental performance

Abstract We investigate the propagation of environmental performance among competitors and in customer–supplier relationships. We find a significant causal effect among competitors, while the propagation from customers to suppliers and vice versa appears insignificant or does not survive identification tests. The effect is stronger among firms in highly concentrated competitor networks and toward firms with less market and bargaining power than their competitors. We also find significantly stronger propagation of environmental performance among competitors engaged in joint research and development activity. These results show that the propagation stems from both competitive pressure and technological spillover. Importantly, we find that propagation is strong when the competitor improves its environmental performance and when the firm’s own environmental performance is poor initially, alleviating concerns that improvements in performance are concentrated among firms, which are already green. Overall, network effects among competing firms are a significant force shaping environmental performance, and a force mostly for good.

Study on the impact of smart energy on carbon emissions in smart cities from single and holistic perspectives – Empirical evidence from China

Smart energy, as an important component of smart cities and directly related to carbon emissions, plays a crucial role in smart cities to achieve carbon neutrality, but the theoretical research and empirical evidence on the impact of smart energy on carbon emissions in smart cities are limited. This paper investigates, from single and holistic perspectives, the effect of smart energy on smart city carbon emissions and potential mechanisms. Based on the panel data of 100 smart cities in China from 2014–2019, it uses synthetic difference-in-difference mode and spatial difference-in-difference mode to estimate the carbon emission reduction effect and test the potential mechanisms. The results show that: (1) Smart energy reduces carbon emissions in smart cities by an average of 5.65 %. (2) Smart energy reduces smart city carbon emissions mainly through mechanisms including optimizing energy structure and improving energy efficiency. (3) Smart energy in smart cities has a significant spatial carbon emission reduction effect. (4) Smart energy in smart cities influences holistic regional carbon emissions through spatial mechanisms including technology spillover, peer effect, and scale effect. Finally, this study provides quantitative evidence and valuable insights for cities in developing countries with similar backgrounds to China to design emission reduction paths and adjust smart city strategies.

Implementation of industrial enterprises’ green innovation strategy under technology spillover

ABSTRACT In recent years, advanced emerging technologies have paved the way for new opportunities in green innovation strategies within industrial enterprises. This research aims to examine the impact of technology spillover on the strategic management of industrial enterprises’ green innovation initiatives and evaluate the role of government intervention. By employing an evolutionary game model and simulation approach, we identify a direct relationship between industrial enterprises’ strategic choices in green innovation and the degree of technology spillover. With significant technology spillover, industrial enterprises demonstrate an increased tendency to access innovation resources and technical support, leading to a preference for breakthrough green innovation strategies. Enhanced innovation capabilities and a higher innovation cost elasticity coefficient help reduce the risks associated with breakthrough green innovation, further amplifying the positive effects of technology spillover on such initiatives. Moreover, when the government provides considerable cost subsidies and incentive funds, industrial enterprises show a stronger predilection towards breakthrough green innovation strategies. This research adds to the body of knowledge concerning technology analysis, strategic management of green innovation, and the sustainable progression of industrial enterprises.

Renewable technology adoption costs and economic growth

In the presence of rapid technological progress, early technology adoption may result in large capital replacement costs. We develop an analytical Integrated Assessment Model that incorporates endogenous scrapping costs resulting from new technology adoption in renewable energy, as well as externalities associated with carbon emissions and renewable technology spillovers. We use our calibrated model to investigate the effects of the scrapping channel on renewable technology adoption and on the optimal energy transition. In the absence of a Pigouvian carbon tax, a second-best policy that incentivizes renewables through internalizing spillovers provides relatively small benefits and can even be detrimental to short-run growth. In contrast, the reduction in fossil fuel consumption resulting from internalizing technology spillovers is significantly larger if the Pigouvian tax is also in place. Comparing the status quo to the scenario where both policies are implemented results in a consumption-equivalent welfare gain of 1.4 percent. Our findings suggest that, in the presence of scrapping costs resulting from rapid technological progress, some caution might be warranted before concluding that direct subsidies are a suitable substitute for a Pigouvian carbon tax. When it comes to social welfare, carbon taxes and policies that promote renewables by eliminating spillover externalities are best thought of as complements rather than substitutes.

How does manufacturing servitization effect global value chain upgrading? Tests based on the dual perspectives of “participation” and “division position”

Manufacturing servitization has become an important trend in the development of global manufacturing. Under the policy goal of global value chain upgrading, it is of great significance to discuss how manufacturing servitization affects the participation and position in global value chains (GVCs). Based on the OECD Input-Output Tables (OECD-ICIO) from 2008 to 2018, we calculate the level of manufacturing servitization in major economies. At the same time, based on the TIVA database, two indicators reflecting the upgrading of the global value chain are calculated from the dimensions of “participation” and “division position”. This paper empirically examines the mechanism and effect of manufacturing servitization on the upgrading of GVCs. Our findings reveal the following: (1) Manufacturing servitization has a significant enhancement effect on global value chain upgrading. (2) Manufacturing servitization can affect the upgrading of GVC through “cost reduction effect, technology spillover effect and specialization effect”. (3) Manufacturing servitization in developing countries has a greater promoting effect on the upgrading of GVC(4) For manufacturing industries with different levels of technological development, the promotion effect of manufacturing servitization on high-tech industries is more obvious. This paper has two main implications: On one hand, the government should not only increase support for the service sectors, but also promote the innovative development of the service sectors. On the other hand, it is necessary to improve the level of opening up to the outside world, make full use of the positive “spillover effect” of high-quality service elements, and promote the integration of production-oriented services and manufacturing.

Learning from innovation award winners? Technology spillovers and firm innovation

Innovation is a vital output of knowledge resources, significantly enhancing firms' competitive advantages. Faced with outstandingly innovative competitors, firms may experience technology spillovers driven by the pressure of technological updating, thereby stimulating innovation. Based on data from Chinese listed firms from 2011 to 2019, we explore firms' reactions to innovation award winners within their product boundaries. The results indicate that firms encountering award-winning competitors experience heightened technology spillovers initiated by these outstanding peers. Unlike residual technology spillovers, award-driven technology spillovers actively promote firms' innovation activities and incentivize investment in knowledge resources. We further identify two primary channels of technology spillovers: competition and information. Under the competition channel, factors such as competitive pressure, market concentration, and market performance shape firms' responses to competitors' innovation awards. Regarding the information channel, the influence of competitors' technological advancements is more significant for firms with more politically connected competitors, non-stated-owned ownership, and those in a follower position. The findings underscore the critical role of innovation award winners in driving firm innovation.

Does digital technology innovation promote low-carbon development in agriculture?: A spatial econometric analysis based on 31 provinces in China.

China's traditional agriculture has grown quickly but at the cost of excessive pollution and energy consumption. Therefore, low-carbon development in agriculture is crucial to achieving "carbon neutrality" and "carbon peaking." With the development of China's digital economy and the construction of digital villages in recent years, digital technology innovation (DTI) is probably going to a significant role in lowering agricultural carbon emissions (ACEs). Based on Chinese provincial panel data from 2006 to 2021, we analyze the spatial and temporal evolution characteristics of DTI and ACE, explore the impact and the pathways of DTI on ACE using a spatial econometric model, and reveal this impact's heterogeneity and nonlinear character. The findings show that DTI and ACE increased significantly throughout all Chinese provinces. DTI agglomeration is becoming stronger, whereas ACE displays a tendency for discontinuous distribution. DTI is essential in promoting low-carbon development in agriculture, and there are significant spatial spillover effects due to technology spillovers. Heterogeneity analysis indicates that DTI has positive impacts on local agriculture in different regions. However, there is variation in the impact's degree. The mechanism test's findings show how DTI reduces ACE by improving technology and enhancing resource endowment. The relationship between DTI and ACE exhibits an inverted "U" curve, and the level of economic development is the threshold variable that constrains the relationship between the two variables. To achieve a regional balanced low-carbon development in agriculture through DTI, it is important to emphasize the impact of DTI on reducing carbon emissions and to encourage the transfer of mature technology from high-level regions to low-level regions.

Can the Digital Economy Promote the High-Quality Development of Communication Service Trade? —— A Study Based on the Perspective of Computers and Information Services

Digital economy has developed rapidly and been widely used. The trade in computer and information services has also shown new characteristics such as networking and digitalization. Digital economy is important to promote communication's development. The paper analyzes the impact of digital economy on China's computer and information service trade from the cost savings effect and technology spillover effect, and put forward some empirical suggestions.

The rebound effect of energy consumption and its determinants in China's agricultural production

With the facilitation of agricultural modernization, China's agricultural energy consumption continues to rise. This paper empirically tests the agricultural energy rebound effect and its influencing factors in China during 1999–2020. It is believed that the improvement of energy efficiency has not led to the expected energy-saving effect in agriculture due to the "Jevons paradox" of energy efficiency and energy consumption. The average energy efficiency of China's agricultural energy consumption was 0.446, and the average energy rebound effect was 68.9 %. The level of agricultural mechanization, the effective irrigated area of farmland and agricultural investment have a positive impact on the rebound effect of agricultural energy, and the direct effects are 0.062, 0.008 and 0.064, respectively, while agricultural labor force and energy price have a negative impact on the rebound effect of agricultural energy. In particular, technology spillover and scale spillover led by agricultural technology progress have strong negative space spillover effect. As it is argued, 1 % of agricultural technology progress can reduce 3.5 % of agricultural energy rebound effect in surrounding areas. In order to reduce the energy rebound effect, it is suggested to increase the subsidies to agricultural labors and rationally formulate regional differentiated energy regulation policies.

Foreign Direct Investment and Technology Spillovers: An Analysis of Indian Manufacturing

Using a rich firm-level panel dataset of Indian manufacturing over 2010–2018, this study aims to identify the spillover effects associated with foreign direct investment (FDI). To this end, we distinguish spillover effects into horizontal (Intra-industry linkage) and vertical (backward or downstream and forward or upstream Inter-industry linkages) FDI channels. We employ various semi-parametric methods to tackle the endogeneity issues in productivity estimation. We find that backward spillover from the downstream multinational enterprises is the only source of total factor productivity gains. However, the magnitude of negative forward–vertical linkage is larger than the positive backward–vertical effect. The analysis also broadly compares technology spillovers for domestic and all firms in the sector. Finally, we investigate productivity spillover across industries based on their technology intensity. Our findings suggest that industry heterogeneity is a key driver of FDI spillover. JEL Codes: F23, D24, O33, L1

Examining green productivity amidst climate change technological development and spillovers in the Nordic economies

The common ground of both critics and proponents of green productivity is arguably hinged on the main role of environmental technological advancement. Considering the drive for climate-neutral economy among the Nordic states, the current study examines the role of climate change technological development within the countries and technological spillovers across countries in the pursuit for green economy. By using a combination of pooled mean group approach of autoregressive distributed lag (for coefficient estimation) and the recently developed Granger non-causality approach by Juodis et al. (2021) for the panel dataset analysis over the period 1990–2018, the results reveal that both domestic technological development and spillovers from abroad promote long-run green productivity growth in the panel and country-specific estimations. In both estimations, the impact of international diffusion of climate change technologies on green productivity is found to be larger. Additionally, the influence of these two dynamics of climate change-related technologies on attaining greening economy is the most impactful in Sweden. In the remaining Nordic economies, climate change technology spillovers in Denmark are more impactful than in Finland and least in Norway, while climate change technological development in Norway drives green productivity more than in Finland and least in Denmark. As a robust insight, the Granger causality techniques revealed causality from climate change technologies within the countries, climate change technology spillovers, and population to green productivity. Consequently, public policies should promote green innovativeness and especially learning and knowledge transfer from other countries to achieve climate neutrality targets.