The technological innovation performance of Chinese firms: the role of industrial and academic R&D, FDI and the markets in firm patenting

This paper examines the recent development of industrial technology in China using a rich and novel Chinese patent dataset, which allows us to get a comprehensive view of the invention activities in China. Combing patent statistics with R&D and Foreign Direct Investment (FDI) indicators, we found that the R&D activities at local universities and research institutes were the most important external factors behind the increase in domestic firms' patenting activities. FDI, on the other hand, appeared to have a negative effect on domestic firm patenting, at least until foreign market demand for domestic production is established.

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