Academic collaborations and firm innovation performance in China: The role of region-specific institutions

Abstract

Although prior research has highlighted the importance of academic collaborations in enhancing firms’ innovation performance, it has largely focused on developed countries. As a result, how academic collaborations influence innovation in emerging countries, which differ fundamentally from developed countries in their institutional environment, remains unclear. We contribute to this literature by examining how collaborations with universities and research institutes influence the ability of Chinese emerging market enterprises (EMEs) to develop innovations. Our analysis challenges the assumption of institutional homogeneity within a given country, showing that institutions evolve in different ways across sub-national Chinese regions. This uneven institutional evolution affects the enforcement of intellectual property rights (IPRs), the level of international openness, the quality of universities and research institutes across regions and thus the degree to which Chinese EMEs benefit from academic collaborations. Our findings reveal that sub-national institutional variations have a profound impact on the relationship between academic collaborations and firms’ innovation performance, illustrate that some established assumptions are not valid in emerging countries, such as China, and offer insights into how EMEs can enhance their innovation performance.