Are Innovation Output and Economic Output Strongly Related in Emerging Industrial Clusters? Evidence from China

Abstract

For many countries, innovation-driven development has become a prevalent consensus because innovation can effectively stimulate economic growth. Emerging industries are innovation-intensive with high potential economic benefit. However, is it assured that high innovation output means high economic benefit? In October of 2010, China State Council initiated the Decision of Speeding up Cultivation and Development of Strategic Emerging Industries, signifying top-down policy mobilization to advance emerging industries. According to seven types of emerging industries defined in the Decision, we collected data from official industrial databases to figure out spatial divergence of emerging industries in terms of innovation output and economic benefit over the years from 2000 to 2011. We construct twodimension scatter diagrams based on number of granted patents as the indicator of innovation output and industrial locational quotient as the indicator of industrial economic benefit. The result shows that China has seen preliminary spatial clustering of key emerging industries across regions and industries in the light of innovation output and economic benefit. However, not all regions with high innovation output have high economic benefit. The spatial divergence is closely related to region-specific and industry-specific characteristics. We offer policy implications to facilitate targeted emerging industries with more detailed policy and regional endowment.