Comparative Research On The Scientific & Technological Innovation Capability And Efficiency As Between Western And Eastern China

Historically, economic growth was highly correlated to technological progress, and technological progress was full of innovation. The effect of any innovation on society and economy is almost immeasurable. Annual Report on Overall Competitiveness of China's Provincial Economy(2008-2009) shows that Western provinces has made progress in competitiveness through 2008, but big gap between the Western and Eastern provinces remains. The purpose of this thesis is to provide suggestions on improving the innovation capability and efficiency of the Western and Eastern provinces.The thesis consists of seven sections. Section one is the overview of research in the field of innovation. In section two, the theory of economic growth and organization theory and their respective definition of innovation is elaborated. Section three is about the comparative appraisal of the innovation capability as between the West and the East using scientific measurement approach. The results show that the capability of input and output in the East is greater than that in the West. In section four, the technical efficiency and Malmquist index for the two regions is computed. Results show that in the knowledge creation the technical efficiency and the contribution of innovation to the growth of knowledge output is higher in the West, while in the East, the technical efficiency and Malmquist index is higher in terms of commercial success of innovation. Section five is about the correlation analysis of innovation capability with factors. Analyses show economic development, number of people engaging in scientific & technological research and path dependence better explain the variance in innovation capability between the two regions. DEA cost analysis shows the allocative efficiency of the West is higher in knowledge creation, while it is higher in terms of commercial success in the East. In section six, the problems in the S&T innovation are identified, and suggestions on improving technological innovation capability and efficiency are proposed. In section seven, the conclusions drawn is that the West should optimize investment mechanism to improve innovation capability; the interaction in S&T innovation between the West and East may help improve allocative efficiency.