Dynamics of innovation in a globalizing china: regional environment, inter-firm relations and firm attributes

Existing theoretical attempts to understand the dynamics of technological innovation have focused on the influence of regional environment and inter-firm relations. More recently, however, a number of studies have suggested that firm-specific attributes be taken as the key to innovation. This study examines the determinants of technological innovation in China’s ICT firms based on a large-scale questionnaire survey. We reveal that firm-level attributes are of great importance to innovation whereas the influences of region/relation-specific factors are modified by the types of innovation and by firms’ strategies and motivations. The role of regional and relational assets should not be over-emphasized at the expense of firm-level attributes. Research emphasis should be placed on the process of how firm attributes interacted with regional environment and inter-firm relations to shape innovation. The article concludes with a plea to bring ‘the firm’ back to the centre and adopt an interactionist approach to understanding technological innovation.