The Path Innovation of Regional Economic Growth: Data Analysis Based on China

Abstract

AbstractInnovative development to some extent overcomes the path-dependent characteristics of knowledge proximity, and the diversity and complexity of regional knowledge and technology foster regional economic growth. This study constructs a dynamic mechanism for maximizing the enterprise profit to explore the conditions enabling regions that can achieve knowledge accumulation and technological leapfrogging. Utilizing the fitness landscape methodology based on customs data from 30 provinces in China and employing genetic algorithms, we analyze two modes of enterprises with similar and different initial conditions under varying leapfrogging scenarios. By applying profit maximization rules within the fitness landscape of the product space, we examine how to promote regional industrial transformation and upgrade. The results indicate that a larger leap range in the production of products by enterprises, reflecting stronger innovative capabilities, significantly enhances the region’s ability for industrial transformation and upgrade. There is a strong positive relationship between the initial industrial foundation and regional economic development. When regions share a similar industrial base, the complexity of regional knowledge becomes more critical. Therefore, an increase in the foundational development of industries and technology-intensive products can enhance the potential for regional path innovation. Past research has primarily been based on the path dependence theory, emphasizing that the most crucial aspect for underdeveloped economies is the accumulation and development of foundational capabilities. However, our study contends that, for emerging economies, it is crucial to enhance the diversity and complexity of knowledge and technology. Particularly, it is essential to, based on a comprehensive understanding of their own strengths, open up new areas and new arenas in development, continually shaping new growth drivers and new strengths. This emerges as a significant factor in regional growth and leapfrog development.