IDEAS home Printed from https://ideas.repec.org/a/eee/streco/v62y2022icp343-359.html
   My bibliography  Save this article

Social capital and regional innovation efficiency: The moderating effect of governance quality

Author

Listed:
  • Zhang, Liangliang
  • Huang, Shoujun

Abstract

Most studies demonstrate the determinants of institutional factors on regional innovation behavior in an isolated way, thus ignoring the interaction between different dimensions of institutions. This paper brings heterogeneous social capital and governance quality into the category of regional innovation efficiency. An empirical study based on China's provincial data showed that R&D resources and innovation capability combined in developed regions. Structural social capital led to a significant reduction in R&D input and output, which actually deviated from the original intention to improve the efficiency in regional innovation. Governance quality moderated structural social capital and regional innovation activities positively. The mechanism of cognitive social capital was similar with that of governance quality in enhancing regional innovation efficiency because innovation output greatly exceeded R&D investment. The negative moderating effect of governance quality revealed the substitution relationship between cognitive social capital and governance quality in the regional innovation system.

Suggested Citation

  • Zhang, Liangliang & Huang, Shoujun, 2022. "Social capital and regional innovation efficiency: The moderating effect of governance quality," Structural Change and Economic Dynamics, Elsevier, vol. 62(C), pages 343-359.
    • Handle: RePEc:eee:streco:v:62:y:2022:i:c:p:343-359
    DOI: 10.1016/j.strueco.2022.05.013
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S0954349X22000790
    Download Restriction: Full text for ScienceDirect subscribers only
    File URL: https://libkey.io/10.1016/j.strueco.2022.05.013?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Howells, Jeremy, 2005. "Innovation and regional economic development: A matter of perspective?," Research Policy, Elsevier, vol. 34(8), pages 1220-1234, October.
    2. Thompson, Maria, 2018. "Social capital, innovation and economic growth," Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics), Elsevier, vol. 73(C), pages 46-52.
    3. Acharya, Viral & Xu, Zhaoxia, 2017. "Financial dependence and innovation: The case of public versus private firms," Journal of Financial Economics, Elsevier, vol. 124(2), pages 223-243.
    4. Kafouros, Mario & Wang, Chengqi & Piperopoulos, Panagiotis & Zhang, Mingshen, 2015. "Academic collaborations and firm innovation performance in China: The role of region-specific institutions," Research Policy, Elsevier, vol. 44(3), pages 803-817.
    5. Robert E. Hall & Charles I. Jones, 1999. "Why do Some Countries Produce So Much More Output Per Worker than Others?," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 114(1), pages 83-116.
    6. Bekhet, Hussain Ali & Latif, Nurul Wahilah Abdul, 2018. "The impact of technological innovation and governance institution quality on Malaysia's sustainable growth: Evidence from a dynamic relationship," Technology in Society, Elsevier, vol. 54(C), pages 27-40.
    7. Audretsch, David B & Feldman, Maryann P, 1996. "R&D Spillovers and the Geography of Innovation and Production," American Economic Review, American Economic Association, vol. 86(3), pages 630-640, June.
    8. Mo, Changwei & He, Chaohua & Yang, Lingna, 2020. "Structural characteristics of industrial clusters and regional innovation," Economics Letters, Elsevier, vol. 188(C).
    9. Weng Chang Lee & Siong Hook Law, 2017. "Roles of Formal Institutions and Social Capital in Innovation Activities: A Cross-Country Analysis," Global Economic Review, Taylor & Francis Journals, vol. 46(3), pages 203-231, July.
    10. Harper, David A., 2018. "Innovation and institutions from the bottom up: an introduction," Journal of Institutional Economics, Cambridge University Press, vol. 14(6), pages 975-1001, December.
    11. Lynn, Leonard H. & Mohan Reddy, N. & Aram, John D., 1996. "Linking technology and institutions: the innovation community framework," Research Policy, Elsevier, vol. 25(1), pages 91-106, January.
    12. Tiago Neves Sequeira & Alexandra Ferreira-Lopes, 2013. "Social capital and investment in R&D: new externalities," Journal of Business Economics and Management, Taylor & Francis Journals, vol. 14(1), pages 77-97, February.
    13. Daron Acemoglu & Simon Johnson & James A. Robinson, 2001. "The Colonial Origins of Comparative Development: An Empirical Investigation," American Economic Review, American Economic Association, vol. 91(5), pages 1369-1401, December.
    14. Tom Broekel, 2015. "Do Cooperative Research and Development (R&D) Subsidies Stimulate Regional Innovation Efficiency? Evidence from Germany," Regional Studies, Taylor & Francis Journals, vol. 49(7), pages 1087-1110, July.
    15. Alberto Batinti & Andrea Filippetti & Luca Andriani, 2017. "Why Does Social Capital Increase Government Performance? The Role of Local Elections across Italian Municipalities," Management Working Papers 13, Birkbeck Department of Management, revised Apr 2017.
    16. Rune Njøs & Stig-Erik Jakobsen, 2018. "Policy for Evolution of Regional Innovation Systems: The Role of Social Capital and Regional Particularities," Science and Public Policy, Oxford University Press, vol. 45(2), pages 257-268.
    17. Ho, Chun-Yu & Huang, Shaoqing & Shi, Hao & Wu, Jun, 2018. "Financial deepening and innovation: The role of political institutions," World Development, Elsevier, vol. 109(C), pages 1-13.
    18. Junhong Bai, 2013. "On Regional Innovation Efficiency: Evidence from Panel Data of China's Different Provinces," Regional Studies, Taylor & Francis Journals, vol. 47(5), pages 773-788, May.
    19. Nathan Nunn & Nancy Qian, 2014. "US Food Aid and Civil Conflict," American Economic Review, American Economic Association, vol. 104(6), pages 1630-1666, June.
    20. Blind, Knut & Petersen, Sören S. & Riillo, Cesare A.F., 2017. "The impact of standards and regulation on innovation in uncertain markets," Research Policy, Elsevier, vol. 46(1), pages 249-264.
    21. Karl V. Lins & Henri Servaes & Ane Tamayo, 2017. "Social Capital, Trust, and Firm Performance: The Value of Corporate Social Responsibility during the Financial Crisis," Journal of Finance, American Finance Association, vol. 72(4), pages 1785-1824, August.
    22. Inbar Weiss & Pamela Paxton & Kristopher Velasco & Robert W. Ressler, 2019. "Revisiting Declines in Social Capital: Evidence from a New Measure," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 142(3), pages 1015-1029, April.
    23. Mourad Dakhli & Dirk De Clercq, 2004. "Human capital, social capital, and innovation: a multi-country study," Entrepreneurship & Regional Development, Taylor & Francis Journals, vol. 16(2), pages 107-128, March.
    24. Wenting Chen & Chunjia Han & Lei Wang & Petros Ieromonachou & Xiaochen Lu, 2021. "Recognition of entrepreneur’s social ties and firm innovation in emerging markets: explanation from the industrial institutional environment and survival pressure," Asia Pacific Journal of Management, Springer, vol. 38(2), pages 491-518, June.
    25. Trinugroho, Irwan & Law, Siong Hook & Lee, Weng Chang & Wiwoho, Jamal & Sergi, Bruno S., 2021. "Effect of financial development on innovation: Roles of market institutions," Economic Modelling, Elsevier, vol. 103(C).
    26. Izzet Sidki Darendeli & T L Hill, 2016. "Uncovering the complex relationships between political risk and MNE firm legitimacy: Insights from Libya," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 47(1), pages 68-92, January.
    27. Jie (Jack) He & Xuan Tian, 2020. "Institutions and Innovation," Annual Review of Financial Economics, Annual Reviews, vol. 12(1), pages 377-398, December.
    28. Yu, Sui-Hua, 2013. "Social capital, absorptive capability, and firm innovation," Technological Forecasting and Social Change, Elsevier, vol. 80(7), pages 1261-1270.
    29. Marshall, Guillermo & Parra, Álvaro, 2019. "Innovation and competition: The role of the product market," International Journal of Industrial Organization, Elsevier, vol. 65(C), pages 221-247.
    30. Nicholas Charron & Lewis Dijkstra & Victor Lapuente, 2014. "Regional Governance Matters: Quality of Government within European Union Member States," Regional Studies, Taylor & Francis Journals, vol. 48(1), pages 68-90, January.
    31. Rodríguez-Pose, Andrés & Zhang, Min, 2020. "The cost of weak institutions for innovation in China," Technological Forecasting and Social Change, Elsevier, vol. 153(C).
    32. Elizabeth A. Alexander, 2012. "The Effects of Legal, Normative, and Cultural-Cognitive Institutions on Innovation in Technology Alliances," Management International Review, Springer, vol. 52(6), pages 791-815, December.
    33. Robert Huggins & Piers Thompson, 2019. "The behavioural foundations of urban and regional development: culture, psychology and agency," Journal of Economic Geography, Oxford University Press, vol. 19(1), pages 121-146.
    34. Yano, Go & Shiraishi, Maho, 2020. "Finance, institutions, and innovation activities in China," Economic Systems, Elsevier, vol. 44(4).
    35. Cruz-Cázares, Claudio & Bayona-Sáez, Cristina & García-Marco, Teresa, 2013. "You can’t manage right what you can’t measure well: Technological innovation efficiency," Research Policy, Elsevier, vol. 42(6), pages 1239-1250.
    36. Mukherjee, Abhiroop & Singh, Manpreet & Žaldokas, Alminas, 2017. "Do corporate taxes hinder innovation?," Journal of Financial Economics, Elsevier, vol. 124(1), pages 195-221.
    37. ZHANG, Hongyong, 2015. "How does agglomeration promote the product innovation of Chinese firms?," China Economic Review, Elsevier, vol. 35(C), pages 105-120.
    38. Carpiano, Richard M. & Fitterer, Lisa M., 2014. "Questions of trust in health research on social capital: What aspects of personal network social capital do they measure?," Social Science & Medicine, Elsevier, vol. 116(C), pages 225-234.
    39. O'Brien, Megan S. & Burdsal, Charles A. & Molgaard, Craig A., 2004. "Further development of an Australian-based measure of social capital in a US sample," Social Science & Medicine, Elsevier, vol. 59(6), pages 1207-1217, September.
    40. Guan, Jiancheng & Chen, Kaihua, 2012. "Modeling the relative efficiency of national innovation systems," Research Policy, Elsevier, vol. 41(1), pages 102-115.
    41. Paolo Mauro, 1995. "Corruption and Growth," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 110(3), pages 681-712.
    42. Hirshleifer, David & Hsu, Po-Hsuan & Li, Dongmei, 2013. "Innovative efficiency and stock returns," Journal of Financial Economics, Elsevier, vol. 107(3), pages 632-654.
    43. Joonmo Son, 2016. "Institutional Affiliation as a Measure of Organizational Social Capital: A Case Study of Korea," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 129(2), pages 699-716, November.
    44. Dobson, Wendy & Safarian, A.E., 2008. "The transition from imitation to innovation: An enquiry into China's evolving institutions and firm capabilities," Journal of Asian Economics, Elsevier, vol. 19(4), pages 301-311, August.
    45. Min, Sujin & Kim, Juseong & Sawng, Yeong-Wha, 2020. "The effect of innovation network size and public R&D investment on regional innovation efficiency," Technological Forecasting and Social Change, Elsevier, vol. 155(C).
    46. Chen, Jian & Wang, Lingjun & Li, Yuanyuan, 2020. "Natural resources, urbanization and regional innovation capabilities," Resources Policy, Elsevier, vol. 66(C).
    47. Guan, JianCheng & Yam, Richard C.M., 2015. "Effects of government financial incentives on firms’ innovation performance in China: Evidences from Beijing in the 1990s," Research Policy, Elsevier, vol. 44(1), pages 273-282.
    48. Yi Qu & Yingqi Wei, 2017. "The Role of Domestic Institutions and FDI on Innovation—Evidence from Chinese Firms," Asian Economic Papers, MIT Press, vol. 16(2), pages 55-76, Summer.
    49. Seongsoo Jang & Jinwon Kim & Max von Zedtwitz, 2017. "The importance of spatial agglomeration in product innovation: A microgeography perspective," Post-Print hal-02004347, HAL.
    50. Yanmei Zhu & Xinhua Wittmann & Mike Peng, 2012. "Institution-based barriers to innovation in SMEs in China," Asia Pacific Journal of Management, Springer, vol. 29(4), pages 1131-1142, December.
    51. Yang, Chih-Hai & Lin, Hui-Lin & Li, Hsiao-Yun, 2013. "Influences of production and R&D agglomeration on productivity: Evidence from Chinese electronics firms," China Economic Review, Elsevier, vol. 27(C), pages 162-178.
    52. Xiafei Chen & Zhiying Liu & Chaoliang Ma, 2017. "Chinese innovation-driving factors: regional structure, innovation effect, and economic development—empirical research based on panel data," The Annals of Regional Science, Springer;Western Regional Science Association, vol. 59(1), pages 43-68, July.
    53. Pérez-Luño, Ana & Cabello Medina, Carmen & Carmona Lavado, Antonio & Cuevas Rodríguez, Gloria, 2011. "How social capital and knowledge affect innovation," Journal of Business Research, Elsevier, vol. 64(12), pages 1369-1376.
    54. van Rijn, Fédes & Bulte, Erwin & Adekunle, Adewale, 2012. "Social capital and agricultural innovation in Sub-Saharan Africa," Agricultural Systems, Elsevier, vol. 108(C), pages 112-122.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Yonghui Cheng & Qi Kang & Kewei Liu & Peng Cui & Kaixu Zhao & Jianwei Li & Xue Ma & Qingsong Ni, 2023. "Impact of Urbanization on Ecosystem Service Value from the Perspective of Spatio-Temporal Heterogeneity: A Case Study from the Yellow River Basin," Land, MDPI, vol. 12(7), pages 1-27, June.
    2. Xiaoqing Ai & Hongda Zhang & Keyu Guo & Fubin Shi, 2022. "Does Regional Innovation Environment Have an Impact on the Gathering of Technological Talent? An Empirical Study Based on 31 Provinces in China," Sustainability, MDPI, vol. 14(23), pages 1-17, November.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Hameeda A. AlMalki & Christopher M. Durugbo, 2023. "Systematic review of institutional innovation literature: towards a multi-level management model," Management Review Quarterly, Springer, vol. 73(2), pages 731-785, June.
    2. Qian Lu & Chao Hua & Jianjun Miao, 2022. "The Impact of Factor Market Distortion on the Efficiency of Technological Innovation: A Spatial Analysis," Sustainability, MDPI, vol. 14(19), pages 1-15, September.
    3. Hasan, Iftekhar & (Stan) Hoi, Chun-Keung & Wu, Qiang & Zhang, Hao, 2020. "Is social capital associated with corporate innovation? Evidence from publicly listed firms in the U.S," Journal of Corporate Finance, Elsevier, vol. 62(C).
    4. Wan, Qunchao & Chen, Jin & Yao, Zhu & Yuan, Ling, 2022. "Preferential tax policy and R&D personnel flow for technological innovation efficiency of China's high-tech industry in an emerging economy," Technological Forecasting and Social Change, Elsevier, vol. 174(C).
    5. Sara Amoroso & Benedikt Herrmann & Alexander S. Kritikos, 2023. "The Role of Regulation and Regional Government Quality for High Growth Firms: The Good, the Bad, and the Ugly," Discussion Papers of DIW Berlin 2053, DIW Berlin, German Institute for Economic Research.
    6. Zhang, Min & Rodríguez-Pose, Andrés, 2024. "Government reform and innovation performance in China," LSE Research Online Documents on Economics 122728, London School of Economics and Political Science, LSE Library.
    7. Sharma, Abhijit & Sousa, Cristina & Woodward, Richard, 2022. "Determinants of innovation outcomes: The role of institutional quality," Technovation, Elsevier, vol. 118(C).
    8. Francesco Pasimeni & Paolo Pasimeni, 2016. "An Institutional Analysis of the Europe 2020 Strategy," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 127(3), pages 1021-1038, July.
    9. Askarov, Zohid & Doucouliagos, Hristos, 2015. "Aid and institutions in transition economies," European Journal of Political Economy, Elsevier, vol. 38(C), pages 55-70.
    10. Sun, Helin & Cappa, Francesco & Zhu, Jia & Peruffo, Enzo, 2023. "The effect of CEO social capital, CEO duality and state-ownership on corporate innovation," International Review of Financial Analysis, Elsevier, vol. 87(C).
    11. Antonella Rita Ferrara & Rosanna Nisticò, 2019. "Does Institutional Quality Matter for Multidimensional Well-Being Inequalities? Insights from Italy," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 145(3), pages 1063-1105, October.
    12. Amoroso, Sara & Herrmann, Benedikt & Kritikos, Alexander S., 2023. "The Role of Regulation and Regional Government Quality for High Growth Firms: The Good, the Bad, and the Ugly," IZA Discussion Papers 16563, Institute of Labor Economics (IZA).
    13. Sara Amoroso & Benedikt Herrmann & Alexander S. Kritikos, 2023. "The Role of Regulation and Regional Government Quality for High Growth Firms: The Good, the Bad, and the Ugly," CEPA Discussion Papers 71, Center for Economic Policy Analysis.
    14. Hu, Xiaotian & Yin, Xiaopeng, 2022. "Do stronger intellectual property rights protections raise productivity within the context of trade liberalization? Evidence from China," Economic Modelling, Elsevier, vol. 110(C).
    15. Chowdhury, Shyamal K., 2004. "The effect of democracy and press freedom on corruption: an empirical test," Economics Letters, Elsevier, vol. 85(1), pages 93-101, October.
    16. Ahmet Faruk Aysan & …mer Faruk Baykal & Marie-Ange Véganzonès–Varoudakis, 2011. "The Effects of Convergence in Governance on Capital Accumulation in the Black Sea Economic Cooperation Countries," Chapters, in: Mehmet Ugur & David Sunderland (ed.), Does Economic Governance Matter?, chapter 6, Edward Elgar Publishing.
    17. Fetzer, James J. & Rivera, Sandra A., 2005. "Modeling Modifications in Rules of Origin: A Partial Equilibrium Approach," Conference papers 331372, Purdue University, Center for Global Trade Analysis, Global Trade Analysis Project.
    18. Ahmet Faruk AYSAN & Mustapha Kamel NABLI & Marie‐Ange VÉGANZONÈS‐VAROUDAKIS, 2007. "Governance Institutions And Private Investment: An Application To The Middle East And North Africa," The Developing Economies, Institute of Developing Economies, vol. 45(3), pages 339-377, September.
    19. Delgado, Michael S. & McCloud, Nadine & Kumbhakar, Subal C., 2014. "A generalized empirical model of corruption, foreign direct investment, and growth," Journal of Macroeconomics, Elsevier, vol. 42(C), pages 298-316.
    20. Abdih, Yasser & Chami, Ralph & Dagher, Jihad & Montiel, Peter, 2012. "Remittances and Institutions: Are Remittances a Curse?," World Development, Elsevier, vol. 40(4), pages 657-666.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:streco:v:62:y:2022:i:c:p:343-359. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Catherine Liu (email available below). General contact details of provider: http://www.elsevier.com/locate/inca/525148 .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.