IDEAS home Printed from https://ideas.repec.org/a/gam/jsusta/v12y2020i22p9537-d445929.html
   My bibliography  Save this article

The Influence of Quality and Variety of New Imports on Enterprise Innovation: Evidence from China

Author

Listed:
  • Guifu Chen

    (Center for Macroeconomic Research, The School of Economics, Xiamen University, Xiamen 361005, China)

  • Shan Zhan

    (Center for Macroeconomic Research, The School of Economics, Xiamen University, Xiamen 361005, China)

  • Shigeyuki Hamori

    (Faculty of Economics, Kobe University, Kobe 657-8501, Japan)

Abstract

In this study, we introduce the concept of differentiated quality inputs with knowledge-driven specifications for research and development (R&D) under an open economy to the endogenous growth model of knowledge spillover. Using matching industry enterprise and customs data from 2001 to 2007, which is representative of micro data at the Chinese industry level, we theoretically analyze the influence of the quality and variety of imported products on Chinese enterprises’ innovation and economic growth. We find that, first, the improvement of the quality and variety of new imported products can promote enterprise innovation. Second, new imported intermediate inputs and capital goods, new imported high-technology products, and products imported from Organization for Economic Co-operation and Development (OECD) countries have stronger promoting effects on enterprise innovation. We conclude that imported products stimulate the growth of the economy through two channels: expanding the variety and increasing the quality of inputs. To verify the stability of our model, we conducted robustness tests by defining new imported products based on a base year, measuring enterprise innovation by the number of patent applications, and measuring the quality of new imported products in a new way.

Suggested Citation

  • Guifu Chen & Shan Zhan & Shigeyuki Hamori, 2020. "The Influence of Quality and Variety of New Imports on Enterprise Innovation: Evidence from China," Sustainability, MDPI, vol. 12(22), pages 1-20, November.
    • Handle: RePEc:gam:jsusta:v:12:y:2020:i:22:p:9537-:d:445929
    as

    Download full text from publisher

    File URL: https://www.mdpi.com/2071-1050/12/22/9537/pdf
    Download Restriction: no
    File URL: https://www.mdpi.com/2071-1050/12/22/9537/
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Maria Bas & Vanessa Strauss-Kahn, 2014. "Does importing more inputs raise exports? Firm-level evidence from France," Review of World Economics (Weltwirtschaftliches Archiv), Springer;Institut für Weltwirtschaft (Kiel Institute for the World Economy), vol. 150(2), pages 241-275, May.
    2. Francisco L. Rivera-Batiz & Luis A. Rivera-Batiz, 2018. "Economic Integration and Endogenous Growth," World Scientific Book Chapters, in: Francisco L Rivera-Batiz & Luis A Rivera-Batiz (ed.), International Trade, Capital Flows and Economic Development, chapter 1, pages 3-32, World Scientific Publishing Co. Pte. Ltd..
    3. Amit Khandelwal, 2010. "The Long and Short (of) Quality Ladders," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 77(4), pages 1450-1476.
    4. Christian Broda & David E. Weinstein, 2006. "Globalization and the Gains From Variety," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 121(2), pages 541-585.
    5. Coe, David T. & Helpman, Elhanan, 1995. "International R&D spillovers," European Economic Review, Elsevier, vol. 39(5), pages 859-887, May.
    6. Pinelopi Goldberg & Amit Khandelwal & Nina Pavcnik & Petia Topalova, 2009. "Trade Liberalization and New Imported Inputs," American Economic Review, American Economic Association, vol. 99(2), pages 494-500, May.
    7. Sanjaya Lall, 2000. "The Technological Structure and Performance of Developing Country Manufactured Exports, 1985-98," Oxford Development Studies, Taylor & Francis Journals, vol. 28(3), pages 337-369.
    8. Amit K. Khandelwal & Peter K. Schott & Shang-Jin Wei, 2013. "Trade Liberalization and Embedded Institutional Reform: Evidence from Chinese Exporters," American Economic Review, American Economic Association, vol. 103(6), pages 2169-2195, October.
    9. Colantone, Italo & Crinò, Rosario, 2014. "New imported inputs, new domestic products," Journal of International Economics, Elsevier, vol. 92(1), pages 147-165.
    10. David Hummels & Peter J. Klenow, 2005. "The Variety and Quality of a Nation's Exports," American Economic Review, American Economic Association, vol. 95(3), pages 704-723, June.
    11. Peter K. Schott, 2004. "Across-Product Versus Within-Product Specialization in International Trade," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 119(2), pages 647-678.
    12. Mary Amiti & Jozef Konings, 2007. "Trade Liberalization, Intermediate Inputs, and Productivity: Evidence from Indonesia," American Economic Review, American Economic Association, vol. 97(5), pages 1611-1638, December.
    13. Wolfgang Keller, 2004. "International Technology Diffusion," Journal of Economic Literature, American Economic Association, vol. 42(3), pages 752-782, September.
    14. Robert J. R. Elliott & Liza Jabbour & Liyun Zhang, 2016. "Firm productivity and importing: Evidence from Chinese manufacturing firms," Canadian Journal of Economics/Revue canadienne d'économique, John Wiley & Sons, vol. 49(3), pages 1086-1124, August.
    15. Chen, Zhiyuan & Zhang, Jie & Zheng, Wenping, 2017. "Import and innovation: Evidence from Chinese firms," European Economic Review, Elsevier, vol. 94(C), pages 205-220.
    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. Kexuan Zhou & Sanjay Kumar & Futao Lu & Qiaoyun Fang & Linhui Yu, 2022. "Has the Belt and Road Initiative Improved the Quality of Food Imported by Chinese Enterprises?," China & World Economy, Institute of World Economics and Politics, Chinese Academy of Social Sciences, vol. 30(2), pages 60-83, March.

    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. Colantone, Italo & Crinò, Rosario, 2014. "New imported inputs, new domestic products," Journal of International Economics, Elsevier, vol. 92(1), pages 147-165.
    2. Gnangnon, Sèna Kimm, 2020. "Aid for Trade, Export Product Diversification and Import Product Diversification," EconStor Preprints 223021, ZBW - Leibniz Information Centre for Economics.
    3. Olivier Cadot & Céline Carrère & Vanessa Strauss-Kahn, 2014. "OECD imports: diversification of suppliers and quality search," Review of World Economics (Weltwirtschaftliches Archiv), Springer;Institut für Weltwirtschaft (Kiel Institute for the World Economy), vol. 150(1), pages 1-24, February.
    4. Ricardo Arguello, 2017. "Trade diversification in Colombia, 1991-2011," Revista Cuadernos de Economia, Universidad Nacional de Colombia, FCE, CID, vol. 36(71), pages 345-378, July.
    5. Italo Colantone & Alessia Matano & Paolo Naticchioni, 2020. "New imported inputs, wages and worker mobility," Industrial and Corporate Change, Oxford University Press and the Associazione ICC, vol. 29(2), pages 423-457.
    6. Bas, Maria & Strauss-Kahn, Vanessa, 2015. "Input-trade liberalization, export prices and quality upgrading," Journal of International Economics, Elsevier, vol. 95(2), pages 250-262.
    7. Meng, Ning & Milner, Chris & Song, Huasheng, 2020. "Antidumping and heterogeneous quality adjustment of multi-product firms: Evidence from Chinese exporters," Economic Modelling, Elsevier, vol. 92(C), pages 147-161.
    8. Curzi, Daniele & Pacca, Lucia, 2015. "Price, quality and trade costs in the food sector," Food Policy, Elsevier, vol. 55(C), pages 147-158.
    9. Alessandra Bonfiglioli & Rosario Crinò & Gino Gancia, 2018. "Firms and Economic Performance: A view from Trade," Working Papers 1034, Barcelona School of Economics.
    10. Gideon Ndubuisi & Solomon Owusu, 2021. "How important is GVC participation to export upgrading?," The World Economy, Wiley Blackwell, vol. 44(10), pages 2887-2908, October.
    11. Curzi, Daniele & Raimondi, Valentina & Olper, Alessandro, 2013. "Quality Upgrading, Competition and Trade Policy: Evidence from the Agri-Food Sector," 2013: Productivity and Its Impacts on Global Trade, June 2-4, 2013. Seville, Spain 152386, International Agricultural Trade Research Consortium.
    12. Maria Bas & Vanessa Strauss-Kahn, 2014. "Does importing more inputs raise exports? Firm-level evidence from France," Review of World Economics (Weltwirtschaftliches Archiv), Springer;Institut für Weltwirtschaft (Kiel Institute for the World Economy), vol. 150(2), pages 241-275, May.
    13. C Sharma, 2016. "Does importing more inputs raise productivity and exports? Some evidence from Indian manufacturing," Economic Issues Journal Articles, Economic Issues, vol. 21(1), pages 1-23, March.
    14. Andrew B. Bernard & J. Bradford Jensen & Stephen J. Redding & Peter K. Schott, 2012. "The Empirics of Firm Heterogeneity and International Trade," Annual Review of Economics, Annual Reviews, vol. 4(1), pages 283-313, July.
    15. Andrea Ciani & Michele Imbruno, 2017. "Microeconomic mechanisms behind export spillovers from FDI: evidence from Bulgaria," Review of World Economics (Weltwirtschaftliches Archiv), Springer;Institut für Weltwirtschaft (Kiel Institute for the World Economy), vol. 153(4), pages 703-734, November.
    16. Robert J. R. Elliott & Liza Jabbour & Liyun Zhang, 2016. "Firm productivity and importing: Evidence from Chinese manufacturing firms," Canadian Journal of Economics/Revue canadienne d'économique, John Wiley & Sons, vol. 49(3), pages 1086-1124, August.
    17. Campbell, Jason, 2024. "The link between import sources and export success: Evidence from China," International Economics, Elsevier, vol. 178(C).
    18. Mary Amiti & Mi Dai & Robert C. Feenstra & John Romalis, 2017. "How did China’s WTO entry benefit U.S. prices?," Staff Reports 817, Federal Reserve Bank of New York.
    19. Lawrence Edwards & Marco Sanfilippo & Asha Sundaram, 2016. "Importing and firm performance: New evidence from South Africa," WIDER Working Paper Series 039, World Institute for Development Economic Research (UNU-WIDER).
    20. Dinopoulos, Elias & Unel, Bulent, 2011. "Quality heterogeneity and global economic growth," European Economic Review, Elsevier, vol. 55(5), pages 595-612, June.

    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:gam:jsusta:v:12:y:2020:i:22:p:9537-:d:445929. 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: MDPI Indexing Manager (email available below). General contact details of provider: https://www.mdpi.com .

    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.