Product Innovational Strategy and Cooperation in China

The paper presents the results of an empirical study that aims to investigate the impact of inter-firm cooperation over innovation on product innovation in China. Drawing on the innovative milieu literature, the impact on the product innovation was tested in three different ownership structures: state-owned concentration, non-state-owned concentration, and non-state-owned decentralization. Three models were run by using a unique data come from Chinese listed corporations in five hi-innovation industries. The main findings of the paper seem to provide substantial evidence that state-owned firms' capacity to product innovation could greatly improve if they cooperated with other firms. However, for non-state-owned decentralization corporations, cooperation is not a good way to product innovation. Therefore, innovation policy should not overlook the ownership component of innovation corporations and ought to initiate and support inter-firm cooperation selectively.