R&D, Technology Transfer and Productivity Growth: Evidence from Chinese Manufacturing Industries

Based on an industry-level data set for Chinese largeand medium-size manufacturing enterprises over the period of 1996–2006, the paper investigates the impacts of three technology acquisition channels, i.e. in-house R&D, foreign technology transfer and domestic technology transfer, on the productivity growth by using both the output elasticity and the rate of return methods. We find that in-house R&D makes substantial and significant contributions to productivity growth in Chinese manufacturing industries, and that technology transfers, whether foreign or domestic, have no significantly positive effects on productivity growth. When the productivity growth is decomposed into technical efficiency change and technological progress by using Data Envelopment Analysis, we also find that the important role of R&D in improving industry performance is mainly attributable to the contributions of R&D to technical efficiency change.