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| Can the National Manufacturing Innovation Center Boost Advanced Manufacturing：A Quasi-natural Experiment in Hubei Province |
| Feng Luanye1,Cui Chunying2,Zhou Yucen1, Xu Xiaolin3 |
| (1. School of Public Administration, Huazhong University of Science and Technology, Wuhan 430074,China;2.Department of Economics & Management, Wenhua College, Wuhan 430074,China;3. Collage of Public Administration and Law, Hunan Agricultural University, Changsha 410128,China) |
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Abstract It has long been observed that many manufacturingeconomies run national superiority innovation organizations as a new type of industrial cooperation mode in the world high-end technology competition. In the face of such technological competition in manufacturing, China must also establish its own new vehicles for innovation and participate in the transformation and upgrading of global manufacturing. The Chinese local governments are encouraged to explore the operational experience of these manufacturing innovation centers. As a result, the policy has entered an implementation phase that goes beyond the study of the literature. Although, previous studies have explained similar impacts of innovation policies in a broader context, such as high-tech industries, they have not provided convincing evidence to show this trend. Therefore, this paper aims to address this gap by providing empirical evidence from Hubei province.#br#In the effort to meet domestic innovation needs and the global innovation challenges of a new wave of technological advances in manufacturing, the National Innovation Center of Manufacturing Industry (NICMI) was established with the support of Chinese policymakers. It is an attempt to create a new vehicle for innovation in the manufacturing sector. To address the transformation of the manufacturing sector, the Ministry of Industry and Information Technology has established 14 NICMIs across the mainland of China. To determine the facilitation role of NICMIs, this paper takes Hubei as a sample of treatment effects.#br#To estimate the causal inference of the impact of NICMIs initiation in Hubei, the implementation of NICMIs in 2017 is considered as a quasi-natural experiment. Quarterly inter-provincial panel data from 2016 to 2019 are employed to construct a difference-in-difference (DID) model to identify the promotion effect of NICMIs in the corresponding advanced manufacturing sector. This study takes Hubei province as the treatment group and other provinces without NIMICs as the control group. There are actually two different NIMICs established in Hubei province: the National Innovation Center for Information Optoelectronics and the National Innovation Center for Digital Design and Manufacturing. They cover three manufacturing industries in the advanced manufacturing category as defined by the NIMICs. The specific industries are metal cutting/melting equipment, semiconductor integrated circuits, and communication equipment manufacturing in Hubei. By observing the specific output indicators of the advanced manufacturing industries corresponding to the two NIMICs in Hubei Province and comparing the gap between Hubei Province and the control provinces during the policy window, this paperconcludes an effective average treatment effect (ATE) identification of the output impact of the metal cutting/melting equipment, semiconductor integrated circuit and communication equipment manufacturing industries in Hubei Province during the NIMIC construction period. #br#The results indicate that the establishment of the NICs can expand the output levels of the corresponding advanced manufacturing industries in Hubei Province.Among them, its contribution to the integrated circuit manufacturing industry is the most significant. After controlling for other possible influences, the basic conclusion remains stable. Then, this paper illustrates the parallel trend test and substitution estimation method of PSM-DID to further verify the robustness of the results and reduce the subjective selection bias. The test results of social innovation spending mechanism suggest that the establishment of national innovation centers can promote the orderly expansion of social research investment and bring about the expansive development of related advanced manufacturing industries. Specifically, the outputs of the three corresponding manufacturing industries benefit from the emergence of innovative activities, and the findings are statistically significant.#br#It is found that the capacity expansion of advanced manufacturing industries benefits from the strong radiating and driving effect of local innovation carriers. NIMICs provide a very useful innovation vehicle platform that significantly increases the probability of explosive industrial development in specific innovation areas. Therefore, it requires long-term consideration for policy makers of how to combine the characteristics of NIMICs with the advantages of local advanced manufacturing industries to develop common and key technologies and form the advantages of special industries according to local conditions. NIMICs improve innovation efficiency by revitalizing regional innovation resources. By relying on the technological advantages of existing NIMICs, they form resource aggregation and distribution, and encourage cross-regional collaborative innovation and technology transfer. Based on the national strategic positioning, NIMICs will promote key manufacturing enterprises to improve quality and expand quantity, and become bigger and stronger. These policy recommendations are expected to effectively ensure the continued advancement of the NIMIC industry in the next phase.#br#
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Received: 21 July 2021
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