The impact of patent protection on technological innovation: A global value chain division of labor perspective

Technological innovation is the core competitiveness of a country's comprehensive national power, and patent protection is the institutional guarantee to stimulate enterprises' technological innovation. Considering the technology spillover effect brought by a country's participation in global value chains (GVCs), this study places the patent system in the context of international production segmentation, and utilizes the industry panel data of China's manufacturing industries from 2000 to 2014 and 2007-2021 respectively, constructs the two-way fixed effects model, the interaction term model, and the panel threshold model in turn, to demonstrate the stage impact of the patent system when China's manufacturing industries are in different positions in GVCs. It is found that: strengthening patent protection can significantly improve the level of technological innovation in China's manufacturing industries, especially for high-tech industries; the innovation incentive effect of patent protection is increasing as the manufacturing industry climbs to the high-end of GVC; when the GVC status of the manufacturing industry crosses the threshold, the positive promotion effect of patent protection on the level of technological innovation will be substantially increased. The findings of the article show that institutional policies to incentivize technological innovation should be closely aligned with national needs and be responsive to social progress.