The changing role between public and private R&D investments in regional innovation: threshold analysis from Guangdong, China

The main contribution of our study is to build a bridge to the study of research and development (R&D) inputs in regional innovation systems and at the same time to provide an important reference case for regional innovation policy in transition countries. Our study finds that: (1) The positive effects of both public and private inputs rely on a rich local knowledge base and strong innovation networks. (2) Public inputs effectively contribute to the increase of private inputs, especially for regions in the early stages of a regional innovation system. (3) The relationship between public and private inputs is non-linear, and when public inputs continue to increase beyond a certain point, it will in varying degrees weaken the positive effect of private sector inputs.