Geographical Concentration of Knowledge- and Technology-Intensive Industries and City Innovation in China

Economic transformation and re-industrialization constantly change the geographical landscape of knowledge- and technology-intensive industries (KTI) globally, and the role of KTI agglomeration in city innovation is becoming increasingly decisive. Based on the employment data with a two-digit code in China's 2010 Population Census, this paper compares the spatial difference between absolute and relative concentration of knowledge-intensive business service (KIBS) and technology-intensive manufacturing (TIM) in prefecture-level units, and interprets the diverse impact of KIBS and TIM specialisation on innovation in 286 prefecture-level cities. Results indicate that KIBS is concentrated mainly in the provincial capital cities, while the level of KIBS specialisation exceeds the national average in some border cities of the northwestern region and resource-based cities of the northeastern region. Unlike KIBS, TIM is highly concentrated in the Yangtze River Delta, the Pearl River Delta, and the Beijing-Tianjin and Shandong Peninsula urban agglomerations. KIBS specialisation matters more in boosting city innovation than does TIM specialisation, and TIM specialization exerts a significant positive spatial spillover effect on city innovation. Our empirical results could be considered by policy-makers for the development of KTI and the promotion of city innovation.