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Technology Transfer through Imports in China

This paper examines the effects of factor accumulation, domestic R&D, and foreign technological spillovers based on the production function for industry. During the period from 1981 to 2005, the empirical research finds out that, domestic R&D stock and foreign R&D stock are significantly positive to improve Chinese industry's total factor productivity (TFP). The paper also relates technology transfer to imports, showing that imports are often a major channel for the foreign R&D to help Chinese industry's TFP. It is necessary to pay more attention to trade with the countries of high proportion of R&D to GDP and improve efficiency of domestic R&D.