The role of education in regional innovation activities: spatial evidence from China

Using Chinese provincial data from 1997 to 2006, we examine the role of education in regional innovation activities. We test the spatial autocorrelation of provincial innovative activities and find significant support for it in the data, suggesting the need to incorporate spatial dependence in estimating the impact of education on innovation. We find that workers' tertiary education is significantly and positively related to provincial innovative activities measured by invention patent applications per capita. The result does not vary when spatial dependence is incorporated in the estimation. Thus, we find strong and robust evidence for the prediction of the endogenous growth theory about the positive effect of human capital on innovation.