The Effects of Government R&D Investment and Policy Ambiguity on Regional Innovation: Evidence from China

The objective of this study is to assess the impact of government R&D investment (GRD) and innovation policy ambiguity (POL) as initiatives undertaken by governments, on the advancement of regional innovation. This study is conducted in the framework of the Regional Innovation System (RIS) approach, which comprises two phases: knowledge production (KNO) and innovation commercialization (COM). This research constructs a comprehensive framework to empirically explore the interrelationship of GRD, POL, KNO, and COM. The framework is subjected to rigorous analysis employing robust standard error estimation and diverse regression models, utilizing panel data including a span of ten years (2009-2019) from thirty provinces in China. The findings of this study reveal that the influence of GRD on COM is mediated by the process of KNO. Moreover, the presence of POL positively moderates the relationship between GRD and KNO, while it does not exert a moderating effect on the relationship between KNO and COM. Notably, the impact of GRD on KNO and the effect of KNO on COM are subject to the threshold effect of POL. Specifically, an intermediate level of POL demonstrates a superior capacity to enhance the efficacy of GRD on KNO and the efficiency of KNO on COM. This study significantly contributes to the understanding of the effect of government initiatives pertaining to GRD and POL on RIS in the context of a transitioning economy.