The quality of imported intermediate inputs and firms? innovation activities in China

Using firm-level data in China from 2000 to 2009, this paper studies the connection between the quality of imported intermediate inputs and firms' innovation activities. Our estimations find that importing high-quality intermediate inputs tends to increase the quantity of firms' invention patent. The private firms, firms engaged in processing trade, and firms importing from high-income economies benefit more from importing high-quality intermediate inputs. Our results are supported by a series of robustness checks.(c) 2022 Elsevier B.V. All rights reserved.