China's Regional Inequality in Innovation Capability, 1995–2006

Abstract This paper assesses both interregional and intraregional innovation inequality in China from 1995 to 2006. It is revealed that the east–central–west inequality has increased over time, whereas the inter‐provincial inequality showed a V‐pattern until 2003; Both inequality measures oscillated from 2004 to 2006. Using a decomposition framework recently developed by one of the authors, we determined that the major factors driving innovation inequality are population, economic development level, R&D, location and openness. The aggravated innovation inequality reflects the growth of China's innovation centers in the eastern region and their admission into the global innovation networks. The fact that R&D is a major factor driving the inequality suggests that, considered in the present study, the efficiency of R&D investment improved in certian regions during the period (1995–2006). Finally, geographic location and openness affect innovation inequality primarily through the coupled evolution of innovation capability and economic development, resulting in first‐mover advantages to provinces of the eastern region.