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Regional Protection,Market Fragmentation and Capability of Industrial Technological Innovation:An Empirical Study on China's Manufactures

YU Dong-hua,WANG Qing(Economics School,Shandong University,Ji'nan 250100,China)  
This paper constructed two dimensionless variables,the industrial protected index and the industrial technological innovation capacity index,and studied the relationship between local protectionism and the industry's ability of technological innovation by taking the data of 29 manufacturing sectors in China from 2000 to 2005 as an example.It is found that local protectionism and market segmentation constrain the formation and upgrading of industrial capacity of technological innovation.Enterprises should be encouraged to increase the input on technological innovations,upgrade the industrial capability of technological innovation and enhance industrial competitiveness advantage by breaking local protectionism and market segmentation and forming a national unified market with orderly market competition.
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