Relational characteristics and dynamics between high-tech firms in the Pearl River Delta and the empowerment for technological innovation by Hong Kong

Abstract

<p>The perfection of the cross-border regional innovation system of the Pearl River Delta (PRD) and Hong Kong remarkably underpins the construction of the Guangdong-Hong Kong-Macao Greater Bay Area (GBA) towards an international technological innovation hub. This paper focuses on the relational characteristics of the usage of technological innovation functions and elements, including labor force, technology, and producer services from Hong Kong by high-technology firms in the PRD, and probes into the influencing factors by integrating the objective perspective on the impact of firm-level socioeconomic attributes and subjective perspective on the open interpretations on the reasons by using or not using technological innovation functions and elements from Hong Kong by various stakeholders in high-technology domains in the PRD. Key research findings are fourfold. First, Hong Kong’s technological innovation functions primarily ride on its institutional advantages under the “One Country, Two Systems” framework to empower high-technology firms in the PRD by expanding their international market, international business operation, and financing, but cross-border investment and entrepreneurship has retrieved to a relatively marginalized position. The degree of supply-demand relations of producer services is the highest, followed by labor force and technology. Second, Hong Kong-invested, large-sized, and long-standing high-technology firms in the PRD are more inclined to use technological innovation elements from Hong Kong, while domestic, small-and-medium-sized, and start-up high-technology firms in the PRD are in turn, gradually unhooked from the supply of technological innovation elements from Hong Kong. Third, Hong Kong enjoys both advantages and disadvantages in supplying labor forces, technologies, and producer services to high-technology firms in the PRD, with advantages in competitiveness, international linkages and visions, and disadvantages in high cost, lack of more profound mutual understanding between Hong Kong and the PRD, and the imperfect cooperation mechanisms. Fourth, interactions among the transitioning role of Hong Kong in the macro-level global and national economic development landscape, meso-level cross-border regional specificities under the “One Country, Two Systems” framework, and micro-level heterogeneous practices and capabilities of firms influence the usage of technological innovation functions and elements from Hong Kong by high-technology firms in the PRD.</p>