The Journal of Technology Transfer

, Volume 32, Issue 1–2, pp 63–85 | Cite as

Product innovation and process innovation in SOEs: evidence from the Chinese transition

  • Yuan Li
  • Yi Liu
  • Feng Ren


This paper offers an analysis of the influence of management behavior on the relationship between factors such as market, governance and resources of a firm, and the choice of the type of technological innovation in Chinese state-owned enterprises (SOEs). The authors develop a structural equation model and 12 hypotheses and test the model and hypotheses using a sample of 274 SOEs in China. This study discovers that the choice of innovation types among Chinese SOEs depends on the turbulence in the environment, and on the organizational resources. The key contributions of the study include: testing existing theories of innovation in the context of Chinese SOEs; studying the factors that affect product innovation and process innovation in that context; and demonstrating that market forces and internal governance simultaneously influence SOE innovation.


Product innovation Process innovation State-owner enterprise China 

JEL Classifications

M1—Business administration O31—Innovation and invention: processes and incentives O32—Management of technological innovation and R&D 



The Natural Science Fund of China (NNSC: 79925004, 70271026) provided financial support for this study. We thank Mingfang Li and George Farris for their insightful comments and suggestions.


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Copyright information

© Springer Science+Business Media, LLC 2006

Authors and Affiliations

  1. 1.School of ManagementXi’an Jiaotong UniversityXi’anPR China
  2. 2.Department of MarketingXi’an Jiaotong UniversityXi’anPR China

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