Unpacking technology flows based on patent transactions: does trickle-down, proximity, and siphon help regional specialization?

The spatial concentration of knowledge production leads to increased regional inequality, but technology flows have the potential to improve the distribution of innovation. This study examines the role of technology flows in regional specialization at the technology level in China during 2005–2016 using patent data. To unpack technology flows, we distinguish three directions based on patent transactions: trickle-down, proximity and siphon. Results show that regions are more likely to specialize in technological activities, which exhibit a greater number of external linkages characterized by relatively low relatedness and a limited number of strong links. Access to external technological linkages is identified as a key pathway for less innovative regions to achieve place breakthroughs. The technology flows of trickle-down help less innovative regions specialize in more complex technologies than their local knowledge base, while siphon does not significantly impact place breakthroughs in innovative regions.