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While prior research has focused upon the role of university-industry linkage in the promotion of innovation, there has been little research distinguishing the different roles of domestic and foreign universities in this pursuit. This paper explores the different impacts of domestic and foreign universities on innovation performance in emerging economies using a national firm-level survey database from China. It finds that international innovation collaboration with leading universities in other developing countries, especially with those in the Newly Industrialised Economies (NIEs) and the emerging South, is fruitful in enhancing the creation of ground-breaking innovations in indigenous Chinese firms. In contrast, the contribution of universities in the US/EU/Japan is significantly beneficial to foreign-invested firms. Collaboration with domestic universities has played a significant role in the diffusion of advanced technology in China

Collaboration with foreign universities for innovation: evidence from Chinese manufacturing firms