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Based on a survey adapted from the Fourth European Community Innovation Survey (CIS-4), this paper finds that, in the changing manufacturing environment of Guangdong province in China, Hong Kong-owned businesses that generate a higher share in new product sales as a percentage of total sales or engage in R&D or collaborative innovation activities in China are more likely to survive and remain in Guangdong. The paper fills a gap in the literature by investigating the effects of innovation on the survival and relocation of Hong Kong-owned manufacturing firms in Guangdong. The results support policy initiatives that strengthen collaborative ties among key innovation system actors.
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