“…Our study contributes to the literature in three ways: First, we focus on the R&D effect of ITI in the context of a developing country-China, thereby complementing the existing studies which mainly investigate the influence of human mobility on patents (Liu et al, 2010;Filatotchev et al, 2011), on knowledge transfer across borders (Liu et al, 2015), and on outward FDI (Gao et al, 2013). Second, while the existing studies are based on State-level panel data (Faggian and McCann, 2009;Ozgen et al, 2014;Jahn and Steinhardt, 2016;Bratti and Conti, 2018), industry-level data (Fassio et al, 2019), time-series data (Chellaraj et al, 2008), cross-section survey data (Filatotchev et al, 2011;Liu et al, 2010;Gagliardi, 2015), or individual interview data (Liu et al, 2015;Zheng and Ejermo, 2015), we use a detailed and unbalanced panel database with rich information on 338,242 Chinese manufacturing firms from 2004 to 2007. It not only has a large number of observations, but also includes both the time dimension and the cross-section dimension.…”