Digital Connectivity and Cross-border Collaborative Innovation

Speaker：Yu Zhihong, Associate Professor, University of Nottingham

Host：Li Bing, Professor, Lingnan College

Time and Date：10:00, June 15, 2026 (Monday)

Venue：Wang Dao Han Conference Room (101), Lingnan Hall

Language：Chinese

Abstract：

This paper examines how international digital connectivity affects cross-border collaborative innovation. Focusing on the global expansion of fiber-optic submarine cables, we argue that improved digital infrastructure reduces communication costs and facilitates international knowledge exchange. Using a novel worldwide firm-country-year panel from 1988–2018, we measure collaborative innovation using international co-patents. Exploiting the staggered deployment of submarine cables across country pairs, we estimate the causal effect of digital connectivity using a difference-in-differences framework. We find that submarine cable connections significantly increase cross-border collaborative innovation. The results remain robust across alternative specifications and staggered DiD estimators. We further show that digital connectivity promotes breakthrough innovation measured by highly cited patents. The effects are stronger for firms with multinational ownership links and weaker when the development gap between countries is larger. Overall, the paper highlights the important role of global digital infrastructure in facilitating international knowledge flows and innovation.

Profile:

Yu Zhihong holds a Ph.D. in Economics from the University of Nottingham, UK, and serves as an Associate Professor at the School of Economics and Deputy Editor-in-Chief of The World Economy. His primary research focuses on international trade, international investment, and China's economy. His publications have appeared in top-tier economics journals such as the Review of Economies and Statistics, Journal of International Economies, European Economic Review, and Economic Theory. He also serves as an anonymous reviewer for journals including the Quarterly Journal of Economics.