Knowledge Diffusion Capability Generation for Under-Developed Regions´ Economic Development

Knowledge diffusion is one of the key factors that improves the research and development of knowledge and the competence of any regional economy. This paper firstly explains the concept of knowledge diffusion, and then focus on the underdeveloped regions to analyze the constraint factors that determine a region´s knowledge diffusion capability with the establishment of a two-layer model compromising both the external factors (environments) and the internal factors (resources).Then the impact of knowledge diffusion on regional industries upgrading in the form of international industrial transfer is analyzed as well. The conclusion gives suggestions on the strategies of developing regions to utilize the principles of knowledge diffusion.