A Random Forest Method for Identifying the Effectiveness of Innovation Factor Allocation.

ABSTRACT

This paper makes a new attempt to identify the effectiveness of innovation factor allocation with a random forest method. This method avoids the evaluation bias of the relative effectiveness caused by the noneffective selection of production frontier in the nonparametric DEA method. It does not refer to other optimal subjects but shifts the focus to the judgment of its own effectiveness. In addition, it also gets rid of the constraints of the model and variables in the parameter SFA method, ensuring the reliability of the measurement results by resampling thousands of times. The data is collected from 30 provinces in China from 2009 to 2018. The findings show the innovation factor allocation in more than half of the provinces is not fully effective. It indicates that how to make use of innovation factor inputs to achieve the actual innovation output higher than own optimal levels is currently still in a period of exploration in China. To further improve innovation factor allocation efficiency, it deeply analyzes the impacts of innovation factor inputs and finds out the important innovation factor inputs. Furthermore, this study presents the nonlinear characteristics and optimal combination of important innovation factor inputs. According to this, it offers the detailed suggestions about how to adjust current important innovation factor inputs for each province in order to greatly enhance the effectiveness of innovation factor allocation in the future.