Abstract: The technology diffusion effect of Beijing and Shanghai on reginal economic growth is compared through SEM and GWR model of spatial economic analysis with 31 provincial panel data from the year of 2000 to 2009. The result shows that for the most of provinces in China, the more technology diffusion from Beijing and Shanghai is, the more it promotes local economic growth. And as a whole, local economic growth effected by Beijing is higher than that by Shanghai. However, comparing with the technology diffusion of Beijing and Shanghai, local R&D and foreign technology diffusion have higher effect on local economics. In addition, the effect on local economic by the technology diffusion of Beijing and Shanghai changes with the geographical distance. This result confirms that as national heart cities, Beijing and Shanghai really play a guiding role in national economic growth. However, the elasticity values of technology diffusion for Beijing and Shanghai are still at a low level. And both technology diffusion radiation radius of Beijing and Shanghai are small, which means that provinces located around the two heart cities receive the most of their technology diffusions.

Key words: local economic growth, technology diffusion, spatial error regression, GWR regression