How Related Variety Affects Vocational Education: Evidence From Chinese Firms

ABSTRACT This study investigates the impact of regional related variety (RV) on vocational education in Chinese firms, utilizing data from the China Industrial Enterprises Database (1998–2007). By empirically analyzing firm‐level investments in vocational training and regional industrial structures, the research demonstrates that RV significantly enhances vocational education, with firm innovation acting as a key mediator. This study employs various models to address endogeneity, ensuring robust results. The findings reveal that technological proximity among industries fosters cross‐domain skill demand, reduces training costs, and promotes collaborative education mechanisms. The contributions are threefold: (1) bridging regional economics and vocational education research by uncovering how RV shapes training content through knowledge spillovers and labor‐market mobility; (2) highlighting the role of RV in fostering regional skill‐collaboration networks; and (3) providing policy insights for optimizing talent development in dynamic industrial ecosystems.