RESEARCH ON THE EVALUATION OF INNOVATION CAPABILITY OF INDUSTRIAL ENTERPRISES IN CHINA'S PROVINCES BASED ON FACTOR ANALYSIS AND CLUSTER ANALYSIS

Through the creation of 4 primary indicators "contribution of innovation", "result of innovation" and "innovation of the internal and external environment" and 11 secondary indicators, a system of assessment indices was created for the potential of industrial innovation in China. The method of factor analysis and the method of cluster analysis are combined to assess the innovative ability of industrial enterprises in 30 provinces and cities in 2016. The study shows that the innovative capacity of industrial enterprises in the southeast has a strong advantage over other regions, which is mainly reflected in high investment and production of industrial enterprises. The low industrial innovation potential of the central region is mainly due to insufficient investment and unfavorable innovation environment, and the domestic innovation environment in the western region needs to be improved. Based on this, this article makes proposals for promoting innovation and the development of industrial enterprises in China.