With the formation of the GVC-dominated international division of labor system, export trade has become a segment of global production chains. Despite China’s massive export volume, its exports remain “large but not strong”, particularly in terms of technological sophistication. Traditional openness policies focused on commodity and factor flows may negatively affect export technological sophistication, necessitating institutional opening to enhance it. Against this backdrop, this paper examines how institutional opening affects the technological sophistication of China’s exports, clarifying how it optimizes economic factors to elevate export technological sophistication within the GVC framework.

The theoretical analysis proposes that institutional opening enhances export technological sophistication through systemic effects across the entire value chain, including promoting R&D, improving the technological content of imported intermediates, and reducing transaction costs. Building on this framework and an innovative quantitative assessment of provincial-level institutional openness, this paper employs firm-level microdata for empirical testing. The results demonstrate that institutional opening significantly improves export technological sophistication. Heterogeneity analysis further reveals variations in this effect across regions, firm ownership types, export destinations, and industries. The findings offer critical policy implications: To further enhance export technological sophistication, domestic efforts should steadfastly advance institutional opening, particularly high-level financial sector liberalization, while strengthening financial regulation to facilitate corporate investment and financing; internationally, China should actively negotiate more free trade agreements (FTAs), deepen their provisions, and expand the coverage of its FTA networks.

This paper has the following contributions: First, it employs Python-based machine learning and asynchronous web crawling techniques to construct a five-dimensional provincial institutional innovation index, alongside social network analysis to measure the breadth and depth of trade rule networks, innovatively quantifying institutional opening. Second, from a GVC perspective, it thoroughly analyzes the impact of institutional opening on export technological sophistication, transcending prior research limitations by theoretically exploring the alignment between institutional opening and efficient GVC operation. Third, based on theoretical and empirical analyses, it investigates how regional, industrial, and destination-market differences shape the heterogeneous effects of institutional opening on export technological sophistication, while extending policy insights for advancing institutional opening and upgrading export technological content.