| Abstract | According to the novelty, technological innovation can be divided into incremental innovation and breakthrough innovation. China is no lack of incremental innovation, but seriously short of breakthrough innovation, but the key to realize the transition from "made in China" to "created in China" is having more breakthrough innovation. The existing literatures of researching Chinese enterprises’ innovation paid little attention to the heterogeneity of incremental innovation and breakthrough innovation. Based on innovation heterogeneity assumption, using China's high technology industry data from 2001 to 2010, we constructed a dynamic panel data model to analysis and compare the influence of enterprise scale, market structure, ownership on the incremental innovation and breakthrough innovation behavior. The results show that there are significant differences between the incremental innovation and breakthrough innovation. Compared to incremental innovation, breakthrough innovation are knowledge-intensive activities，R&D personnel have a significant positive influence on breakthrough innovation. Firm size has a significant role in promoting breakthrough innovation, but this relationship comes mainly from the non-state-owned enterprises, rather than state-owned enterprises. For both state-owned and non-state-owned enterprises, enterprise scale has a certain extent on incremental innovation. At the same time, competition in the market will promote the incremental innovation, and suppress the breakthrough innovation. |