Abstract:This paper constructed a theoretical analysis framework on the spatial agglomeration of producer services promoting the innovation-driven development.Based on the panel data of 30 provinces in China from 2003 to 2014,and using spatial panel econometric model,this paper empirically researched on how the specialization and diversification agglomeration of producer services promote technology as well as institutional innovation.The result shows that both specialization and diversification agglomeration of producer services have significant spillover effects over regional innovative capability,especially over innovation within producer services mainly through specialization agglomeration.Compared with institutional innovation,agglomeration of producer services intensively promotes regional technology innovation.Meanwhile,the spatial spillover effect of technology innovation also plays an important role in regional innovative capability