Abstract:To further clarify the continuous dynamic mechanism of technology transfer of SMEs in the agglomeration area, so as to provide a reference for them to improve their technology absorption and diffusion capacity and thus improve their innovation performance. Based on the Roundabout production, a model including external market competition, internal development motivation, regional strategic synergy, roundaboutness change of productive structure, technology absorption, technology diffusion and enterprise performance was constructed from the perspective of roundaboutness change of productive structure. The hypotheses were tested using 411 valid questionnaires of SMEs in the Yangtze River Delta. The results show that technology absorption and diffusion of SMEs in the agglomeration zone significantly affect enterprise performance. Roundaboutness change of productive structure has a significant positive effect on technology absorption and diffusion of SMEs, and is influenced by three factors: external market competition, internal development motivation and regional strategy coordination. Therefore, SMEs should pay attention to roundaboutness change of productive structure, enhance the ability of technology absorption and diffusion, market competitiveness and adaptability, and strengthen business innovation, and thus promote the steady development of enterprises.