Many models of institutional transition and regional economic development with distinctive regional styles emerge during China's economy growth with transition, which is named the Phenomenon of Regional Breakthrough by us. We hold that only to understand this phenomenon, can we understand the basic experience of China's economic transition. To regard this phenomenon as one process of renovation from the perspective of the growing of small and middle enterprise, a new analysis framework was founded based on introducing the factor of location in this paper to explain the institutional causes of this phenomenon.