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Betting on indigenous innovation or relying on FDI: The Chinese strategy for catching-up

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  • Tang, Mingfeng
  • Hussler, Caroline

Abstract

This paper characterizes the national innovation system (NIS) built up in China and analyses whether this NIS is helpful for China to catch up. Our research methodology is based on the combination of the theoretical contributions of the new growth theory and the NIS approaches, but also benefits from empirical evidence collected during an OECD research project targeted at the study of the Chinese NIS. We find that the Chinese NIS is composed of two complementary building blocks: an FDI-based innovation system and an indigenous innovation system. If both systems are shown to have a positive influence on China’s catching-up process, the indigenous innovation system however does not seem as influential as the FDI-based one. We suggest that the Chinese NIS should be reconsidered and designed in such a way to be able to improve the absorption and innovation capability of domestic firms and to strengthen university–enterprise interactions.

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  • Tang, Mingfeng & Hussler, Caroline, 2011. "Betting on indigenous innovation or relying on FDI: The Chinese strategy for catching-up," Technology in Society, Elsevier, vol. 33(1), pages 23-35.
    • Handle: RePEc:eee:teinso:v:33:y:2011:i:1:p:23-35
    DOI: 10.1016/j.techsoc.2011.03.001
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    4. Shahid Yusuf, 2012. "From Technological Catch-up to Innovation : The Future of China’s GDP Growth," World Bank Publications - Reports 12781, The World Bank Group.
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    8. Jiang, Marshall S. & Branzei, Oana & Xia, Jun, 2016. "DIY: How internationalization shifts the locus of indigenous innovation for Chinese firms," Journal of World Business, Elsevier, vol. 51(5), pages 662-674.
    9. H.J. Roelfsema & Y. Zhang, 2012. "Globalization and Regional Innovation," Working Papers 12-15, Utrecht School of Economics.
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    14. Chan-Yuan Wong & Xiao-Shan Yap, 2012. "Mapping technological innovations through patent analysis: a case study of foreign multinationals and indigenous firms in China," Scientometrics, Springer;Akadémiai Kiadó, vol. 91(3), pages 773-787, June.
    15. Mohd. Fayaz & Sandeep Kaur Bhatia, 2018. "Technological Intensity of Indian Exports and the Performance of Emerging Asian Economies," Emerging Economy Studies, International Management Institute, vol. 4(1), pages 62-77, May.
    16. Yu, Xiubao & Yan, Jie & Assimakopoulos, Dimitris, 2015. "Case analysis of imitative innovation in Chinese manufacturing SMEs: Products, features, barriers and competences for transition," International Journal of Information Management, Elsevier, vol. 35(4), pages 520-525.
    17. Naudé, Wim & Szirmai, Adam & Haraguchi, Nobuya, 2016. "Structural transformation in Brazil, Russia, India, China and South Africa (BRICS)," MERIT Working Papers 2016-016, United Nations University - Maastricht Economic and Social Research Institute on Innovation and Technology (MERIT).
    18. Cao, Qing, 2014. "Insight into weak enforcement of intellectual property rights in China," Technology in Society, Elsevier, vol. 38(C), pages 40-47.
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    20. Majidpour, Mehdi & Saber, Ali & Elahi, Shaban & Shayan, Ali & Sahebkar Khorasani, Seyed Mohammad, 2021. "Technological catch-up in the biopharmaceutical sector: Evidence from Iran," Technology in Society, Elsevier, vol. 67(C).
    21. Yu Huan & Md. Qamruzzaman, 2022. "Innovation-Led FDI Sustainability: Clarifying the Nexus between Financial Innovation, Technological Innovation, Environmental Innovation, and FDI in the BRIC Nations," Sustainability, MDPI, vol. 14(23), pages 1-26, November.
    22. Moralles, Herick Fernando & Moreno, Rosina, 2020. "FDI productivity spillovers and absorptive capacity in Brazilian firms: A threshold regression analysis," International Review of Economics & Finance, Elsevier, vol. 70(C), pages 257-272.

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