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Technological Decoupling ? The Impact on Innovation of US Restrictions on Chinese Firms

Author

Listed:
  • Yu Cao
  • Francesca de Nicola
  • Aaditya Mattoo
  • Jonathan David Timmis

Abstract

Recent U.S.-China tensions have raised the specter of technological decoupling. This paper examines the impact of U.S. export restrictions and technology licensing on Chinese firms’ innovation. It finds that U.S. sanctions reduce the quantity and quality of patent outputs of targeted Chinese firms, primarily due to decreased collaboration with U.S. inventors. However, firms with higher initial patent stock or in sectors with a smaller technological distance to the U.S. are less affected. Sanctions in specific technology fields lead to a decline in the patent output of both Chinese firms with U.S. collaborators and U.S. firms with Chinese collaborators.

Suggested Citation

  • Yu Cao & Francesca de Nicola & Aaditya Mattoo & Jonathan David Timmis, 2024. "Technological Decoupling ? The Impact on Innovation of US Restrictions on Chinese Firms," Policy Research Working Paper Series 10950, The World Bank.
    • Handle: RePEc:wbk:wbrwps:10950
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