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Enhancing China's Innovation Performance: The Policy Choices

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  • Xiaolan Fu
  • Rongping Mu

Abstract

Transforming China into an innovation-driven economy has been one of the top priorities of the Chinese Government. This paper examines the policy choices involved in the extended national innovation performance framework for creating an open innovation system. Innovation capabilities, incentives and institutional frameworks are examined. The paper argues that China should continue to increase its investment in R&D and in education, and that there should also be an attempt to strengthen the incentive system at the macro, meso and micro levels. This strengthening may include reforms to: release the power of competition and guide resources towards innovative sectors; adopt appropriate human resource management, such as appraisal and remuneration systems; create effective policies for research funding management; and evaluate the efficiency of research to encourage the creativity of researchers, managers and employees. The paper also discusses the space for industrial policy in the 21st century.

Suggested Citation

  • Xiaolan Fu & Rongping Mu, 2014. "Enhancing China's Innovation Performance: The Policy Choices," China & World Economy, Institute of World Economics and Politics, Chinese Academy of Social Sciences, vol. 22(2), pages 42-60, March.
  • Handle: RePEc:bla:chinae:v:22:y:2014:i:2:p:42-60
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    File URL: http://hdl.handle.net/10.1111/j.1749-124X.2014.12061.x
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    References listed on IDEAS

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    1. Lall, Sanjaya, 1992. "Technological capabilities and industrialization," World Development, Elsevier, vol. 20(2), pages 165-186, February.
    2. Rongping Mu & Yonggang Fan, 2011. "Framework for building national innovation capacity in China," Journal of Chinese Economic and Business Studies, Taylor & Francis Journals, vol. 9(4), pages 317-327, August.
    3. Fu, Xiaolan & Pietrobelli, Carlo & Soete, Luc, 2011. "The Role of Foreign Technology and Indigenous Innovation in the Emerging Economies: Technological Change and Catching-up," World Development, Elsevier, vol. 39(7), pages 1204-1212, July.
    4. Xiaolan Fu, 2008. "Foreign Direct Investment, Absorptive Capacity and Regional Innovation Capabilities: Evidence from China," Oxford Development Studies, Taylor & Francis Journals, vol. 36(1), pages 89-110.
    5. Xiaolan Fu & Jing Zhang, 2011. "Technology transfer, indigenous innovation and leapfrogging in green technology: the solar-PV industry in China and India," Journal of Chinese Economic and Business Studies, Taylor & Francis Journals, vol. 9(4), pages 329-347, August.
    6. Krause, Lawrence B, 1988. "Hong Kong and Singapore: Twins or Kissing Cousins?," Economic Development and Cultural Change, University of Chicago Press, vol. 36(3), pages 45-66, Supplemen.
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    Cited by:

    1. Yin He & Bin Li & Yunhua Tian & Lijun Wang, 2016. "Does Foreign Venture Capital Provide More Value-added Services to Initial Public Offering Companies in China?," China & World Economy, Institute of World Economics and Politics, Chinese Academy of Social Sciences, vol. 24(2), pages 90-106, March.
    2. Othmani, Abdelhafidh & Ben Yedder, Nadia & Bakari, Sayef, 2023. "The Cointegration Relationship between Patent, Domestic Investment and Economic Growth in United States of America," MPRA Paper 118245, University Library of Munich, Germany.

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