Channels to innovation: The Chinese experience in the automotive sector

China is nowadays the first market and producer in the automotive sector. However, Chinese actors still look not able to compete internationally with the global champions of the sector, both as automakers and component-makers. In this context, we analyse the policies for technological upgrading of the sector, on which national government have greatly focused since the mid-Eighties. One of the main tools used by national authorities to foster the technological endowment of national firms is the sector opening to foreign actors, specifically through joint ventures. Lately, however, growing emphasis on endogenous technology, and more generally on internal markets, national firms and indigenous sources, has been put in national industrial plan on the sector. After the analysis of the story of Chinese policy interventions in this field, we focus on firm level data to verify empirically the differences in terms of innovation activity of different groups of firms in the Chinese market, distinguishing among joint ventures, wholly-Chinese and wholly-foreign owned.