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Editor's Choice Institutional change and productivity growth in China’s manufacturing: the microeconomics of knowledge accumulation and "creative restructuring"

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Listed:
  • Xiaodan Yu
  • Giovanni Dosi
  • Jiasu Lei
  • Alessandro Nuvolari

Abstract

This article investigates the microeconomics underlying the spectacular growth of productivity in China’s manufacturing sector over the period 1998–2007. Underlying the aggregate evidence of such dramatic growth, one observes a large, albeit shrinking, intra-sectoral heterogeneity coupled with an even more important process of learning and knowledge accumulation. A major process of both catching-up and dying out among the least efficient ones occurs. Furthermore, we explore the effect of the characteristics of firms according to the ownership and governance structure upon the productivity distributions, highlighting the importance of the transformation of domestic firms as drivers of technical learning. In essence, China’s fast catching-up process entails more of learning and "creative restructuring" of domestic firms rather than sheer "creative destruction" and even less so a multinational corporation-led drive.

Suggested Citation

  • Xiaodan Yu & Giovanni Dosi & Jiasu Lei & Alessandro Nuvolari, 2015. "Editor's Choice Institutional change and productivity growth in China’s manufacturing: the microeconomics of knowledge accumulation and "creative restructuring"," Industrial and Corporate Change, Oxford University Press and the Associazione ICC, vol. 24(3), pages 565-602.
    • Handle: RePEc:oup:indcch:v:24:y:2015:i:3:p:565-602.
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    File URL: http://hdl.handle.net/10.1093/icc/dtv011
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    Citations

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    Cited by:

    1. Jürgen Meckl & Ivan Savin, 2018. "Factor-Biased Technical Change and Specialization Patterns," Central European Journal of Economic Modelling and Econometrics, Central European Journal of Economic Modelling and Econometrics, vol. 10(2), pages 75-100, June.
    2. Daniele Moschella & Federico Tamagni & Xiaodan Yu, 2019. "Persistent high-growth firms in China’s manufacturing," Small Business Economics, Springer, vol. 52(3), pages 573-594, March.
    3. Giovanni Dosi & Xiaodan Yu, 2017. "Technological catching-up, sales dynamics and employment growth: evidence from China's manufacturing firms," LEM Papers Series 2017/27, Laboratory of Economics and Management (LEM), Sant'Anna School of Advanced Studies, Pisa, Italy.
    4. Giovanni Dosi & Xiaodan Yu, 2018. "Capabilities Accumulation and Development: What History Tells the Theory," LEM Papers Series 2018/27, Laboratory of Economics and Management (LEM), Sant'Anna School of Advanced Studies, Pisa, Italy.
    5. Dosi, G. & Piva, M. & Virgillito, M.E. & Vivarelli, M., 2021. "Embodied and disembodied technological change: The sectoral patterns of job-creation and job-destruction," Research Policy, Elsevier, vol. 50(4).
    6. Richard Harris & Nigar Hashimzade & Sai Ding, 2016. "Political Connections, State Ownership and Productivity in China," CESifo Working Paper Series 6236, CESifo.
    7. Dosi, Giovanni & Riccio, Federico & Virgillito, Maria Enrica, 2021. "Varieties of deindustrialization and patterns of diversification: why microchips are not potato chips," Structural Change and Economic Dynamics, Elsevier, vol. 57(C), pages 182-202.
    8. Heijs, Joost & Arenas Díaz, Guillermo & Vergara Reyes, Delia Margarita, 2019. "Impact of innovation on employment in quantitative terms: review of empirical literature based on microdata," MPRA Paper 95326, University Library of Munich, Germany.
    9. Heinrich, Torsten & Dai, Shuanping, 2016. "Diversity of firm sizes, complexity, and industry structure in the Chinese economy," Structural Change and Economic Dynamics, Elsevier, vol. 37(C), pages 90-106.
    10. Flavio Calvino & Maria Enrica Virgillito, 2018. "The Innovation†Employment Nexus: A Critical Survey Of Theory And Empirics," Journal of Economic Surveys, Wiley Blackwell, vol. 32(1), pages 83-117, February.
    11. Federico Riccio & Giovanni Dosi & Maria Enrica Virgillito, 2023. "Smile without a reason why: functional specialisation and income distribution along global value chains," LEM Papers Series 2023/31, Laboratory of Economics and Management (LEM), Sant'Anna School of Advanced Studies, Pisa, Italy.
    12. Giovanni Dosi & Mariacristina Piva & Maria Enrica Virgillito & Marco Vivarelli, 2019. "Technology and employment in a vertically connected economy: a model and an empirical test," DISCE - Quaderni del Dipartimento di Politica Economica dipe0005, Università Cattolica del Sacro Cuore, Dipartimenti e Istituti di Scienze Economiche (DISCE).
    13. Nanditha Mathew, 2017. "Drivers of firm growth: micro-evidence from Indian manufacturing," Journal of Evolutionary Economics, Springer, vol. 27(3), pages 585-611, July.
    14. Nilsen, Øivind A. & Raknerud, Arvid & Iancu, Diana-Cristina, 2020. "Public R&D support and firm performance: A multivariate dose-response analysis," Research Policy, Elsevier, vol. 49(7).
    15. Luna, Ivette & Hiratuka, Celio & Haddad Netto, Elias Youssef, 2016. "Survival of the fittest or does size matter: What are the main drivers of Productivity in Brazil?," MPRA Paper 78208, University Library of Munich, Germany, revised 2016.
    16. Alex Coad & Marc Cowling & Josh Siepel, 2017. "Growth processes of high-growth firms as a four-dimensional chicken and egg," Industrial and Corporate Change, Oxford University Press and the Associazione ICC, vol. 26(4), pages 537-554.
    17. Giovanni Dosi & Dario Guarascio & Andrea Ricci & Maria Enrica Virgillito, 2021. "Neodualism in the Italian business firms: training, organizational capabilities, and productivity distributions," Small Business Economics, Springer, vol. 57(1), pages 167-189, June.
    18. Yu, Xiaodan & Dosi, Giovanni & Grazzi, Marco & Lei, Jiasu, 2017. "Inside the virtuous circle between productivity, profitability, investment and corporate growth: An anatomy of Chinese industrialization," Research Policy, Elsevier, vol. 46(5), pages 1020-1038.

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