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The Role Of Small Firms In China’S Technology Development

  • Lundin, Nannan

    (European Institute of Japanese Studies)

  • Sjöholm, Fredrik

    ()

    (European Institute of Japanese Studies)

  • Qian , Jinchang

    (National Bureau of Statistics of China)

Science & Technology (S&T) is high on the Chinese policy agenda but there are large uncertainties on the actual S&T development. For instance, previous studies tend to focus only on large and medium-sized enterprises (LMEs). The situation in Chinese small firms is far less explored. This paper aims to examine the role of S&T-based small firms. More precisely, we examine how much S&T that has been accounted for by small firms and how their S&T intensity differs across industries and ownership groups. We also analyze how various firm characteristics differ over size categories and S&T status. This study is based on newly processed micro level data provided by the National Bureau of Statistics with information on a large number of S&T indicators for small-, medium-, and large-sized manufacturing firms in China in 2000 and 2004. Our results suggest that small firms in Chinese S&T resemble their role in many other countries. They account for a comparably small share of total S&T and most small firms are not engaged in any S&T. However, those small firms that do engage in S&T tend to be more S&T intensive and have a higher output in terms of patents than larger Chinese S&T firms.

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File URL: http://swopec.hhs.se/eijswp/papers/eijswp0227.pdf
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Paper provided by The European Institute of Japanese Studies in its series EIJS Working Paper Series with number 227.

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Length: 35 pages
Date of creation: 15 Aug 2006
Date of revision:
Publication status: Published as Lundin, Nannan and Fredrik Sjöholm, 'THE ROLE OF SMALL FIRMS IN CHINA’S TECHNOLOGY DEVELOPMENT' in The World Economy, 2010, pages 1117-1139.
Handle: RePEc:hhs:eijswp:0227
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  1. Jovanovic, Boyan, 1982. "Selection and the Evolution of Industry," Econometrica, Econometric Society, vol. 50(3), pages 649-70, May.
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  7. Russell Cooper & John Haltiwanger & Laura Power, 1995. "Machine Replacement and the Business Cycle: Lumps and Bumps," NBER Working Papers 5260, National Bureau of Economic Research, Inc.
  8. Ericson, Richard & Pakes, Ariel, 1995. "Markov-Perfect Industry Dynamics: A Framework for Empirical Work," Review of Economic Studies, Wiley Blackwell, vol. 62(1), pages 53-82, January.
  9. Cohen, Wesley M & Klepper, Steven, 1996. "Firm Size and the Nature of Innovation within Industries: The Case of Process and Product R&D," The Review of Economics and Statistics, MIT Press, vol. 78(2), pages 232-43, May.
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