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The Technology Gap and the Growth of the Firm: A Case Study of China's Mobile-phone Handset Industry


  • Kimura, Koichiro


We have examined the way in which local Chinese firms confronted with atechnology gap have achieved growth, using the Chinese handset industry as acase study. Chinese local firms have lacked technology, and have therefore turnedto outside firms for development, design, and manufacturing, while theythemselves have focused on sales and marketing, using their advantage offamiliarity with the Chinese market. Consequently, by establishing a growthcondition in which their selection of boundaries counterbalances the technologygap they have been able to expand their market share in comparison with foreignfirms.

Suggested Citation

  • Kimura, Koichiro, 2009. "The Technology Gap and the Growth of the Firm: A Case Study of China's Mobile-phone Handset Industry," IDE Discussion Papers 214, Institute of Developing Economies, Japan External Trade Organization(JETRO).
  • Handle: RePEc:jet:dpaper:dpaper214

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    File Function: First version, 2009
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    References listed on IDEAS

    1. Sourafel Girma, 2005. "Absorptive Capacity and Productivity Spillovers from FDI: A Threshold Regression Analysis," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 67(3), pages 281-306, June.
    2. Imai, Ken'ichi & Shiu, Jingming, 2007. "A Divergent Path of Industrial Upgrading: Emergence and Evolution of the Mobile Handset Industry in China," IDE Discussion Papers 125, Institute of Developing Economies, Japan External Trade Organization(JETRO).
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    More about this item


    Technology gap; Boundaries of the firm; Mobile-phone handset industry; China; Telephone;

    JEL classification:

    • D23 - Microeconomics - - Production and Organizations - - - Organizational Behavior; Transaction Costs; Property Rights
    • F23 - International Economics - - International Factor Movements and International Business - - - Multinational Firms; International Business
    • O12 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Microeconomic Analyses of Economic Development

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