As students of contemporary China know, the concept of “innovation” (chuang xin) has become ubiquitous in public discourse. While the term is applied to everything, from government reform, to enterprise management, to popular culture, its official promotion is derived from China's commitment to build technological capabilities. And, it is this technological innovation which is the concern of economist Xiaolan Fu.
In studies of technological innovation in developing countries, including those focused on China, a long-standing debate has involved the relative importance of imported foreign technology versus indigenous innovation for meeting the technological needs of society. Fu has acquainted herself admirably with the extensive literature on this subject and makes this debate a key organizing principle for the book. She argues, rightly, that China's path to innovation should be understood as involving both the exploitation of technologies in the international environment and a robust commitment to building capabilities for its own research and development (R&D) and indigenous innovative capabilities. But, in discussions of China's approach to innovation, the specific characteristics associated with this path have sometimes been obscure and contested. This is particularly true with regard to the modalities of international technology transfers to China, to problems of assimilating foreign technology, and to the relative importance of foreign technology versus indigenous innovation at different stages of national development. Fu takes the challenges of shedding light on these issues seriously, and the book itself is organized into three sections dealing respectively with early technological take off, the building of indigenous capabilities during a catch-up phase, and the challenges of becoming a leader in “radical” innovations which set new technological trajectories.
Most of the chapters in the book are derived from previously published journal articles dating from 2008 to 2014. As a result, the volume has several distinct styles. Some involve technical econometric analysis of data from the first decade of the 21st century, with several chapters based on a 2008 enterprise survey conducted by the National Bureau of Statistics. Although one wishes, at times, for more recent data, these chapters are often provocative, especially as the econometric analysis teases out the relative importance of different factors contributing to the development of technological capabilities (various forms of foreign direct investment, the acquisition of tacit vs. codified knowledge, the impacts of enterprise ownership and firm size, etc.). Other chapters present case studies: the optical fibre industry, photo-voltaic (PV) solar panels, and accounts of Huawei and ZTE experiences in technological learning. The third section of the book identifies some of the well-known problems China faces in becoming a leader in radical innovation; many of her suggested solutions resemble measures introduced in key reform documents issued over the past two years. Together with the introductory discussion in chapter two, the chapters in this final section can be read as thoughtful overviews of where China stands in its quest for innovation.
The book represents the work of a well-schooled economist, and the analysis reflects the methods and foci of her discipline. Readers interested in the broader historical and political contexts of China's path to innovation may therefore feel some disappointment. Little is said, for instance, about the legacy of technological capabilities from the Maoist era and, more importantly, the role of national security and techno-nationalist influences on determining the Chinese path. While reference is made to the economic reforms, the complex challenges of reforming the science and technology institutions receive only limited attention. Chinese policies for science and innovation are treated quite selectively, with virtually nothing said about the role of national R&D programmes which have been so important in channelling (with mixed results, to be sure) government support for innovation.
Although the book contains case material, the contexts in which the cases are analysed are not explored. For instance, in the interesting chapter on fibre optical cable, one wonders whether Western export controls played a role in limiting the availability of core technologies and thus became a driver of Chinese policy to support indigenous efforts. In the PV solar case, we are told that the leading Chinese companies were R&D intensive, but no mention is made of government programmes in supporting enterprise R&D. More often than not, when Fu writes about the “role of government,” she is focused mainly on the role of state-owned enterprises, a subject of importance to be sure, but hardly the complete story of China's state directed research and innovation policies. Fu's chapter on the role of universities offers original insights into their functions in assisting enterprises in absorbing foreign technology. However, the activities of foreign companies in supporting university research and the collaborations between university-based scientists in China and scientists at leading universities abroad, especially those in the US, are not addressed in spite of the fact that both have significantly enhanced the role of Chinese universities as agents of innovation.
Thus, the “path” is not completely “marked.” But, by bringing together in one place a series of suggestive technical papers which add depth to our understanding of the different phases of China's post-Mao technological development, and by synthesizing aspects of the wider discourse on the “path to innovation,” the volume is a useful contribution to the rapidly expanding literature on innovation in China.
