Andrew Tylecote：Challenges of innovating firms.pptVIP

Tylecote-Sheffield-Corporate governance+crisis of Chinese technology policy Shifts in governance….2006: Challenges of innovating firms Andrew Tylecote University of Sheffield, UK a.tylecote@shef.ac.uk China’s Activist Technology Policy, 1978-2005 Export low-technology manufactures Spend foreign exchange (and taxes) on building up higher-tech industry behind tariff wall (and barriers to FDI). Flout intellectual property rules – like US in early 19th century. WTO entry severely restricts all this. The failure of the activist policy Tiny bridgehead established of Chinese firms producing their own high-technology products. Very low rate of patenting by Chinese firms. Not associated with main export sectors (including ICT). The failure of the ‘national team’ of 100 large favoured firms. Greater success of ‘outsiders’ like Lenovo and Huawei. Chinese ‘outsider’ firms generally supply mass consumer markets – not under government control. Beware of the data on ICT (1) ‘ICT industry’ = ISIC Revision 3 Office, accounting computing machinery (IT hardware) 30 Radio, TV communications equipment (incl. chips other components 32 Software and IT services 72 Beware of the data (2) Sales/output figures are gross. China specialises in assembly operations and low-value components, importing high-value ones. Don’t look at gross exports. Look at trade balance. ICT industries’ performance in China Only telecoms has done well in technological capability of domestic firms. Telecoms exception: stress on independent development from mid-80s. Record on computers, arguable. IT hardware + ‘electronics’: ideal location for low-wage insertion into Asia-Pacific value chains. ’High reliance on FDI for maintaining export rates and aiding privatisation of SOEs..inhibited growth of ..private sector….by missing backward linkages and low domestic content of export