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State-led choices and catch-up trajectories: implications from China's indigenous innovation and intellectual property strategy
Strategic government decisions concerning how an economy can transition from traditional trade specialization and reliance on imitation of imported knowledge to domestic technological innovation are known to influence countries' prospects for avoiding the middle-income trap and successfully catching up with industrial leaders. The successful strategies of several latecomers in East Asia compared with the failures of those of many latecomers from elsewhere highlight the importance of smart state-led choices to facilitate this process of economic transition. Within the last several years, mainland China, a middle-income economy, has embarked on its own state-led approach to catch up via a complex indigenous innovation (zizhu chuangxin) and intellectual property (IP) development strategy. Building on existing studies of technological catch-up, this Thesis focuses on how critical aspects of China's IP and innovation strategies deal with the significant challenges that China faces in its next stage of development. It focuses on how China is dealing with challenges such as moving from imitation to innovation, and enhancing competitiveness of indigenous firms in increasingly global value chains, while incumbents heavily use IP as barriers to entry. It also addresses threats to environmental and socio-economic sustainability, and the challenge of acquiring useful foreign technology in an environment where incumbents are reluctant to transfer frontier technology. The Thesis investigates the following questions in particular: (1) How can state-led IP strategy enable latecomers to catch up with advanced players? (2) How can state-led IP strategy support indigenous latecomers' catch-up efforts in increasingly globalized value chains? (3) How can state-led strategy encourage innovations that address social and environmental challenges and foster economic catch-up? and (4) How can the state strategically acquire foreign technology that is useful for catch-up? Given China's size and impact on the rest of the world, how China responds to these challenges is of great scholarly interest.
