Title: Foreign research and development in China: a sectoral approach

Authors: Yifei Sun

Addresses: Department of Urban and Regional Economy, East China Normal University, Shanghai, China; Department of Geography, California State University, Northridge, 18111 Nordhoff St., Northridge, CA 91330-8249, USA

Abstract: This study systematically examines foreign R&D in China|s manufacturing industries, using the most recent census data published by China|s State Council. It reveals that foreign firms are committing less R&D resource than China|s domestic enterprises. Foreign R&D activities are far more active in high-tech industries than in labour-intensive industries. This study also demonstrates that China|s dynamic domestic market and export, as well as its large pool of well-educated labour are the major drivers for foreign R&D, while the technology drive is not significant yet. Finally, the result shows that foreign firms are less likely to conduct R&D in sectors where they possess strong advantages. Such results suggest that the Chinese governments and domestic firms should focus on building up indigenous innovative capabilities in order to attract more foreign R&D: the majority of foreign firms will invest in R&D when they feel the competition from domestic firms.

Keywords: globalisation; research and development; foreign R&D; multinational corporations; MNCs; comparative advantage; sectoral distribution; manufacturing industry; China; innovation; indigenous capabilities; innovative capabilities.

DOI: 10.1504/IJTM.2010.033809

International Journal of Technology Management, 2010 Vol.51 No.2/3/4, pp.342 - 363

Published online: 06 Apr 2013 *

Full-text access for editors Full-text access for subscribers Purchase this article Comment on this article