Title: The governance structures, the innovation systems and the core competitiveness of Chinese firms

Authors: Chun Liao

Addresses: Shanghai Lixin University of Commerce, 2800 Wenxiang Road, Songjiang District, Shanghai 201620, China

Abstract: This paper compares the Chinese economy with liberal market economies (LMEs, e.g., the USA and the UK) and coordinated market economies (CMEs, e.g., Germany and Japan). It aims to define the innovation system of the Chinese economy. In the Chinese state sector, the firms| governance structure is similar to CMEs, and it also generates a coordination-based innovation system. In the Chinese private sector, the firms| governance structure is similar to that of LMEs, and it also generates a market-oriented innovation system. Because of the clear coordination boundary between the two sectors, the institutional complementarities in each are intact. The dual innovation system has enabled the Chinese economy to compete more successfully than LMEs and CMEs which each only have one type of innovation system. Is the Chinese model unique? Can it be replicated in other countries? Does the USA has the potential to build a dual structure superior to the Chinese-style dual structure?

Keywords: Chinese firms; core competitiveness; innovation systems; firm governance; corporate governance; governance structure; coordinated market economy; CME; liberal market economy; LME; China; private sector; public sector.

DOI: 10.1504/IJIRD.2011.038064

International Journal of Innovation and Regional Development, 2011 Vol.3 No.1, pp.82 - 96

Published online: 29 Nov 2014 *

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