This model was adopted by other East Asian economies during their development in the second half of the 20th century.
How to achieve a shift from a selective industrial policy paradigm to a proactive policy paradigm has become critical and urgent.
“As frontier technologies, no one knows which technologies have really promising prospects, which will ultimately be pushed through the market through competition,” said Huang Shaoqing, professor of economics at Shanghai Jiaotong University’s Antai College of Economics and Management. may be disclosed.” in a report.
“Therefore, in the early development phase of disruptive technologies, economies of scale are not important and even risky.”
Huang said in a report published in the English-language Asian Review of Political Economy in October 2022 that the government’s selective industrial policy, which has led to China’s economic success in the past, “may even lead to failure and may even lead to failure in the future.” A trap can be formed”. .
“How to achieve a shift from a selective industrial policy paradigm to a functional policy paradigm has become critical and urgent,” he wrote in the report, which was first published in Mandarin in February 2022 by the Journal of Comparative Studies. .
The urgency has become more pronounced for Beijing, which sees innovation and technological progress as key to countering containment efforts by the United States, and becoming an economic and tech superpower by the middle of this century. is also important to his ambitions to become
Peng Peng, executive chairman of the Guangdong Society of Reform, said China needs to plan areas where mature technologies can be applied, including areas affected by US export restrictions, and include more markets. are
“China needs to make significant changes in its industrial policy-making, otherwise, it will never become a global technological and economic leader,” Peng said.
“Decision makers need to listen more to private companies, give them substantial funding for industrial research, and put them on the front lines of disruptive industrial research.”
‘More, better’: PM urges China to focus on application of basic technology
‘More, better’: PM urges China to focus on application of basic technology
But since it is impossible to determine in advance which technology will dominate, a country can only gain an advantage if it has enough small and medium-sized enterprises (SMEs) to offer sufficiently diverse technological paths. Develop, Huang added.
“Only by fostering innovation and entrepreneurship, easing market access, improving the business environment and allowing more SMEs to grow faster can these SMEs be key to innovation-driven economic growth,” he said. can play a role.”
When mapping out a national science and technology plan in 2016, Beijing vowed to improve tracking of revolutionary industrial development to predict the “turning point” of potential transformations of traditional industries.
At the time he added that it would create a timely plan for research into disruptive technologies, such as AI, quantum information, genome editing, unmanned driving, hydrogen power and nanotechnology.
Disruptive technologies can lead to large tech and economic gaps between regions within China, but when there are more participants, the cost of any potential failure is minimized, said Li Yangwei, a technical consultant in the computing sector in Shenzhen. can
He also said that small market players can advise the central government on industrial policies, but amid heavy external pressure and geopolitical complications, Beijing can still allocate resources to large companies or state-owned enterprises.
China’s AI gains will fuel economy as windfall spreads into trillions: McKinsey
China’s AI gains will fuel economy as windfall spreads into trillions: McKinsey
“This requires technocrats to be socially, economically and politically astute, as well as empowered with strong communication skills and centralized decision-making,” Lee said.
China’s basic research accounted for more than 6 percent of its total research and development (R&D) spending over the past four years, down from 16 to 18 percent in the United States and 22 percent in France over the past 10 years.
Basic research from enterprises accounts for only 0.78 percent of China’s total R&D spending, more than 6 percent in developed countries, according to a February report by Science and Technology Daily, a newspaper supported by the Ministry of Science and Technology. .