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Incentives for Innovation in China

Building an Innovative Economy

By Xuedong Ding, Jun Li

Routledge – 2015 – 240 pages

Series: Routledge Contemporary China Series

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    February 16th 2015
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There is concern in China that the strategy which has delivered massive economic growth is unsustainable in the long run, that China’s economy is too dependent on low value added manufacturing and not enough based on high value technological innovation. This book assesses the policies implemented in recent years to address this, policies which include increasing the pool of human capital, especially by training very large numbers of graduate engineers, investing massively in improved infrastructure such as institutions of higher education, telecommunications and transport, and providing financial incentives – both direct government funding for private sector innovation activities and fiscal incentives which encourage innovation by reducing the tax burden on innovators. The book examines the impact of these policies, providing detailed studies of firms’ innovation activities both in particular sectors and in particular regions. Throughout, the book discusses how effective China’s innovation policies are and how innovation in China is likely to develop in future.


'China’s economy is transforming. Some aspects of that transformation, such as the rise of the Chinese consumer, are well known. But how many of us understand how China is building an innovation economy? This book plugs an important gap in our knowledge. And, importantly, it is co-authored by a man at the heart of China’s economic policy making, Ding Xuedong, Chairman of China’s sovereign wealth fund.' – Lord James Sassoon, Chairman of China British Business Council (CBBC), UK

'This book gives a comprehensive and insightful account of Chinese theory, experiments and practices of building an innovative country and is an important piece of work that will help the outside world understand the independent innovation policies in China. From my point of view, by improving the innovative capabilities of the whole society, China aims to adjust economic structure, transform development pattern, and build an innovation-based nation. In so doing, China's exploration, practices and experiences have facilitated opening up and cooperation, and hopefully our endeavor can contribute to the sustainable development of the world.' – Professor WAN Gang is Vice Chairman of the 11th Chinese People's Political Consultative Conference (CPPCC), Chairman of China Zhi Gong Party, and Minister of Science and Technology

'China's economic growth has been impressive and innovation will be one of the key drivers for its future development-China has created an enabling environment for growth by encouraging public and private sector enterprises to improve competitiveness, quality and productivity by using world class technology, research and development, global standards and best practices. The authors Chairman Ding and Dr. Jun Li have effectively covered China's pursuit of a National Innovation agenda, China's current and planned innovation incentive structure and a road map for the future. China's peaceful rise will be strengthened by strong and equitable economic growth which will be reinforced with strong structural reforms, promoting science and technology and continuous innovation. The book highlights China's policies to promote innovation and is relevant for all emerging economies.' – Shaukat Azia, Prime Minister of Pakistan (2004-2007)

'Ding Xuedong and Jun Li’s book is a refreshing comprehensive but also a deep and clear analysis of the innovation process in China. For the first time the theoretical background and the real achievements of the innovation process are analyzed both at the national, regional and sectorial level. It is an excellent instrument in order to move brain and action. A must for scholars and policy makers. Not only in China but at a global level.' – Professor Romano Prodi, Prime Minister of Italy (1996-1998 & 2006-2008), Tenth President of the European Commission (1999-2004)

'An essential text for anyone interested in innovation and China. The authors – an academic and experienced government policy maker – have delivered insights that go beyond mere statistics. The range of sources, examples of policy impact and critical conclusions are impressive. In short, the best institutional perspective on innovation available.' – Professor David Brown, Director of Lancaster China Management Centre, Lancaster University, UK


Preface 1. Aspire to Innovate: Building an Innovative Economy 2. China’s National Innovation System 3. Fiscal Incentives for Innovation 4. Financial Policies for Innovation 5. The Public Venture Capital in China 6. Incentive for Sectoral Innovation: The Energy Sector 7. Incentives for Regional Innovation: The Yangtze River Delta 8. Performance of National Innovation System 9. Incentive for Innovation: Chinese Experiences

Author Bio

Xuedong Ding is Chairman and CEO of China Investment Corporation (CIC), Beijing, China

Jun Li is a Senior Lecturer at Essex Business School, University of Essex, UK, and a Visiting Professor at Business School of Jianghan University, Wuhan, China

Name: Incentives for Innovation in China: Building an Innovative Economy (Hardback)Routledge 
Description: By Xuedong Ding, Jun Li. There is concern in China that the strategy which has delivered massive economic growth is unsustainable in the long run, that China’s economy is too dependent on low value added manufacturing and not enough based on high value technological...
Categories: Chinese Economics, International Economics, Chinese Politics, Chinese Studies, Chinese Business, Chinese Politics