2006–2010

The Role of Small Firms in the Technology Development of China

Reprint No. 2010:31

Author(s): Fredrik Sjöholm and Nannan LundinYear: 2010 Title: The World Economy Volume (No.): 33 (9) Pages: 1117–1139
Online article (restrictions may apply)


Science & Technology (S&T) is high on the Chinese policy agenda and the country aims at becoming an innovation-driven economy. Small firms have been important in technology development in other East Asian countries but the situation in Chinese small firms has been far less explored. We examine how much S&T has been accounted for by small firms and how their S&T intensity differs across industries and ownership groups. We also analyse how various firm characteristics differ over size categories and S&T status. This study is based on newly processed micro-level data provided by the National Bureau of Statistics with information on a large number of S&T indicators for manufacturing firms in China in 2000 and 2004. Our results suggest that the role of small firms in Chinese S&T is similar to that in many other countries. They account for a comparably small share of total S&T and most small firms are not engaged in any S&T. However, those small firms that do engage in S&T tend to be more S&T intensive and have a higher output in terms of patents than larger Chinese S&T firms.
 


Reference:
Sjöholm, Fredrik and Nannan Lundin (2010), "The Role of Small Firms in the Technology Development of China". The World Economy 33(9), 1117–1139.

Fredrik Sjöholm

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The authors of this book, Niklas Elert, Magnus Henrekson and Mikael Stenkula, advise the economies of the European Union to become more entrepreneurial in promoting innovation and economic growth. The authors propose a reform strategy with respect to several aspects to achieve this goal.

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