Elisa Barbieri

Made-in-China: high-tech national champions of business excellence

Purpose – The purpose of this paper is to analyse the development strategies of two Chinese global players in the high‐tech sectors.Design/methodology/approach – The paper adopts a case‐study approach on Huawei Technology Co. Ltd (Huawei) and Jing‐Hua Optical and Electronics Co. Ltd (JOC).Findings – While Huaweis first strategic decision was that of becoming a leader on the domestic market, the key choice for JOC was that of acquiring a European firm. However common features emerge: persistent investment in R&D, strategic collaboration with universities and presence of government supporting policies, even though the case studies suggest the existence of thresholds for firms to access the benefits of government policy.Research limitations/implications – The results pave the way for more general discussions on the emergence of champions of excellence in China. They reinforce the idea that Chinese industrial development is built on non‐conventional catching‐up processes at the country, local and firm level....

R&D policy evaluation: the effects of R&D subsidies in Italy

In a context of scarce resources, exacerbated by the economic crisis, financing investment and structural changes in slowly growing economies, such as Italy, is very challenging. It becomes fundamental to engage in evaluation exercises in order to understand what policies are working and for whom. The paper offers an evaluation exercise on the major instruments used to promote R&D and innovation activities of Italian firms. We concentrate in particular on the incentives provided by Law 46/82 (and revisions) and we look at the effects they have on firms expenditures on R&D and on new employment generation. Unlike previous studies, we consider the effects of such incentives also when other similar policies are at work. We also look at the effects for different subgroups of firms. Results suggest that a rethinking of the system of incentives would be appropriate to limit an inefficient overlapping of instruments. They also highlight that the additionality of R&D investment is verified for some categories of firms. Starting from these results, further and continuous research is needed on this subject, in order to build a robust set of evidence to inform the policy making process.

The evaluation of policies for knowledge transfer: some emerging issues

Governments in western countries are seeing Universities as the key actor to promote a transition to a knowledge-based economy that can help the future competitiveness challenges posed by new entrants in the global market. In this context, specific industrial policies are designed to promote a transfer of technology, and a more general transfer of knowledge from universities to firms, in order to favour innovation, that is the economic exploitation and commercialisation of new products and processes generated by inventions within universities. Although the use of these policies is rapidly expanding, the same cannot be said of the evaluation efforts made to understand the effects of the reforms promoted in western economies. This paper offers a contribution to the existing literature and highlights some key open issues on which future research can build in order to improve the knowledge on the effectiveness of reforms we are witnessing, in particular in the U.S. and in Europe.

Guangdong Province, China: firms, cities and sectors of excellence

Purpose – The purpose of this paper is to provide an updated picture of the emergence of specific firms, cities and sectors of excellence in one of the best performing industrial areas of China: Guangdong Province.Design/methodology/approach – The paper focuses on a single province‐case study and zooms on its leading territories, sectors, firms and policies. Geographical areas, industrial sectors and firms are defined “of excellence” according to their contribution to the overall industrial performance of the province.Findings – High industrial performances are not equally spread in the province. They involve specific sectors (such as electronics), areas (Pearl River Delta) and even specific firms (particularly Chinese‐owned and SOEs). This picture is in line with the recent policy objectives (support to ODI by national companies, indigenous innovation, national and local champions, restructuring of SOEs) and with the history of preferential industrial development policies.Research limitations/implication...

Special Economic Zones and Cluster Dynamics: China

Clusters of specialized firms are now coming to be recognized as an important level of integration and organization in successful industrial economies. Such clusters, among which are industrial districts, were prominent in nineteenth-century European industrial development (in Italy, Britain, and Germany) and in the United States, and then in Japan, and are now viewed as being central to successful industrial development in the twenty-first century in China and India, where they are specifically promoted through ad hoc policies. In designating special economic areas, such as geographic clusters of firms or special economic zones (SEZs), national and regional authorities aim to attract and stimulate economic activities in specific, bounded areas of the country, where business-friendly rules can apply. After presenting the rationale and main features of SEZs, the article illustrates the experience of China, and in particular Guangdong Province and the Pearl River Delta, where SEZs based on Shenzhen and other urban centers have played a prominent role. A careful analysis of the policies adopted in the country to kick off and manage the transition process highlights a central concern of the government to manage the spatial patterns of industrial development. Specific tools have been developed in order to shape the geography of industry: cluster promotion has been pursued while also managing a number of SEZs with the specific aim to concentrate the early stages of industrial development in confined areas, learning from the prior experience of industrial districts in Europe, the United States, and Japan. In China, and especially in Guangdong, the development of SEZs and the promotion of clusters of firms have gone hand in hand to achieve long-term industrial development objectives.

Incentives to Research&Development in Italy: An Analysis of the Effects of Law 46/82

The current economic crisis has put government intervention and policy evaluation at the centre of the debate on industrial development policy. Government efforts to stimulate a structural change of Italian industries are needed and in this context it becomes fundamental to engage in evaluation exercises in order to understand what policies are working. The paper offers an evaluation exercise on the major instruments used to promote R&D and innovation activities of Italian firms. We concentrate in particular on Law 46/82 and we look at the effects of the incentives it provides on firms expenditures on R&D and on new employment generation. We also consider the effects of such incentives when other similar laws are at work. Results suggest that a rethinking of the system of incentives might be needed to limit an inefficient overlapping of instruments.

Restructuring the Production of Medicines: An Investigation on the Pharmaceutical Sector in China and the Role of Mergers and Acquisitions

In places like China, an ageing population coupled with changes in living standards and increases in disposable income, imply a shift of the demand for health-related goods and services which is likely to affect the whole organization of the industries that supply such goods and services at the global level. One of the industries most likely to be affected is the pharmaceutical sector. In the early 2000s China was already the second largest global producer of pharmaceutical ingredients. The pharmaceutical sector has become one of the most important industries promoted by the Chinese government and Five-Year Plan of China’s Strategic Emerging Sectors, mergers and acquisition (M&A) activity has been the key strategy to restructure the sector and increase its competitiveness. This paper firstly provides an updated picture of the evolution of M&As in the pharmaceutical sector, compared to other sectors, in China in the period 2005–2013. Secondly, we develop a composite indicator to measure the industrial performance of all Chinese industrial sectors over time, which allows us to assess the performance of the pharmaceutical industry compared to that of other sectors of the Chinese economy. Finally, we develop and estimate an empirical model that tests the relationship between the number of M&A in a sector and its performance, with a particular focus on the pharmaceutical case. The results offer some initial evidence of positive effects from the process of restructuring of the pharmaceutical sector in China.

Selective Industrial Policy and Strategic Sectors. The Choices of Beijing

The debate over the inefficiencies and risks of selective industrial policies has influenced the agenda of policy actions in many ways and for a long time. It surely has influenced the way governments describe their policy interventions. «Horizontal policies», «enabling technologies», «getting the fundamentals right» are all terms inherited from that debate. Yet, in many cases such debate goes hand in hand with policy practices, around the world, that are de facto selective. Chinas experience of industrial growth is noteworthy for several reasons, not least because it has made a massive use of selective industrial policies. The industrial development guidelines set by the Five-Year Plans are extensively based on the choice of «strategic» or «pillar » industries to be promoted and supported. What remains unclear is the way in which such industries are identified among many. With this paper we want to stimulate a debate on how to improve the government choice of strategic sectors. In the specific case of China, we argue that improving the transparency and the rigour of such choice can be crucial for the national and the local governments to maintain an authoritative position in the transition to a «market» economy. Firstly, we reconstruct the evolution of the strategic sectors identified by the Five Year Plans from the midnineties to the present, highlighting the industries on which the government focused the interest. Secondly, we build a composite indicator to rank the different industries according to their strategic importance in the Chinese economy. We compare the ranking to the list of strategic industries described in the Twelfth Five Year Plan. We find that, by and large, our ranking coincides with the list of strategic sectors of the Chinese government.

Evolutionary Paths in Supporting Firms in China. An Analysis of Leading Firms and Insights on Industrial Policy

The paper studies the evolution in the support to firms in China. Using a tailored imitativelearning approach, Chinese policy makers have supported national champions (similarlyto the Japanese experience), while also favouring the emergence of sectoral agglomerations ofsmes (as in the case of clusters and industrial districts). By means of an analysis of the leadingindustrial firms of Guangdong province, where the process of opening of Chinese economystarted, the paper highlights specific (more or less explicit) choices of industrial policy thathave driven the industrial development of the nation.