Exploiting the Implementation Gap: Policy Divergence and Industrial Upgrading in China's Wind and Solar Sectors

29 Pages Posted: 5 Sep 2015

See all articles by Jonas Nahm

Jonas Nahm

Johns Hopkins School of Advanced International Studies

Date Written: September 2, 2015

Abstract

This article argues that manufacturing policies of Chinese local governments have provided an important corrective to some of the weaknesses inherent in the central government’s indigenous innovation framework, most importantly its inattention to the importance of advanced manufacturing capabilities for innovation. Based on an original dataset of over 100 executive interviews conducted with 43 Chinese wind and solar firms, I identify both central government R&D funding and continued local government support for manufacturing as a critical factors in enabling innovation among China’s renewable energy firms. In particular, this article shows that firms have utilized a combination of both central and local government policies to establish unique engineering capabilities required for innovation in commercialization and scale - up to mass production. The findings suggest that continued local government support for the manufacturing economy has not undermined central government innovation policies, but has (1) broadened the range of resources available to entrepreneurial firms and (2) enabled new options for industrial upgrading that are outside the conceptualization of innovation underlying the central government’s indigenous innovation framework.

Keywords: local government, central government, China, innovation, solar, energy, renewable energy, manufacturing

Suggested Citation

Nahm, Jonas, Exploiting the Implementation Gap: Policy Divergence and Industrial Upgrading in China's Wind and Solar Sectors (September 2, 2015). Watson Institute for International and Public Affairs Research Paper No. 2015-28. Available at SSRN: https://ssrn.com/abstract=2655846 or http://dx.doi.org/10.2139/ssrn.2655846

Jonas Nahm (Contact Author)

Johns Hopkins School of Advanced International Studies ( email )

1740 Massachusetts Avenue, NW
Washington, DC 20036-1984
United States

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