Mapping U.S.-China Technology Decoupling: Policies, Innovation, and Firm Performance

82 Pages Posted: 18 Feb 2021 Last revised: 10 Jul 2022

See all articles by Pengfei Han

Pengfei Han

Peking University, Guanghua School of Management

Wei Jiang

Emory University Goizueta Business School; ECGI; NBER

Danqing Mei

Cheung Kong Graduate School of Business

Date Written: December 2, 2020

Abstract

We develop measures for technology decoupling and dependence between the U.S. and China based on combined patent data. The first two decades of the century witnessed a steady increase in technology integration (or less decoupling), but China’s dependence on the U.S. increased (decreased) during the first (second) decade. Firms covered by China’s Strategic Emerging Industries policies became less decoupled with the U.S., gained cash flows and valuation but saw no improvement in either innovation output/quality or productivity. Post U.S. sanctions, firms in sanctioned sectors and their downstream suffer in performance but also became less decoupled with the U.S. However, firms in the upstream of the sanctioned sectors experienced significant improvements in productivity and produced more innovation of breaking-through and explorative quality.

Keywords: Technology Decoupling, Innovation, R&D, Patent, Firm Performance

JEL Classification: O31, O33, F02, O25

Suggested Citation

Han, Pengfei and Jiang, Wei and Mei, Danqing, Mapping U.S.-China Technology Decoupling: Policies, Innovation, and Firm Performance (December 2, 2020). Columbia Business School Research Paper Forthcoming, Available at SSRN: https://ssrn.com/abstract=3779452 or http://dx.doi.org/10.2139/ssrn.3779452

Pengfei Han (Contact Author)

Peking University, Guanghua School of Management ( email )

No 5 Yiheyuan Road, Haidian District
Beijing 100871
China

HOME PAGE: http://https://sites.google.com/view/pengfeihan/home

Wei Jiang

Emory University Goizueta Business School ( email )

1300 Clifton Rd
Atlanta, GA 30322
United States

ECGI ( email )

c/o the Royal Academies of Belgium
Rue Ducale 1 Hertogsstraat
1000 Brussels
Belgium

NBER ( email )

1050 Massachusetts Avenue
Cambridge, MA 02138
United States

Danqing Mei

Cheung Kong Graduate School of Business ( email )

1017, Oriental Plaza 1
No.1 Dong Chang'an Street
Beijing
China

HOME PAGE: http://danqingmei.com

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