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

79 Pages Posted: 18 Feb 2021 Last revised: 7 Jan 2022

See all articles by Pengfei Han

Pengfei Han

Peking University, Guanghua School of Management

Wei Jiang

Columbia University - Columbia Business School, Finance; 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. Decoupling in a technology field predicts China’s growing dependence on U.S. technology, which, in turn, predicts less decoupling further down the road. Decoupling is associated with more patent outputs in China, but lower firm productivity and valuation. China’s innovation-oriented industrial policies trade off the inherent conflict between indigenous innovation and firm competitiveness.

Keywords: Technology Decoupling, Innovation, R&D, Patent, Industrial Policy

JEL Classification: O31, O33, F02, O25

Suggested Citation

Han, Pengfei and Jiang, Wei and Mei, Danqing, Mapping U.S.-China Technology Decoupling, 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

Columbia University - Columbia Business School, Finance ( email )

3022 Broadway
New York, NY 10027
United States
(212) 854-5553 (Phone)

ECGI ( email )

c/o the Royal Academies of Belgium
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NBER ( email )

1050 Massachusetts Avenue
Cambridge, MA 02138
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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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