The Ideal Path to Technological Ascent of Developing Firms in China – Interactions between Institutions, Firm Characteristics and Technological Strategies

Abstract

Abstract: The Ideal Path to Technological Ascent of Developing Firms in China – Interactions between Institutions, Firm Characteristics and Technological Strategies Innovation in China is a topic plagued by misconceptions. The Chinese laissez-faire approach on intellectual property rights protection in the early years of the country’s technological development, has led to the continued misconception of technological abilities in Chinese developing firms. This research takes Whitley’s institutional framework of 1999 and the technology strategies literature as a starting point for further analysis. There are gaps in the literature as to the links between national institutions, firm characteristics, and technological strategic choices of Chinese firms. This doctoral research develops all of the above into a coherent framework. The thesis draws on a paired case study approach of two technologically successful Chinese domestic firms. Each of these two reflects a different ownership model, as well as a different industry and geographical position in China. The study is designed as an abductive research using a qualitative approach. A total of 44 semi-structured interviews were conducted, with both managers and employees of the two case study firms and with external industry and government experts. This wider external perspective on the technology path of developing Chinese firms has been previously missing in the discussion of technology strategies for latecomer firms in large developing economies. The overall aim of this study is to isolate an ideal path of technological ascent of developing firms in China and to gain a deepened understanding of how the national institutions and firm characteristics support it. The findings reveal that the most probable path to technological ascent for Chinese developing firms starts with an imitative technology strategy, maturing into a defensive one as the firm progresses on the path. This confirms previous studies on the technological development of Chinese firms. Further, the study finds that external sufficient conditions are created by the national institutions, while necessary internal conditions are rooted within firm characteristics. To understand the diversity across China, it was necessary to analyse the nature of institutionfirm interactions within the context of the newly developed four dimensions: size, ownership, industry, and location. This revealed that there are great differences in a given firm’s range of choices for their technological strategy and resulting probability for technological ascent, depending on their position in the four-dimensional matrix.

Date of Award	1 Aug 2018
Original language	English
Awarding Institution	The University of Manchester
Supervisor	Laszlo Czaban (Supervisor) & Jiajia Liu (Supervisor)