From learning to earning: the transition from manufacturing catch-up to competitiveness at the global business frontier, as pursued in China's energy equipment sector

Most studies of industrial policy in Japan, South Korea, Taiwan and China have been concerned with the state’s role in framing industrial policy, and have taken a cross-sectional approach, limited in time. This thesis explores industrial policy longitudinally, as a dynamic, evolving relationship between the state and firms, one in which the positive contribution of the state tends to diminish as capabilities in the wider economy increase. It does so through an examination of the development of firms in China’s electricity-generating equipment industry since 1978, based on more than 70 case study interviews. Three sub-sectors – thermal power equipment, wind turbines, and photovoltaics – are examined in order to track state industrial policy development and the evolution of firm-level capabilities and strategies over four decades. A multi-disciplinary theoretical foundation is constructed from development economics studies and economic and strategic management theory. The findings point to inevitable tension between the early-stage, centralising support for technological learning by a strong developmental state and the more fluid, dynamic and disruptive capabilities that define successful firms’ strategies once basic manufacturing skills are acquired. While the developmental state’s strengths are reflected in the steady, conservative nurturing of manufacturing capabilities, successful firm strategy increasingly requires dynamic capabilities reflected in systems integration, and strategic risk taking in the choice of activities in the business chain and technology sourcing, in turn favouring private ownership. The thesis findings recommend policies that explicitly recognise the need for transitions from state-led development to decentralised, entrepreneurial and market-led growth. It is concluded that strategic management research could contribute significantly to our understanding of economic development if researchers focused attention on political economy transitions in developmental-state-led economies.ESRC funde

What happened to the Miracle Eight? Looking East in the twenty-first century

All developing countries have been "looking East" since the rise of the Asian tigers, especially South Korea and Taiwan. The designation of the Southeast Asian economies as "tiger cubs" implies the question: can would-be tigers become tigers? Against the background of both oriental globalisation and China's effect on the region, this article compares trends in Northeast and Southeast Asia in agriculture, industry and services. State and political institutions are part of the comparison. As the conclusion notes, the new imperative for sustainable and inclusive growth excludes simply retracing the tigers development path: political change, in both national and regional institutions, is needed for the reforms in land, fiscal and industrial policy that will permit Southeast Asia to escape the middle-income trap

China’s contingencies and globalisation

Will China be able to rebalance its economy, heavily tilted towards investment? Will it be able to increase the share of household consumption in GDP? Will it turn steeply growing social inequality around? Will urbanisation contribute to China’s rebalancing or will it add to the imbalances? Will China manage to bring pollution under control? Such variables will determine whether China can move beyond the middle-income trap and also affect its external relations. In addition, China’s rebalancing is a variable in global rebalancing. This article provides an introduction to the special issue