Chinese Economics Thread

[Hendrik_2000]

So much for the myth China can't invent or China need some one to teach them how to do technology. Another variant China will get old before she get rich. Or stuck in the middle income like Latin . As I said before education and education that is the mantra. And the Diaspora is the unsung hero of Chinese reform

China Innovation Power: Far Out-Ranks U.S. And Japan In New Patent Applications

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Contributor

I write about innovation and venture trends in global hotspots.


This past week, I heard Chen Xu, CEO of the Bank of China, discuss how important innovation is to drive continued growth of the Chinese economy while state owned enterprises diminish in power. He mentioned the disruptive breakthroughs that are coming from such leading tech leaders as social communications titan Tencent and drone maker DJI. He noted that innovation is being driven returnees with degrees from top U.S. business and tech degrees. And he talked about how tech hubs Shenzhen, Guangzhou and Beijing are vying with one another to attract more up and comers to base headquarters in their turf.

In case you missed it, China far outstripped the U.S. in the number of new patent applications, according to the 2015 edition of the World Intellectual Property Indicators. This is the third year in a row that China’s increase has outranked other leading nations.

China recorded 928,177 patent fillings in 2014, trailed by the U.S. at 578,802, Japan at 325, 989 and Korea at 210,292. Most of the growth in patent filings was due to China’s surge of 12.5% compared with a 1.3% increase for the U.S. and Japan at a decline of .7%. Interestingly, Iran topped growth increases globally with a 18.5% gain in patent applications.

Moreover, China has climbed steadily over the past seven years to rank third worldwide for the number of patents in force, at 1.2 million. The U.S. leads with the number of patents at 2.5 million and Japan at 1.9 million.

Turning to specific technology advancements, Japan leads innovation in robotics, with auto makers Toyota, Nissan, Honda leading. The U.S. comes out on top for the most number of new patent applications in nanotechnology and 3D printing. Looking at a longer time span from 2005, China accounted for more than one-quarter of patents globally in 3D printing and robotics, the highest share among all countries.

A look at the Asian region as a whole underscores a shift in innovation to the East. Asia’s percentage of patent applications has grown from 49 percent in 2004 to 60 percent in 2014. Meanwhile, North America has slid from 25.1 percent to 22.9%.

 

[Blackstone]

So much for the myth China can't invent or China need some one to teach them how to do technology. Another variant China will get old before she get rich. Or stuck in the middle income like Latin . As I said before education and education that is the mantra. And the Diaspora is the unsung hero of Chinese reform

China Innovation Power: Far Out-Ranks U.S. And Japan In New Patent Applications

China is clearly making important progress, but there's quantity of innovations and then there's quality of innovations. US, Taiwan, Japan, South Korea, and the bigger Western countries have both, and China wouldn't be at the same level until its quality is first-rate.

 

[antiterror13]

well, you have to start somewhere. Some of Chinese innovations already the best in the world. But you are right, quality wise in general, China still a long way to go to reach the US and a few other western countries quality level (see ... I make it clear to differentiated the US and other western countries)

 

[Equation]

All thanks to Chinese brains and other foreigners that can make the US "quality" innovations moving.

 

[Yvrch]

Just reading the headlines would make one immediately aware of the fact that nature and characteristics of China's economy is rapidly changing; innovation, service, consumption, digital economy, etc. All the more important and notable is her GDP print in recent years has kept shrinking despite these improvement in quality and composition of GNP. Her growth and volatility have no doubt shown enormous impact and influence on all major movers shakers of the world. GDP number is emotionally charged, politically explosive arithmetic that has lost all its meanings and people just assume it is a number that tells all.

Here an analogy of Bible is quite relevant. Besides what the book says, it is also interesting to know the history of the book itself; how the book came this far through time.

Richard Stone said it is an empirical construct, not a primary fact. That one sentence would capture the essence of his creation which came to fruition in 1941 in the thick of British war efforts which required England's careful use of limited resources and tracking these uses.
Across the pond, Simon Kuznets and Milton Gilberts were locking horns over concepts of individual welfare and FDR's armament buildup that didn't quite fit into existing theories of national income. Milton Gilberts won it in 1942 right after America plunged headlong into WWII. Hardnosed realism owned the day.

For sure it had been hundreds of years since the days of Sir William Petty. There had been many notable names who built upon and expended what were path breaking concepts in their own time, however imprecise that are by today's standard.

The construct of GDP was born out of necessity to fight wars. It is a statistical process of careful classifications, standards and yes estimates.

As it has its roots in Industrial Revolution where economies were rapidly expending, it is highly biased towards manufacturing. What they were missing in the 1940's and 1950's when the basic components of modern economy were forming - GDP , Keynes's General Theory, econometrics , thereby the trinity of endless growth theories - is the Silicon Valley, globalization, digital economy and ever falling price for even better technologies. These factors, or primary facts according to Richard Stone, are not reflected fast enough in what is supposed to be empirical construct - GDP. There is a growing discomfort in the usefulness of headline GDP prints where a slight change in the statistical methods used would have far significant changes in the GDP readings. Examples are plenty.

That's not to say to throw away the whole process, as it was born out of realpolitik, it has real world uses that guide the decisions in the corridors of power. But we all have to remember it is a made up construct, just like fiat money , laws and culture, we have to take it in a proper context.

Double entry accounting is not a natural phenomenon, but a mathematical attempt to afford some claim to being scientific and rational for this rather dynamic concept which tries to encapsulate the ever changing evolving fluid human existence.

 

[antiterror13]

I have to admit, it is not easy read and I don't really understand the main focus

 

[Franklin]

So much for the myth China can't invent or China need some one to teach them how to do technology. Another variant China will get old before she get rich. Or stuck in the middle income like Latin . As I said before education and education that is the mantra. And the Diaspora is the unsung hero of Chinese reform

China Innovation Power: Far Out-Ranks U.S. And Japan In New Patent Applications

Please, Log in or Register to view URLs content!

,

Contributor

I write about innovation and venture trends in global hotspots.


This past week, I heard Chen Xu, CEO of the Bank of China, discuss how important innovation is to drive continued growth of the Chinese economy while state owned enterprises diminish in power. He mentioned the disruptive breakthroughs that are coming from such leading tech leaders as social communications titan Tencent and drone maker DJI. He noted that innovation is being driven returnees with degrees from top U.S. business and tech degrees. And he talked about how tech hubs Shenzhen, Guangzhou and Beijing are vying with one another to attract more up and comers to base headquarters in their turf.

In case you missed it, China far outstripped the U.S. in the number of new patent applications, according to the 2015 edition of the World Intellectual Property Indicators. This is the third year in a row that China’s increase has outranked other leading nations.

China recorded 928,177 patent fillings in 2014, trailed by the U.S. at 578,802, Japan at 325, 989 and Korea at 210,292. Most of the growth in patent filings was due to China’s surge of 12.5% compared with a 1.3% increase for the U.S. and Japan at a decline of .7%. Interestingly, Iran topped growth increases globally with a 18.5% gain in patent applications.

Moreover, China has climbed steadily over the past seven years to rank third worldwide for the number of patents in force, at 1.2 million. The U.S. leads with the number of patents at 2.5 million and Japan at 1.9 million.

Turning to specific technology advancements, Japan leads innovation in robotics, with auto makers Toyota, Nissan, Honda leading. The U.S. comes out on top for the most number of new patent applications in nanotechnology and 3D printing. Looking at a longer time span from 2005, China accounted for more than one-quarter of patents globally in 3D printing and robotics, the highest share among all countries.

A look at the Asian region as a whole underscores a shift in innovation to the East. Asia’s percentage of patent applications has grown from 49 percent in 2004 to 60 percent in 2014. Meanwhile, North America has slid from 25.1 percent to 22.9%.

I always have been skeptical about all those patent fillings coming from China. But the most important part is the number of patents enforced. And its good to see that China is doing well there.

Innovation comes in 4 forms you have consumer, production, engineering and scientific innovation. China is doing quite well when it comes to consumer and production innovation and is starting to make inroads in to engineering. Its on the scientific side of things where China is found to be lacking. But that is because that's the highest level of innovation and you need deep knowledge to do that. Knowledge that China at this point doesn't fully possess yet.

 

[Hendrik_2000]

I always have been skeptical about all those patent fillings coming from China. But the most important part is the number of patents enforced. And its good to see that China is doing well there.

Innovation comes in 4 forms you have consumer, production, engineering and scientific innovation. China is doing quite well when it comes to consumer and production innovation and is starting to make inroads in to engineering. Its on the scientific side of things where China is found to be lacking. But that is because that's the highest level of innovation and you need deep knowledge to do that. Knowledge that China at this point doesn't fully possess yet.

Comparing research in the west vs China is like comparing apple and orange. People sometime forget that China was in turmoil for 20 years Japanese invasion, civil war than cultural revolution where higher education was interrupted for 30 years . Whatever advances made after liberation was lost and China lost a whole generation of scientist. High school exam doesn't resume until 1977 and University didn't open it's door until early 80's so They have basically start all over again from nothing.

While in the west they have uninterrupted research effort for 100 of years

Another thing is money US and the west spent considerable larger amount of money in their civilian research to the tune of 2.5 to 3.5% of GDP. Add to that the R&D of military and defense it can easily reached 5% of GDP or As it stand now China spent considerably less only recently is it reach 2% and there are plan to increase it to 2.5%.
Not to mention the lack of basic infrastructure to do research. Only now China built facilities for basic research. CERN and ITER cost so much money no single country can afford it . They have to pool their money

So of course the west is more advance in basic research. Considering all those handicap they did extremely well in such a short period of time and the most encouraging part is that now the private sector is the dominant sector in R&D realizing that they have to invent to survive and copying is dead end route. Couple with tremendous entrepreneur spirit and respect for education I see bright future in Chinese technology

 

[Yvrch]

I have to admit, it is not easy read and I don't really understand the main focus

Probably, about 2 weeks later, you might be able to connect the dots.
Wait for the news on April 14 and 19 to be exact.

 

[vincent]

My wife just came back from China. Payment systems there are far more advance that what's available here. You can pay street vendors through WeChat by scanning a QR code. QR payment codes are everywhere.