International Technology Transfer And The Upgrading Of China's Industrial Structure

Many scholars such as William Petty, Clark, Simon Kuznets, H.Chenery and W.W.Rostov have paid their attention to the resource allocation among different branches and the contribution to economic growth of its structure changes. As far as the courses of economic growth in some developed countries and newly industrialized countries are concerned, inconsistency of structure was the major or principal contradiction throughout the whole process of industrialization, as was also demonstrated by some scholars. Here the structure mainly refers to the industrial structure, that is to say, the connections of technology and economy and the relations of quantitative proportion among the industries in the national economy. Among these proportional relations, the proportion among branches concerned in industry, that is, the industrial structure in this thesis is the most important one to be emphasized, because the process of economic growth in developing countries is, to a great extent, the ceaseless process to upgrade the industrial structure. Industry in China has been entering the stage of high machining in the heavy industrialization period, a stage to promote investment. In this period, chances for China's further development in industry will mainly come from the following two aspects: one is the upgrading of structure; the other is the all-round renewing of the fixed assets. Processes of the industrialization in Korea, Japan and Taiwan have proved that it is a shortcut to realize the technology advancement if the international technologyl transfer, especially the introduction of technology is made full use of. As for the international experiences and the conditions in china, during the course of the upgrading of industrial structure pushed by international technology transfer, two problems are worth paying close attention to:Firstly, when it comes to the effects of international technology transfer on the host country's industrial structure upgrading, there are big differences in different countries.Secondly, such differences also exist in different branches. Facing the importing technology, some branches advanced quickly, but others did not.Considering all we have mentioned above, this thesis tries to discuss the interactive relationship between the international technology transfer and the upgrading of China's industrial structure systematically. First of all, based on the comparison of international experiences, the mechanism between international technology transfer and upgrading of industrial structure is probed theoretically. Second, by quantitative analysis, the text gives research on the current situations of the relationship between international technology transfer and China's industrial structure upgrading from different angles, such as contrasting of data, analyzing of the industry and technology effect etc. Finally, the policies concerned are introduced.Based on all the analyses, four collusions are reached in this paper: (a) There are two passages for the host country to upgrade its industrial structure through international technology transfer: industry effect and technology effect. How and to what extent these effects brought into function are affected by the technology, management level, manufacturing scale in the host country, (b) Although technology import is correlated to the upgrading of China's industrial structure, it is obviously different among different industries. Furthermore, gray relational grade analysis shows that the effect of FDI is the most obvious one among those different modes of technologytransfer. It is also mentioned that the ability of independent innovation in high-tech industry is weak. (c) Analyzing industry effect of international technology transfer shows that international technology transfer didn't play an important role in the process of China's industrial structure upgrading. Finally, with co-integration test and Granger-causality test, this paper advances that there is causality relationship between the upgrading of China's industrial structure and technology importing, technology exporting and the total amount of technology transfer respectively, but there is no co-integration relationship among them.There are three aspects of innovations in this thesis.First, the way of studies on the upgrading of China's industrial structure is innovated. Based on the viewpoint that technology is the most important factor affecting the upgrading of industrial structure which is mainly affected by the international technology transfer, this paper probes the relationship between international technology transfer and the upgrading of China's industrial structure from the aspects of industry and technology effects.Second, the dimension of studies on the upgrading of China's industrial structure is extended. The research involves time series, industries, regions and international trade. Besides, technology exporting is considered as an explanatory variable in the co-integration test and Granger-causality test.Third, TFP of Chinese industry is estimated by using data of all of China's provinces (except for several years ) during the period of 1986-2003. In spite of some deficiencies, the estimation is accordant to the reality by and large.Through the research, I find although international experiences have proved that it is a shortcut for the host country to upgrade its industrial structure, the effect of the international technology transfer in Chinese industrial structure upgrading is very limited. As a result, the government should make optimal policies based on the full consideration of every related factor.