“Forced technology transfer” policies: Workings in China and strategic implications

Publication date: Available online 13 June 2018Source: Technological Forecasting and Social ChangeAuthor(s): Dan Prud'homme, Max von Zedtwitz, Joachim Jan Thraen, Martin BaderAbstractThis paper evaluates the ability of “forced technology transfer” (FTT) policies – i.e., policies meant to increase foreign-domestic technology transfer that simultaneously weaken appropriability of foreign innovations – to contribute to technology transfer. We focus on transfer of frontier technology in China's newly designated “strategic emerging industries” (SEIs). Drawing on a survey of foreign firms, extensive interviews with foreign firms, and case studies of Chinese firms, we identify three categories of FTT policies in SEIs: “lose the market”, “no choice”, and “violate the law” policies. Our thematic analysis finds that FTT policies likely exert the most leverage over (i.e., force) frontier technology transfer when accompanied by seven conditions: (1) strong state support for industrial growth, (2) oligopoly competition, (3) other policies closely complementing FTT policies, (4) high technological uncertainty, (5) policy mode of operation offering basic appropriability and tailored to industrial structure, (6) reform avoidance by the state, and (7) stringent policy compliance mechanisms. We develop a Strategy & Risk Matrix to forecast the overall leverage of individual FTT policies. We conclude that Chinese FTT policies may enable domestic acquisition of frontier fo...
Source: Technological Forecasting and Social Change - Category: Science Source Type: research