Developmental state and innovation: nanotechnology in China

In this article we examine the role of the Chinese government in fostering advances in nanotechnology, while looking at the promises and pitfalls of state‐led development in the world's fastest‐growing major economy. China, like many countries involved in catch‐up development, is convinced that manufacturing prowess alone is not enough to make it a leading economic power in the twenty‐first century. Our concern here is how, within the context of nanotechnology, China's approach to national development reflects the debate on innovation. Many countries, including the United States, see government spending on nanotechnology as essential to creating world leadership in this emerging field. The USA, for example, expects to spend $1.8 billion in 2011 on its National Nanotechnology Initiative – primarily to foster basic research and development. Unlike the USA, government sources largely fund nanotechnology in China, for its economy is in transition from state‐owned to privately‐owned enterprises and still suffers from a lack of private investment capital. Moreover, in China, such funding extends more broadly across the value chain than in the United States, from fundamental research to commercialization. Through field research and extensive interviews, in this article we document and evaluate the effectiveness of China's state‐led efforts to become a global nanotech leader.