2009年-世界发展银行全球_Growth_through_Innovation___An_Industrial_Strategy_for_Shanghai_171页_1mb

Summary of Growth through Innovation: An Industrial Strategy for Shanghai

Core Content

This document, Growth through Innovation: An Industrial Strategy for Shanghai, authored by Shahid Yusuf and Kaoru Nabeshima in April 2009, explores the role of manufacturing and innovation in driving economic growth for Shanghai. It emphasizes the importance of a balanced economic structure, the potential of a broad manufacturing base, and the need for systematic innovation to sustain growth in the face of global economic shifts.

Main Viewpoints

• Economic Growth and Innovation: Economic growth is driven by innovation, but few countries have successfully implemented policies to sustain high growth through innovation. China, particularly through its manufacturing sectors, has achieved remarkable growth rates, with Shanghai playing a central role as the urban hub of the Yangtze River Delta.

• Importance of Manufacturing: A broad manufacturing base is essential for sustained growth. Manufacturing industries, especially those producing complex capital goods, electronic equipment, and sophisticated components, are more R&D intensive, generate more innovations, and are more export-oriented. These industries also offer higher productivity and competitiveness due to higher entry barriers.

• Services Sector and Innovation: While the services sector has expanded, monosectoral services-based economies tend to grow more slowly compared to those with a strong manufacturing base. Services can complement manufacturing but are not the primary engine of innovation.

• Urban Development and Innovation: Industrial cities tend to create more middle-class jobs and have a more equal income distribution than service-dominated cities. A world-class tertiary education and research infrastructure, linked to industry, is crucial for resilience and innovation.

• Globalization and Innovation: National market integration and globalization have increased the returns on innovation. A systematic approach to innovation can complement investment and enhance the quality of the urban workforce.

• Challenges and Opportunities: The 2008 financial crisis and global slowdown have created both challenges and opportunities for Shanghai. It needs to reorient its strategy to focus on innovation, particularly in high-tech manufacturing and services, to sustain growth and competitiveness.

Key Information

Economic Context of China

• China's GDP growth rate averaged nearly 10% between 1978 and 2007, with the Yangtze River Delta and Pearl River Delta regions outperforming.
• Manufacturing has been the main driver of China's growth, supported by domestic and foreign demand.
• The Big Push to industrialize since the 1950s laid the foundation for a robust manufacturing sector, including urban industrial labor force.
• Trade and foreign direct investment (FDI) have been crucial for technology and knowledge transfer, enhancing productivity in both foreign and domestic firms.
• Domestic investment in production capacity and physical infrastructure has complemented FDI, accelerating learning and enabling Chinese producers to meet foreign demand.

Shanghai's Economic Structure and Innovation Potential

• Shanghai's economy is currently shifting towards finance and business services, with efforts to expand high-tech manufacturing.
• The city's comparative advantage lies in complex capital goods and high-tech components.
• Shanghai has a growing middle class, a deepening pool of human capital, and increasing R&D investments, all of which support innovation.
• The presence of world-class universities and research institutions is vital for fostering innovation and a knowledge-based economy.
• Shanghai's potential for innovation is supported by its openness to the global economy, FDI in high-tech sectors, and a strong base in manufacturing and services.

Policy Recommendations

• Balanced Economic Structure: Shanghai should maintain a significant share of manufacturing in its GDP, aiming for at least a quarter. This will ensure a broad base for innovation and growth.
• Incentive Policies: Rationalizing and recalibrating incentive policies for industry (land use, input costs, taxes) is necessary to support innovation and avoid over-reliance on services.
• Education and Research: Universities and research institutions should focus on teaching and basic research, with downstream applied research as a secondary objective.
• Strategic Acquisitions: Shanghai should consider acquiring foreign assets, particularly those related to production, research, and intellectual property, during the global economic downturn.
• Re-training and Resource Reallocation: Resources from declining industrial subsectors should be redirected to more promising ones, with retraining efforts to equip the workforce for new opportunities.

Challenges

• The current real estate-driven development model threatens Shanghai's cultural, aesthetic, and environmental attributes, as well as its social capital.
• There is a need to re-evaluate the role of industry and services in the economy and consider rebalancing strategies.
• The global industrial shake-out presents both challenges and opportunities for Shanghai to strengthen its economic base.

Conclusion

Shanghai must reorient its strategy to focus on innovation, particularly in high-tech manufacturing and services, to sustain growth in the coming decades. This requires a balanced economic structure, effective incentive policies, and a strong tertiary education and research infrastructure. The city's openness, accumulated industrial capabilities, and human capital provide a solid foundation for this transition.