Globalization and its impact on China's technology innovation system

Purpose – The purpose of this paper is to analyze the general trend of globalization, the role of transnational corporations in the process of globalization and China's integration in the global economy through the linkage of trade and foreign direct investment. China's governmental national technology innovation system and also the progress of R&D system of enterprises of various ownership systems to date are described and analyzed. China's technology innovation system is analyzed both from the macro side and from the micro side within the context of globalization, and the prospect of China's technology innovation system is projected. Design/methodology/approach – Philosophical concept applied to analysis of the theme and structure of this paper is based on the philosophy of Lao‐tzu, yin and yan concepts in Chinese, and dialectic in Western terminology. Concepts of general system theory or system approach are used throughout this paper. Findings – The major finding in this paper is that both necessary and sufficient condition should be created for China to establish an innovative country. Originality/value – This paper is original and analyzes simulation ship between ownership system and technology innovation.