Innovation strategy and performance during economic transition: Evidences in Beijing, China

This paper evaluates the relevance of innovation strategy to various categories of Chinese firms and investigates its relationship with innovation performance during the economic transition of the 1990s. Data from 1244 Chinese firms in Beijing are used to ascertain the relative importance of different innovation objectives, along with the innovation strategies adopted by manufacturing firms. Results show that innovation activities were confined to the domestic sphere and mainly directed at quality improvement. Chinese manufacturing firms which obtained support from the government through the high-tech firm accreditation system generally perform better. They had already started moving away from a reliance on imported technology and equipment, and using indigenous R&D efforts to innovate for the coming market economy.