Will China Eat Our Lunch?

Will China eat our lunch? Short answer: probably yes, but possibly no. China is moving in the right direction, but before betting the house that China will be the world's next technology superpower, it might be wise to hedge a little—just in case.

China's Emerging Technological Edge is an impressive book, authored by two leading experts on the subject. Denis Fred Simon, director of Penn State's Program in U.S.-China Technology, Economic, and Business Relations, has been studying China's transition to capitalism since Mao Zedong's denunciation of Deng Xiaoping and his capitalist roaders. Simon is fluent in Mandarin, and for the past quarter-century has been a matchmaker between foreign investors and Chinese officials. Cong Cao, Simon's long-time collaborator, is senior research associate at the State University of New York's Neil D. Levin Graduate Institute of International Relations and Commerce and the author of China's Scientific Elite, a study of the membership of the Chinese Academy of Sciences.

In 2006, China launched its fifteen-year "Medium- and Long-Term Plan for the Development of Science and Technology" (MLP), officially seeking to "leapfrog development" by investing heavily in research and development, higher education, science parks, and supportive infrastructure.¹ With the MLP—and related policies, including the eleventh and twelfth five-year plans—China has sought to move away "from foreign 'show-how'… to capturing foreign know-how to advance its economy and technological capabilities" (p. 20). This is far easier said than done. The book's generally optimistic prognosis regarding China's high tech future is balanced by its hard-nosed historical analysis, which acknowledges the numerous challenges posed by China's past, particularly the "ten lost years" (1966–76) of the Cultural Revolution that resulted in the virtual elimination of the generation that would comprise China's senior innovators today.

Yet, as the book documents—through a detailed analysis of Chinese government statistics (summarized in more than 70 tables and figures),² interviews, and secondary sources—China is moving mountains to compensate for past sins. Deng reasserted the importance of education, and under Hu Jintao and Wen Jiabao, merit-based higher education has now assumed center stage. China's overarching goal today is to redirect its science and technology policy from merely being "master imitator" to becoming an indigenous innovator (zizhu chuangxin), backed up with substantial public investment aimed at "rejuvenating the nation with science" (kejiao) and "empowering the nation through talent" (rencai qianqquo) (pp. 42, 333).

Yet beyond the promise and the hype,³ as Simon and Cao show, there are many obstacles for China to overcome.

China's Emerging Technological Edge begins by laying out a theoretical foundation for its basic assumption: that investment in human resources in science and technology can pay economic dividends since science and technology talent "can effectively raise the growth rate in leaders as well as followers in economic development by way of technological innovation" (p. 9). Simon and Cao argue that this is especially important for countries such as China that hope to play catch-up by drawing on a "global talent pool" of "trans-border innovation networks" (p. 15). Much of the book is devoted to elaborating on the promises of that emerging talent pool, as well as its many limitations.

In 2006 (the most recent year for which most statistics were available when the book went to press) China turned out some 3.7 million undergraduates, of which half specialized in science, engineering, agriculture, and medicine. China also produced 256,000 graduate degrees, including roughly 36,000 at the doctoral level, more than half of which were in engineering and science (p. 157). Yet despite its expanded investment in higher education and the resulting "marked improvements, especially at key institutions…there is no doubt that the quantitative increase in China's higher education system in recent years has occurred at the expense of necessary quality improvements" (pp...