From knowledge-based catching up to valuation focused development: Emerging strategy shifts in the Chinese solar photovoltaic industry
Deyu Li () and
No 2059, Papers in Evolutionary Economic Geography (PEEG) from Utrecht University, Department of Human Geography and Spatial Planning, Group Economic Geography
Recent research in catching-up and leapfrogging literature has been at pains to explain how latecomer countries, besides a few exceptional cases, could achieve leadership positions in global industries. We propose to extend the potential development strategies by drawing on recent insights at the interface between economic geography and socio-technical transition studies. Whereas the extant catch-up literature has strongly focused on conditions of knowledge development, we claim that processes of â€œvaluationâ€ and in particular the formation of new markets needs to be considered more explicitly. Drawing on recent developments in the Chinese solar photovoltaics industry, we show how companies in the country moved from a knowledge based catch-up strategy, to increasingly leading the innovation frontier of the PV sector. However the most promising leapfrogging opportunity only seems to take shape in the most recent phase, where market deployment and entrepreneurial experimentation increasingly target a transition of the electricity sector towards accommodating a high share of renewables. In a nutshell, the experience of the Chinese solar photovoltaics industry progressed from manufacturing PV cells, to climbing the value chain ladder, and finally towards the construction of entirely new socio-technical systems. We argue that this approach is increasingly necessary as sustainability requirements become more urgent and that other countries may learn in order to move out of the middle- income trap.
Keywords: Catch-up; Leapfrog; Middle-income trap; Socio-technical systems; Knowledge; Unrelated diversification (search for similar items in EconPapers)
Date: 2020-12, Revised 2020-12
New Economics Papers: this item is included in nep-ene, nep-ino and nep-reg
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