China’s 40-year Road to Innovation

Purpose The purpose of this paper is to review the evolution of policies and practice of innovation in China for the past 40 years. Design/methodology/approach This is a review paper. It adopts a different multi-dimensional, qualitative methodology to examine China’s trajectory of innovation from the economic reform since 1978, highlighting ‘China’ experiences in the developing innovation-driven economy, also pointing the challenges that China faces in this transition process and future prospects. The analysis of China’s innovation performance was based mostly on secondary data from sources and institutions that use statistical data to build country rankings, such as Global Innovation Index (GII) and Global Competitiveness Index (GCI). Findings It is found that the institutional foundations of national innovation system in China are already being laid, and so far, China has made extraordinary progress regarding innovation performance from country to region and from business to individual. However, some critical challenges in its innovation-driven development still need urgent attention and effective efforts to reinforce them. Originality/value This paper aims to fill the gap in the literature by providing an overview of the evolution of the policies and practices of innovation development in China since the 1978 economic reforms, and explores the Chinese experiences in transforming into an innovation-driven economy.