By: Johannes Lauer and Ingo Liefner
Article: State‐Led Innovation at the City Level: Policy Measures to Promote New Energy Vehicles in Shenzhen, China
What is the main purpose of your study?
The paper examines the effects of innovation policy and planning in China, taking the case of New Energy Vehicles in the Shenzhen megacity as an example.
It shows how strong state influence can boost the use of New Energy Vehicles
What are the practical, day to day, implications of your study?
Readers in Western countries will learn that the Western approach towards supporting innovation and the use of more environmentally friendly solutions is currently challenged by the Chinese approach. Moreover, even people who oppose the non-market compliant elements of China’s innovation policy will have to acknowledge that this policy is successful in terms of promoting New Energy Vehicles fast and at a large scale.
How does your study relate to other work on the subject?
Our study uses the perspective of economic geography and thus we focus less on technical details or models of innovation policy. Instead we highlight the implementation of innovation policy at the local – in this case urban – scale, the interplay of policy and local business, and the integration of policy and planning tools.
What are two or three interesting findings that come from your study?
Chinese policymakers make use of market-compliant and non market-compliant policy measures in order to foster innovation, and non-market compliant instruments such as prohibitions and binding quotas work effectively.
The different policy and planning tools used to promote innovation in the New Energy Vehicle sector are tailored towards the needs of the local economy.
This innovation policy is highly effective regarding a quick and complete transformation of the large public transport sector from relying on vehicles with internal combustion engines to using Electrical Vehicles.
What might be some of the theoretical implications of this study?
We will have to broaden our view of innovation policy and include diffusion-oriented policy and non market-compliant elements – at least when it comes to understanding what other countries do.
Our conceptual understanding of fundamental evolutionary changes in economic systems, for example regarding the necessary transition towards sustainable transport technologies, should not downplay the importance of state action and policy.
How does your research help us think about Geography?
Our research highlights that geography matters even in the case of technological changes and innovation policy that seem to be unaffected by regional particularities: the successful implementation of very a general political agenda depends on creating a win-win situation for important actors at the local level.
Furthermore, our study shows that cities can act as laboratories that develop their unique responses towards big challenges, and others may later follow their examples.