中國企業育成中心(科技企业孵化器)之研究 - 政大學術集成

全文

(1)國⽴立政治⼤大學亞太研究英語碩⼠士學位學程 International Master's Program in Asia Pacific Studies College of Social Sciences National Chengchi University. 碩⼠士論⽂文 Master’s Thesis 治. 立. 政. 大. ‧ 國. 學. 中國企業育成中⼼心(科技企业孵化器)之研究. ‧. Technology Business Incubators in China. n. engchi. er. io. Ch. Su, Ling-Yu. sit. y. Nat. al. 蘇羚毓. i n U. v. 指導教授：姜家雄博⼠士 Advisor: Chiang, Chia-Hsiung, Ph. D.. 中華民國 106 年 7 ⽉月 July 2017 I .

(2) ABSTRACT Innovation and entrepreneurship are regarded as an economic tool to promote independent innovation and economic growth in the sluggish economy. In China, the Technology-based Business Incubators (BIs) focusing on promoting technology-based small and medium-sized enterprises (SMEs) and regional development are viewed as the innovative carriers under the initiative of “Mass Entrepreneurship and Innovation”. This study attempts to systematically analyze the role of BIs in Chinese economic growth and the role of government play in advancing BIs development through the important literatures and secondary resources, complemented in part with incubation case studies in Wuhan and Shenzhen, and the implementing results of the financial policies and legal reforms. Findings demonstrate that Chinese BIs serves as the catalyst to accelerate S&T development and to provide matching service at technopreneurial functions on the resources of knowledge (high-tech research to patents), communities (high-tech SMEs, universities, and relevant entities), and networks (accessing government, investors, and entrepreneurs), which have promoted regional economic transformation. Meanwhile, the role of Chinese government plays a policy guidance in incubation system, while promoting the transformation of government functions. To conclude this research, BIs are part of the Chinese innovation systems. There is an inseparable relationship between Chinese BIs and the government. The greater the government involvement in BIs support, the greater the interdependence of the BIs and the government. BIs are one of the important factors to facilitate the self-reform of the government, remodeling relations among the government, market and society. In the background of China's “new normal”, the findings of this study provides a future direction to investigate the innovation capability of BIs sustainability. To understand the overall picture of China's rapid growth economic development, the innovation capability of BIs sustainability is worthy of further investigation and discussion.. 立. 政治大. ‧. ‧ 國. 學. n. er. io. sit. y. Nat. al. Ch. engchi. i n U. v. Key words: Technology business incubators, technology innovation, entrepreneurship, business incubators financial support, business incubators policy support, role of business incubators, role of government in incubators support, Shenzhen innovation, Wuhan East Lake High-tech Development Zone, Chinese economic transformation. I .

(3) 摘. 要. 創新及創業被認為是現代社會緩解經濟遲緩、︑､促進經濟增⾧長、︑､引領⾃自主創新的⼀一帖良藥。︒｡在中國，以培育科技型中⼩小型企業、︑､促進區域經濟發展的「科技企業孵化器」被視為中國落實「⼤大眾創業，萬眾創新」政策的載體，更被⽤用以促進中國經濟穩定增⾧長的重要舉措之⼀一。︒｡本研究試圖透過相關重要⽂文獻及次級數據，輔以極具代表性的深圳及武漢地區之孵化器為案例，再透過財務政策及法律改⾰革等相關數據，系統性地分析科技企業孵化器在中國經濟成⾧長下所扮演的⾓角⾊色，以及中國政府在引領並推進此⼀一創新載體所發揮之作⽤用。︒｡研究發現，中國科技企業孵化器可做為促進科技創新與經濟增⾧長之媒介－催化劑，為新創企業匹配早期所. 政治大. 需之資源(包含知識移轉、︑､社區實體及關係網絡對接)，直接與間接地促進區域經. 立. 濟轉型升級，證明了科技企業孵化器有能⼒力促進國家創新能⼒力與經濟可持續增⾧長，. ‧ 國. 學. 並成為推進中國經濟轉型的助⼒力之⼀一。︒｡同時，中國政府扮演主導推進孵化體系發展的政策指導者，通過⼀一系列資源及政策⽀支持，指導科技企業孵化器的發展路徑. ‧. 及進程，同時促進了政府職能的轉變。︒｡總結本研究結果，科技企業孵化器是中國創新體系的⼀一部分，其與政府之間存在著不可分割的關係。︒｡政府對科技企業孵化. Nat. sit. y. 器的⽀支持參與度越⼤大，科技企業孵化器與政府的相互依賴度就越⼤大。︒｡作為中國創. er. io. 新和科技發展政策框架的重要組成部分，科技企業孵化器正推動經濟可持續增⾧長並建⽴立⼀一個技術創業的⽣生態系統，同時重塑政府、︑､市場、︑､社會之間的關係。︒｡本研. al. n. v i n Ch 究結果可提供未來相關研究探討科技企業孵化器的可持續發展之創新能⼒力。︒｡在中 engchi U 國經濟新常態下，探就可持續性的科技企業孵化器有助於全⾯面了解中國科技與經濟成⾧長之關係，相關研究值得後續進⼀一步分析實證。︒｡. 關鍵字: 育成中⼼心、︑､科技企業孵化器、︑､科技創新、︑､創業、︑､孵化器的⾓角⾊色、︑､政府在孵化器的⾓角⾊色、︑､深圳創新、︑､武漢東湖⾼高新區、︑､中國經濟轉型. II.

(4) ACKNOWLEDGEMENT. －本論文獻給我摯愛的家人－ This thesis is dedicated to my family, for their endless love, support and encouragement.. I never thought I could wear the purple gown of IMAS at NCCU's commencement. Being a student again is so meaningful to me, and words can't describe how thankful I am to this journey! I would like to express my gratitude to all those who have made this thesis possible. My deepest gratitude goes first and foremost to my adviser, professor Chia-Hsiung Chiang for guiding and. 政治大 this thesis could not have reached its present form. I never thought I would have the patience 立 or so-called intelligence to write a nearly hundred pages thesis.. encouraging me over the year. Without his enlightening instruction and strong attention to detail,. ‧ 國. 學. I am also deeply indebted to my thesis committee members for all of their guidance through. ‧. this process, Dr. Eldon Y. Li and Dr. Wen-Chieh Wu. Their insightful comments, suggestion and feedback have been absolutely invaluable.. y. Nat. sit. Sincere gratitude should be given to my dear friends and classmates in IMAS for their. al. er. io. understanding and encouragement during the tough times in the pursuit of academic. n. achievements. In particular, I would like to thank Li-Wen and James Morris, for keeping me. Ch. i n U. v. company and offering valuable suggestions for improvement while I struggled with writing.. engchi. Special appreciation is also extended to my companion Eason who experienced all of the ups and downs of my research. Last but most importantly, I would express a deep sense of gratitude to my beloved family from the bottom of my heart, for being my backbone throughout my study and giving me strength to chase my dreams.. “On your journey through life, make sure your biography has at least one extraordinary chapter.” – Anonymous. . III.

(5) TABLE OF CONTENTS CHAPTER I INTRODUCTION. 1. 1.1 RESEARCH MOTIVATION AND BACKGROUND OF THE STUDY. 1. 1.2 RESEARCH PURPOSES AND RESEARCH QUESTIONS. 9. 1.3 RESEARCH METHODOLOGY. 10. 1.4 SCOPE AND LIMITATION OF THE RESEARCH. 11. 1.5 ORGANIZATION OF THESIS. 12. CHAPTER II LITERATURE REVIEW. 14. 2.1 WHAT ARE BUSINESS INCUBATORS?. 14. 2.2 THE ROLE OF BUSINESS INCUBATORS IN ECONOMIC DEVELOPMENT. 17. 2.3 THE ROLE OF GOVERNMENT IN USINESS NCUBATORS. 23. CHAPTER III THE ROLE OF BUSINESS INCUBATORS IN CHINA. 立. 29. 3.1 OVERVIEW OF CHINESE BUSINESS INCUBATORS. 29. 3.2 BUSINESS INCUBATORS AND SERVICE SECTOR. 學. ‧ 國. B政 I治大. ‧. 3.3 REVIEW TWO CASES ON THE ROLE OF CHINESE BUSINESS INCUBATORS. 36 41. CHAPTER IV THE ROLE OF CHINESE GOVERNMENT IN BUSINESS. sit. y. Nat. INCUBATORS. 4.3 POLICIES SUPPORT. al. n. 4.2 FINANCIAL SUPPORT. er. io. 4.1 OVERVIEW THE ACTS OF GOVERNMENT IN INCUBATION DEVELOPMENT. Ch. CHAPTER VI CONCLUSION. engchi U. v ni. 56 56 65 72 80. 5.1 SUMMARY OF RESEARCH FINDINGS. 80. 5.2 SUGGESTIONS FOR FUTURE RESEARCH. 86. REFERENCES. 88. . IV.

(6) LIST OF TABLES Table 1. The economic indicators of Wuhan EHDZ, 2005-2015 ............................................ 44 Table 2. The statistics data of BIs during the 11th and 12th Five Year Plan (2006-2015)...... 63 Table 3. Monthly domestic applications of patents in 2015 .................................................... 75 Table 4. Annual applications for total patents received ........................................................... 75 . 立. 政治大. ‧. ‧ 國. 學. n. er. io. sit. y. Nat. al. . Ch. engchi. V. i n U. v.

(7) LIST OF FIGURES Figure 1. The number of BIs, incubatees, employee of incubatees, 1995-2015 ..................... 33 Figure 2. The three broader sectors as percentage of China’s GDP, 1995-2015 .................... 38 Figure 3. The growth rate of number of BIs, incubatees and China’s GDP, 1996-2015 ........ 39 Figure 4. The overall economic data of BIs, 1995-2015 ......................................................... 41 Figure 5. The gross industrial output in Wuhan EHDZ, 2005-2015. ...................................... 44 Figure 6. The number of authorized patents in Wuhan EHDZ and Wuhan City, 2011-2015. 45 Figure 7. The number of registered companies and high-tech employment in Wuhan EHDZ, 2005-2015 .................................................................................................................. 46. 政治大. Figure 8. The percentage change of GDP in Shenzhen and China, 2007 and 2015 ................ 51 Figure 9. Shenzhen's GDP, gross output, and number of high-tech enterprises, 2001-2011 .. 52. 立. Figure 10. Shenzhen's gross output in high-tech enterprises, 2001, 2005 and 2011 ............... 53. ‧ 國. 學. Figure 11. The revenue of incubatees and amount of financial aid received by incubatees ... 66 Figure 12. The economic indicators of BIs and incubatees..................................................... 67. ‧. Figure 13. The export, tax submitted and gross industrial output in NHZs, 1995-2015 ......... 71 Figure 14. The monthly change of new registered companies since Jan 2014 to Jan 2015. ... 78. n. er. io. sit. y. Nat. al. . Ch. engchi. VI. i n U. v.

(8) CHAPTER I INTRODUCTION Over the past several decades, global economic growth has faltered to a sluggish pace and the growth of the most advanced economies has softened while unpredictable political situations created new uncertainties for the global economy. Despite global economic slowdown, the economic growth of emerging economies remains strong.. 治政大(China), the world's largest This can be seen in the People’s Republic of China 立 ‧ 國. 學. emerging economy, which has gradually become the major driving force for global economic growth, accounting for over one quarter of the world’s economic growth in. ‧. sit. y. Nat. 2015 (IMF, 2016). In order to stimulate economic growth, more and more policymakers. n. al. er. io. came to realize that supporting innovation and entrepreneurship creation could be a key. i n U. v. element for economic sustainability. One of the means in stimulating sustainable. Ch. engchi. economic growth is to support and establish Business Incubators (BIs). . 1.1 Research Motivation and Background of the Study “Business Incubators” is a term originated in the U.S., known as Yucheng zhongxin (育成中心) in Taiwan, translation of Keji qiye fuhuaqi (科技企业孵化器) in China, and has various related forms in Europe, such as science parks or business centers (KU Leuven, 2016). Even though the extant literature is yet to provide a . 1.

(9) standard definition, business incubators, literally mean a controllable working environment with good care to early stage enterprises, supporting and providing various business resources and services in different stages before ventures are ready for traditional means of sell-sustaining operation, and the controlled working environments could be either real estate and office facilities or networks (Mac Chinsomboon, 2000). The BIs industry originated in the U.S. and has a relatively long history in several. 政治大. countries. In the 1970s, the recession resulted in the economic stagnation in much of. 立. the Western world during the time. Many governments and businesses were seeking to. ‧ 國. 學. reverse the downturn as increasingly unemployment and economic stagnation had. ‧. become major challenges for all countries. Until the late 1970, BIs were considered as. Nat. io. sit. y. a new economic development tool in speeding up job creation and boosting economic. er. growth by supporting the development of innovative and technology-oriented ventures. al. n. v i n C hthe importance of U (Cumming, 2010). Since the 1980s, e n g c h i innovation and entrepreneurship for the economy became increasingly clear. BIs have been seen as a way to stimulate entrepreneurship and innovation in the U.S. and throughout the world. BIs were first introduced to China in 1988 and has been highly praised in the country. China has a different BIs system with the rest of the world, which unique development and experiences create BIs sustained growth and innovative capacity, particularly promote the development of high-tech sectors creating millions of. . 2.

(10) employment and economic output in the communities (科学技术部火炬高技术产业开发中心, 2017a)1. China has a well-developed incubation market as the government playing a predominant role in the BIs program by channeling resources in accordance with the government mandate of high technology-led economic activities. The relevant departments promoted BIs construction and development ever since the State Scientific and Technological Commission released a new bill related to BIs matters in 1994. Since. 政治大. the year of 2001, a series of Five Year Plans (the 10th, 11th, 12th and 13th Five Year. 立. Plans) provided guidance related to BIs’ development. As part of government priorities,. ‧ 國. 學. BIs activities were highlighted through promoting technology innovation and. ‧. entrepreneurship.. Nat. io. sit. y. The purpose of Chinese BIs is to promote technology transfer and. er. commercialization, serving for science and technology (S&T) enterprises (中国政府. al. n. v i n C h2013). On the China’s 湖北省科学技术厅, e n g c h i U Torch High-tech Industry. 网, 2010;. Development Center (Torch Center) of the Ministry of Science and Technology (MOST) (MOST, 2013) website, BIs is defined as an important carrier to cultivate technology enterprises and entrepreneurs, which can speed up the process of high technology commercialization, optimize the industrial structure, expand domestic demand and play an important role in building an innovative country. For instance, Guangdong has the. 1. For convenient reference, this research retains all the original languages of sources in in-text citations and references.. . 3.

(11) largest BIs cluster in southern China. The total economic output of the province was ranked the first in China during the last 27 years, and with an annual economic growth rate of 8.5 per cent (广东省统计信息網, 2016; 国家统计局, 2015). Ogutu and Kihonge (2015) demonstrated that the number of incubators a country has influenced the country's gross domestic product (GDP) very strongly through examining the historical data and statistical analysis. Despite the slowing down of. 政治大. Chinese economy in recent years, its GDP and the number of BIs are still growing year. 立. by year. China is the world's largest emerging market economy, both in terms of. ‧ 國. 學. population and total economic production. China has become the country with the. ‧. largest number of BIs worldwide in 2015 (网易科技, 2016).. Nat. io. sit. y. Wan, the minister of S&T of PRC emphasized (中国网, 2016b; 人民网, 2017). er. that the high-tech industry of the tertiary industry can facilitate the structural reform of. al. n. v i n Ceconomic China's supply side and regional BIs are one of the means to h e n gdevelopment. chi U promote the development of high-tech industry. Zhongguancun in Beijing is a cluster of incubator, which is one of the most successful high-tech development zones in China contributing 24.7% of GDP to Beijing in 2016 (中华人民共和国科学技术部, 2017). As of the 9th Five Year Plan, BIs were included in the national priority. Later 10th to. 13th Five Year Plan also targeted to promote S&T innovation and entrepreneurship through supporting BIs industry (中国政府网, 2016a).. . 4.

(12) The Ministry of Commerce of China (MOC, 2015) considered that expanding the service sector throughout the country is of great significance to the overall reform and opening-up of China. As Chinese government turn their focuses from manufacturing to a service-based economy, more and more spring up emerging sectors drive economic transition, such as e-commerce, internet and technology sectors, to further expansion in service sector. Along with the fact that the significant growth of service sector, the share. 政治大. of tertiary sector was more than 50 per cent of China’s GDP for the first time in 2015.. 立. The tertiary industry became the biggest industry in China.. ‧ 國. 學. As an economic tool, BIs are not only to promote economic growth, but also to. ‧. nurture the development of technology-based enterprises and entrepreneurs. Peking. Nat. io. sit. y. University (2013) considered that technopreneurship could drives sustainable economic. er. growth. BIs are the driving force on technopreneurship, and the technology and. al. n. v i n C h economies to prosperity. entrepreneurship are driving modern engchi U. In recent years, technopreneurship are flourishing in China. Shenzhen is one of the most innovative capacity areas in China, often being referred to as “China's Silicon Valley”, “China startup community” or “startup city”, or even “China's business incubator” (CNN, 2015; Nikkei, 2014). About thousands of startups are active in the city. The number of BIs grew from less than 30 in 2001 grew up to 90 in 2016, which includes 12 state-level and 78 municipal-level incubators (深圳市科技创新委员会,. . 5.

(13) 2012; n.d.). The local government greatly support BIs ecosystem, clearly pointed out that BIs have become an important carrier of Shenzhen cultivating high-tech enterprises, constructing innovative systems, promoting the development of regional high-tech industry, and transferring scientific and technological achievements (深圳市科技创新委员会, 2012). Along with a more open business environment in China, the number of. 政治大. technology-related enterprises, including technopreneurial ventures engaged in. 立. technological innovation, has increased significantly in the last couple of years as. ‧ 國. 學. people are inspired by the success of several technology giants in the world, such as. ‧. Alibaba, Facebook and Tencent etc. The contribution of the new and high-tech fields is. Nat. io. sit. y. impacting modern society.. er. Chinese BIs have been very popular in China's entrepreneurship and witnessed. al. n. v i n C h of BIs reflect economic China’ startups boom. The contribution growth, job opportunity engchi U and innovation creation. This phenomenon is really worth exploring. Although the concept of BIs originated in the U.S., BIs are now being functioning all over the world, especially in China. China is the biggest developing country in the world, as well as the fastest-growing economy in emerging market. China has enjoyed economic growth from its economic and social transformation by joining the World. . 6.

(14) Trade Organization (WTO) and launching economic stimulus measures. One of the measures is to establish BIs. In order to catch the wave of new technological revolution in the world, the Chinese government approved the Torch Program, which would facilitate the industrialization and commercialization of high-tech achievements, established China’s first national BI in Wuhan in 1988. Since then, Chinese BIs are an important component of China’s Torch Program.. 立. 政治大. As the government views BIs could be a solution to oversupply of labor force and. ‧ 國. 學. creating employment opportunity, Chinese BIs particular emphasize providing. ‧. technological services in promoting innovation and technopreneurship, serving for. Nat. io. sit. y. those who are capable of turning their technological savvy into viable, scalable. er. businesses. The China's State Council and the MOST issued relevant guidance on BIs. al. n. v i n BIs C in hmany provinces, U e n g c h i as well. and established national. as strengthening the. cooperation among universities and research institutions. The Chinese senior leaders have been highlighting the importance of startups and BIs in the new landscape of innovation. Premier Li Keqiang has been visiting key incubators with considerable media coverage (People's Daily, 2015; China Daily, 2016). In 2013, Chinese President Xi Jinping made a speech to encourage Chinese youth towards the road of entrepreneurialism (新华网, 2013). In 2014, Premier Li Keqiang. . 7.

(15) gave an address about a “new wave of startups from the masses and grassroots” at the World Economic Forum (WEF) held in Tianjin (中国网, 2014). In 2015, Li delivered a report, “Mass Entrepreneurship and Innovation” as a new economic growth driver on the work of the government, to encourage individuals and enterprises braving in innovating and entrepreneurship (中国政府网, 2015a). Obviously, China's ambitious strategy is trying to move the country from the. 政治大. world's largest manufacturing power to an innovation economy. In order to lead the. 立. country to be sustainable, innovation and entrepreneurship creation have gradually. ‧ 國. 學. become one of the policy priorities.. ‧. The National Business Incubation Association (2012) estimated that there were. Nat. io. sit. y. over 1,250 BIs at the end of 2012 in the U.S., up from only 12 in 1980, and about 7,000. er. of BIs worldwide. In Asia, the number of BIs has grown steadily. According to the. al. n. v i n Ch official statistics (科学技术部火炬高技术产业开发中心, 2017a), China reached engchi U. 2,536 registered BIs in 2015, and the number of BIs have increased by more than 14% per year since the 10th Five Year Plan. In North America, BIs assisted about 49,000 startup companies that provided full-time employment for nearly 200,000 employees and generated annual revenue of almost $15 billion (NBIA, 2012). Regarding the employment creation, in 2014, benefiting from central government policies' support, more than 1,600 BIs have cultivated 80,000 incubatees, created 1.75 million jobs,. . 8.

(16) achieved nearly 300,000 technology transformation, and reached the turnover in technical contract around RMB 857.7 billion (中国政府网, 2016b). BIs have been one of the channels that Chinese people can join tide of Mass Entrepreneurship and Innovation. By 2015, more than 2,500 BIs cultivated 100,000 incubatees (中国政府网, 2016c). The number of startups reached 443.9 million, and over 12,000 enterprises were born every day, while driving the transformation of industrial structure (中国政府网, 2016d).. 立. 政治大. ‧ 國. 學. 1.2 Research Purposes and Research Questions. ‧. As discussed in the previous section, it is important to explore the connection. Nat. io. sit. y. between BIs and Chinese economic development in order to understand the role of BIs. er. in Chinese economy, with the aim to make contribution to the body of knowledge in. al. n. v i n C hMoreover, this research the field of incubations in China. e n g c h i U is also conducted with the goal to provide more insight about the role of Chinese government in leading the emergence of incubators market. The research questions in this research are: 1. What is the main role of BIs in Chinese economic growth? 2. What is the role of the Chinese government in leading the emergence of the Chinese BIs and its performance?. . 9.

(17) 1.3 Research Methodology The qualitative research approach was selected for this thesis. The methodology applied is primarily literature-based, complemented in part with secondary data analysis. The breakdown of research methodology is as following: Literature Analysis. Literature analysis is a method of researching the literature by collecting, analyzing and extracting the required information, and making an. 政治大. objective and systematic research. The research intends to understand the role of BIs in. 立. Chinese economic growth as well as the role of Chinese government in leading the. ‧ 國. 學. emergence of BIs. Relevant literatures will be systematically examined, analyzed and. ‧. synthesized to reach the conclusion for the determined questions. In addition, this. Nat. io. sit. y. research will review the representative BIs studies, journal articles, conference papers,. er. online resources, international, organization's reports and government publication.. al. n. v i n CInh addition to the analysis Secondary Data Analysis. e n g c h i U of relevant studies, the. functions and performance of two main elements of the role of Chinese BIs and Chinese government will be studied in order to understand the factors leading to the emergence and accomplishment of Chinese BIs. In addition, due to the shortage of literature concerning the necessary data of Chinese BIs, particular in the relevant empirical research. Apart from the data derived from the relevant literature, the secondary data including multiple articles, news articles,. . 10.

(18) commentaries from reliable sources and official documents will be collected and analyzed in order to further understand the role of Chinese BIs and the role of Chinese government.. 1.4 Scope and Limitation of the Research Temporal scope of the research. Chinese BIs were included in the national. 政治大. priority in the 9th Five Year Plan (1996-2000) and significantly took off since the 10th. 立. Five Year Plan (2001-2005). It was particularly since 2001 when China joined the WTO,. ‧ 國. 學. the increase in BIs’ activities were impressive. To provide a valuable reference, the. ‧. temporal scope of this research would be from 1995 until present.. Nat. io. sit. y. Study scope of the research. In China, the incubators and incubatees alike depend. er. to a large extent on government policies and funding, the government plays a. al. n. v i n Cbyh channeling resources predominant role in BIs market e n g c h i U and policy supports. This. research will explore the development of BIs program in light of Chinese government policies, to review and evaluate the policies and implementation in terms of the role of government. The evaluation of public policy and public finance are not within the research. Limitation of the research. This research is aimed at providing the macroeconomic study in Chinese BIs development. Due to time and geographical. . 11.

(19) distance constraints, the primary deficiency of this research would be an inability to conduct interview with relevant officials of Chinese government. However, there still are a sufficient amount of relevant reports from government official websites, all of which could make up for this deficiency. Another shortcoming would be that the majority of data and information are from open sources, the depth and breadth of these data may be limited. Nevertheless, a great deal of relevant literature and studies,. 政治大. periodicals, institution reports and commentaries from reliable sources, others official. 立. publications can be utilized to remedy this lack of resources.. ‧. ‧ 國. 學 1.5 Organization of Thesis. Nat. io. sit. y. This research comprises five chapters. Chapter I Introduction contains five. er. sections offering a brief overview of the study, including background of the study,. al. n. v i n research purposes and questions,Cresearch scope and limitation. Chapter h e nmethodology, gchi U II Literature Review provides overview of BIs, including the understanding of BIs, the roles of BIs in economic development and the roles of government in advancing BIs development. Chapter III The Role of Business Incubators in China, which discusses the relationship of BIs program and service sector, and examines the role of BIs in two empirical cases. Chapter IV The Role of Chinese Government in Business Incubators Development examines the role of government in two aspects including. . 12.

(20) financial support and policies support by focusing on the main policies from Chinese government. CHAPTER V Conclusion offers the research result and provides the summary of research finding.. 立. 政治大. ‧. ‧ 國. 學. n. er. io. sit. y. Nat. al. . Ch. engchi. 13. i n U. v.

(21) Chapter II Literature Review BIs originated in Batavia, New York in 1959, where a large local business closed down, left a number of empty buildings and caused rising unemployment. A local resident took over some empty buildings, then leased the space to small and mediumsized enterprises (SMEs). By providing office services and business advices, assistance. 治政 of fundraising, some startups were launched, and created 大thousands of jobs in the area 立 ‧ 國. 學. (NBIA, 2006). This event was considered to be the first time when the concept of BIs was formalized. Later on, in 1960, the first BI appeared in the U.K. as a part of science. ‧. park (Colombo & Delmastro, 2002). In the early 1980s, BIs began to expand in the U.S.. sit. y. Nat. io. n. al. er. and spread to the U.K. and other European countries through various forms. In Asia, China welcomed their first BIs in 1988.. Ch. engchi. i n U. v. 2.1 What are Business Incubators? The National Business Incubation Association of the U.S. (NBIA) defined BIs as entities that accelerate the successful development of enterprises through an array of resources and services, developed or orchestrated by incubator management, offered both in the incubator and through its network of contacts (NBIA, 2012). Another interesting definition of BIs considered that incubator is a controlled environment that . 14.

(22) fosters the care, growth, and protection of a new venture at an early stage before it is ready for traditional means of sell-sustaining operation. In today's world, where information technology and the internet are normal parts of the business environment the term ‘controlled environment’ could be either physical (real estate and office facilities) or virtual (networks) (Merriam-Webster’s, date: 1857; Chinsomboon, 2000, p.24). 政治大. It is notable that the Organization for Economic Cooperation and Development. 立. (OECD, 1997) gave a definition of the term “technology incubator”, argued that one a. ‧ 國. 學. specific type of BIs: a property-based venture which provides tangible and intangible. ‧. services to new technology-based firms, entrepreneurs and universities. In addition,. Nat. io. sit. y. OECD considered that technology BIs have four main objectives including economic. n. al. er. development, technology commercialization, property venture/real estate development, and entrepreneurship.. Ch. engchi. i n U. v. 钱平凡 (2000) defined BIs as a new type of socio-economic organization between market and enterprises. The purposes of BIs are to help new companies start up, survive and grow through providing office space, business services, coaching and mentoring, funding, and access to networks. Over the past few decades, BIs have been developed and adjusted to meet the needs of social changes, economic development and globalization. There has not been. . 15.

(23) a universally accepted definition or standard, as BIs have a different understanding and interpretation in different countries in different periods. Dozens of definitions are available in academic literature, reflecting local cultures, scholars’ vision or national policies. Considering that the concept itself is constantly evolving, the degree of understanding in different countries and their societies is not the same. Since the first Chinese BI was established in 1988, BIs have grown into a major. 政治大. policy instrument for commercializing scientific achievements, cultivating high-tech. 立. enterprises and technopreneurs, promoting innovation and entrepreneurship, and. ‧ 國. 學. aiming to build China into an innovative country (中华人民共和国科学技术部, 2006a;. ‧. 中国政府网, 2010).. Nat. io. sit. y. As an important part within the policy framework of China's S&T, BIs are viewed. er. as special service agencies in terms of S&T sector, and they are identified, managed. al. n. v i n C h Examples of representative and sponsored by Chinese government. BIs include Beijing engchi U Zhongguancun and Wuhan East Lake High-tech Development Zone (or High-tech. Industrial Zone, Innovation Center), which belong to the state-level incubations as well as one of the main contributors to regional economy. It is widely accepted that BIs in China are referring to technology-oriented incubators, which are officially called “Technology Business Incubators” (中华人民共和国科学技术部, 2006a;中国政府网, 2010). In view of China's special incubation. . 16.

(24) market, the Chinese Business Incubators (BIs) in this research mainly refer to Technology Business Incubators.. 2.2 The Role of Business Incubators in Economic Development A great deal of studies have discussed the role of BIs’ in different scopes and purposes in the history of economic and social development. This section reviews the. 政治大. roles of BIs which are mostly discussed.. 立. Creating Employment Opportunities. After the stagnation of the U.S. economy. ‧ 國. 學. during the 1970s - 1980s, BIs were effectively used as a new economic development. Nat. io. sit. non-value-adding activities (De Cleyn & Festel, 2016).. y. ‧. tool since they offered low-cost services, reduced overhead costs and time devoted to. er. More and more policymakers realize that investment in entrepreneurial support. al. n. v i n C h to a study conducted infrastructure is important. According e n g c h i U for the U.S. Department of. Commerce Economic Development Administration (U.S. EDA, 2011), BIs provide communities with significantly greater results at less cost than do any other types of public works infrastructure project. It showed that incubators provide up to 20 times more jobs than community infrastructure projects. As a result, BIs need to be a part of the job creation equation.. . 17.

(25) BIs in the EU make a significant contribution to job creation. A research cited that United Kingdom Business Incubation (UKBI) runs more than 300 BIs operated in the U.K. and directly support 12,000 companies while 40,000 additional firms experience indirect benefits from this support, creating more than 50,000 jobs in the nation (Dee et al., 2011). In addition, a report from the Centre for Strategy & Evaluation Services (CSES, 2002) studied that till 2002, some 40,000 new (net) jobs were generated each. 政治大. year by BIs, and the growth of BIs also create indirect effects on employment. The. 立. study also estimated a ratio of 1:1.5 for direct:indirect job creation from incubatees.. ‧ 國. 學. Nowadays, BIs have become a popular tool for local economic development and. ‧. employment. Monkman (2010), the former President & CEO of National Business. Nat. io. sit. y. Incubation Association (NBIA), also viewed that the most common goals of BIs are. er. creating jobs in a community, enhancing a community’s entrepreneurial climate,. al. n. v i n C hbuilding or accelerating retaining businesses in a community, e n g c h i U growth in a local industry, and diversifying local economies. Supporting SMEs and Entrepreneurs. In recent years, entrepreneurship has re-. emerged as an important component underlying economic growth around the world. Wong et al. (2005) indicates that the trend toward an entrepreneurial society is accelerating. Entrepreneurship development is perceived to have a positive impact on economic growth, which can be locally fostered through BIs (Lesákova, 2012). Craig. . 18.

(26) et al. (2004) also emphasized that small businesses are important to economic vibrancy, employment growth and wealth creation for almost all economies. Al-Mubaraki and Busler (2011a) examined 10 case studies of BIs in developing countries, and found that BIs are an effective and innovative tool in supporting the startup businesses. It is generally accepted that SMEs lack the necessary resources to effectively scale up and grow their businesses. Yet BIs offer some of the greatest opportunities for. 政治大. innovation, employment and value creation. Dichter et al. (2010) have shown that BIs. 立. can be an effective tool for supporting local innovation, new business creation, and can. ‧ 國. 學. reduce SME failure rates substantially. Experience in Israel has demonstrated that one. ‧. of the right support incubating system in creating SMEs’ is the use of BIs with business. Nat. io. sit. y. support, which was really promoting Israel’s GDP (OECD,2010a; Berry, 2009).. er. In Europe, Aernoudt (2004) argued that BIs are bridging the entrepreneurial gap. al. n. v i n C become and exploring how the region can more business friendly. In addition, a study heng chi U. emphasized that BIs are the place where the incubation activities are carried out, and where entrepreneurs and the existing SMEs would find a suitable place, in terms of facilities and expertise, to address their needs, develop their business ideas and transform them into sustainable realities (Dichter et al., 2010). In addition, BIs were sufficient to stimulate the growth of new companies as their activities have proven to be very successful within entrepreneurship-friendly. . 19.

(27) environment. To get the funding from investors, BIs assist ventures to transfer scientific and technological achievements, as well as to prepare to bear the risk inherent in early stage technology development (De Cleyn & Festel, 2016). The chairman of UKBI, Russell (2010), considered that BIs have an above average chance of success as the innovators and entrepreneurs could better prepare to turn their business ideas into successful startups. He indicated that BIs environments reduce the. 政治大. risk of business failures. Furthermore, BIs practitioners report generally showed that. 立. more than 85 per cent of all firms that exited from their BIs are still in business, compare. ‧ 國. 學. with a standard survival rate for startups of around 50 per cent.. ‧. Ogutu and Kihonge (2015) examined countries such as the U.S., China, and. Nat. io. sit. y. Germany, found that the countries with high economic growth have the highest number. er. of BIs, and the number of incubators a country has influenced the country's GDP very. al. n. v i n Cthat strongly. Their findings indicated a very strong connection between the h ethere n gwas chi U amount of BIs and the economic growth of a country, and showed that BIs have a great amount of influence over the entrepreneurship development. Promoting Innovation Creation. Incubation is a strategic tool of enterprise development and economic growth, it provides a leap from imitation to innovation (Lalkaka, 1997). Al-Mubaraki and Busler (2011b) found that one of the important benefits of BIs is the pace of innovation as the potential applications of BIs including. . 20.

(28) promoting the establishment and long term survival of new ventures that will likely lead to a significant increase in job creation as well as promoting a climate of innovation and entrepreneurial spirit. Regarding the importance of innovation in today’s world, the White House (2010) of the U.S. indicated that the 21st century will be shaped and built by technologies and innovation because the innovation will create new jobs and catalyze broadly shared. 政治大. economic growth. One of their strategies is to encourage high-growth and innovation-. 立. based entrepreneurship as it is essential for entrepreneurs continue to create new and. ‧ 國. 學. vibrant businesses that lead to new jobs and economic growth. It is clear that supporting. io. sit. y. Nat. of BIs program.. ‧. innovation creation is an important economic tool, and it is one of the significant roles. er. Promoting Technology Transfer and Commercialization. Another role of BIs. al. n. v i n Cbetween is designed to help bridge the gap and innovation in order to let the h e n knowledge gchi U research innovation to the marketplace, which promotes transformation of scientific and technological achievements (Lesákova, 2012). Peters et al. (2004) argued that BIs are to act as an intermediary or mediator between incubatees and relevant critical systems. An OECD report (2010b) indicated that BIs have the ability to transfer the knowledge from universities to industries. In addition, a study indicated that research facilities at universities and public research institutions start to transfer their research. . 21.

(29) findings and commercialize their intellectual property (IP), which have led to a growth of incubators (De Cleyn & Festel, 2016). The above studies have shown that BIs can convert research ideas and research results into sustainable businesses. In general, stimulation of technology transfer and research commercialization are generally considered as important components in goal portfolio of incubators activities, especially in the case of BIs and science parks (Grimaldi & Grandi, 2005). In addition,. 政治大. BIs can create a sound ecosystem between universities and researches. BIs in not-for-. 立. profit university science parks have been the recipients of business income tax. ‧ 國. 學. concessions, which is thought that this will encourage universities to undertake more. ‧. research and technology transfer, thereby accumulating more funding to reinvest in. Nat. io. sit. y. R&D (Su et al., 2011).. er. Revitalizing neighborhoods. Monkman (2010) found that BIs and incubatees are. al. n. v i n C hrole in developingUand transforming economies, playing an increasingly important engchi which have shown positive impact in the community and improved the local climate for entrepreneurship to create jobs. Many communities are recognizing the need to help local residents build new businesses from the ground up through BIs. In addition, the majority of BIs stay within the community after graduation as more and more policymakers provide incentive mechanisms in encouraging entrepreneurship. BIs nurture entrepreneurs who create enterprises, some of incubatees create direct and. . 22.

(30) indirect employment after leaving BIs. Their incomes and assets in turn contribute to economic growth. Moreover, the Silicon Valley in the U.S., Tel Aviv in Israel, and Zhongguancun in China are surrounded by universities, S&T and innovation parks as they encourage their partnerships with graduates to start new businesses with innovative ideas (Ogutu & Kihonge, 2015; Liefner et al, 2006). It is clearly that any forms/models of BIs have. 政治大. capacity to stir development in the surrounding neighborhood.. 立. ‧ 國. 學. 2.3 The Role of Government in Business Incubators. ‧. In terms of government aspect, Lalkaka (1996) pointed out that the success of the. Nat. io. sit. y. BIs is not only in the strength of the technopreneur, but also in the state policies. Both. er. of them stimulate innovation and contribute to the BIs' performance. The boom of BIs. al. n. v i n C h support. The central is also fueled by Chinese government e n g c h i U and local governments have taken unprecedented steps to develop incubating system. The government put resources in place to encourage their young generations enter into this new startup system. When the Chinese government wants something, it seems to always happen. This might be one of the reasons for this massive growth of the startups scene across China. The government’s roles include supporting BIs in the initial stage, providing supportive policy and sound infrastructure, and offering financial support.. . 23.

(31) Supporting Business Incubators in the Initial Stage. In view of the structural barriers in the environment to the creation of private sector, coupled with the need to have effective transition to the market system, the Chinese government uses BIs as policy tools of market creation by offering financial support for construction and operations (Chandra, 2007).. 政治大. Lalkaka (2000) argued that the government, universities or other sponsors should. 立. support BIs at its very early stage, in the form of a low (or no) rent vacant building and. ‧ 國. 學. operating subsidies, until rents and fees from incubatees grow to match operating. ‧. expenses. The support providers can see this an investment in the social infrastructure. Nat. io. sit. y. while also obtaining tax income, foreign investment, culture change and other benefit.. er. BIs will need strong government support in the initial years, and the private. al. n. v i n C hand commercial institution associations, such as entrepreneurial could be brought in as engchi U partners from the start. All the available networks could play an overall role in promoting BIs concept and mobilizing wide support. In fact, BIs will have a better chance of sustainability if getting the political support of government agencies as well as financial and substantive involvement of local sponsors and the state, particularly at the initial startups stage (Lalkaka, 2000).. . 24.

(32) Supportive Policy and Sound Infrastructure Provider. BIs are one of the strong sources of creating SMEs. The survival of SME’s is seen as an important component of economic growth and development especially among developing countries. Ayyagari et al. (2007) showed that governments support enterprise development by providing a suitable business environment for creation, growth and proliferation of SME's rip high dividends in terms of increased job creation especially for the youth. 政治大. entrepreneurship, economic growth and poverty reduction.. 立. Lalkaka (2000) argued that the supportive state policies and sound technical. ‧ 國. 學. infrastructure are the prime responsibilities of governments, such as a good financial. ‧. system. A sound environment could greatly support BIs facilities and services that. Nat. io. sit. y. could tailor to their special needs when the technology-oriented businesses encounter. er. difficulties from technical, financial, personnel or other resources.. al. n. v i n C h economic growth Ogutu & Kihonge (2015) discussed e n g c h i U in some countries like Brazil,. Israel, South Korea and Spain. The key factors in the rapid economic growth is clearly an enabling operating environment, entrepreneurship support policies, government support to technology diffusion, market access and business support services, such as BIs and startups centers. Business environment in Germany is closely related to composition of startups entrepreneurs. It showed that enterprises in Germany are supported by an integrated business support ecosystem that involves universities,. . 25.

(33) national and local government, sources of funding and existence of technology, startup centers and incubators devolved all over Germany. Financial Supporter. In addition to providing a sound infrastructure, supporting the initial funding is essential for incubators successfully starting its businesses. Lalkaka (2000) indicated that for the financial structure of a for-profit incubator in the U.S. state and city governments has an important role in the capital investment. In the. 政治大. initial support and prudent management, several states of the U.S. brought annual profit. 立. to its owners which is ploughed back in to expansion and improvement of facilities.. ‧ 國. 學. Those state and city governments also benefited by the creation of local jobs, tax. ‧. collection and an entrepreneurial culture in the community.. Nat. io. sit. y. In China, the government plays a predominant role in BIs funding, supporting and. er. operation. The Chinese government impacts BIs including model, organization,. al. n. v i n C h2002; 顾军, 2005;U王咏, 2016). The differences of funding and strategy (Scaramuzzi, engchi. the development and distribution decided the level of development in eastern, central and western China (李具恆 & 張美玲, 2009). Chinese government is not only managing the majority of BIs but is the main financial provider. Funding is one of the essential elements for Chinese BIs sustainability. The government involvement could sustain BIs operation, it causes the lack of BIs' own profitability as BIs heavily rely on the government's financial support and management (顾军, 2005).. . 26.

(34) In the U.S., the government is also one of the main financial supporter in BIs industry, the other sponsors are universities and corporates along with rental and consulting income. The government funding sources includes the State economic development agencies, capital funds from the State’s legislative allocation, and State's competitive and matching grants (Knopp, 2007).. 政治大. BIs in the U.S. have several types of formal and informal financial supports. The. 立. formal sources are mainly from public support including capital funds from the State’s. ‧ 國. 學. legislative allocation for BIs infrastructure, competitive grants from the State to select. ‧. BIs, matching grants for service support for new ventures and funds that were. Nat. io. sit. y. channeled through the State Economic Development Agency. The informal support. n. al. er. included tax incentives in BIs, private partnership funding for BIs operational funds etc. (Chandra & Fealey, 2009).. Ch. engchi. i n U. v. Concluding Remarks. As the concept of BIs are a relatively new, popular and the phenomenon mixed different background and environment, many scholars discussing and arguing over the roles, factors and evaluation underlying its accomplishment. It could be observed that many studies have discussed the roles of BIs and the roles of governments in economic and social development. However, few of them investigated the role of Chinese BIs in specific case study, and the role of Chinese government in. . 27.

(35) leading the emergence of the development of Chinese BIs, partly due to the lack of relevant materials. In light of this, this research is thus aiming to provide more insight about the connection of BIs, economic development and the role of Chinese government by examining representative cases and policies analysis.. 立. 政治大. ‧. ‧ 國. 學. n. er. io. sit. y. Nat. al. . Ch. engchi. 28. i n U. v.

(36) Chapter III The Role of Business Incubators in China China has a different incubation market unlike the rest of the world, which unique development and experiences create BIs sustained growth and innovative capacity. Chinese BIs experienced the evolution of the past few years, and gradually became the essential part of Chinese innovation systems as they provide services with more. 治政 distinctive features and objectives. In this Chapter, incubations 大 in the two representative 立 ‧ 國. 學. regions, Wuhan and Shenzhen will be examined in order to understand the critical roles of BIs in regional economic development.. ‧ sit. y. Nat. io. n. al. er. 3.1 Overview of Chinese Business Incubators. i n U. v. Most BIs in China were founded by the Chinese government in order to develop. Ch. engchi. China's S&T capacity. The incubators in China emerged in the year of 1988 when the first state-level BIs was formally established in China. It was the first BI predominantly founded and operated in a high-tech development zone by government. Over the past decades, Chinese BIs have played a remarkable role in transforming the Chinese economy as the government is aiming to improve China’s competitiveness in S&T development.. . 29.

(37) The director of Torch Center viewed that there are 5 types of BIs in China, which includes type of Investment-Oriented, type of Counselling Training, type of Media Extension, type of Professional Services and type of Makerspace (人民网, 2015). Type of Investment-Oriented. This type of BIs are helping startups who meet financing problems, helping incubatees connect investment resources, and advancing ventures odds of success. Garage Café (chekucafe) is one of the representative. 政治大. incubators, it provides one-stop investment and financing solution, helps incubatees get. 立. financing assistance in the short time.. ‧ 國. 學. Type of Counselling Training. To enhance the entrepreneurial capacity, this type. ‧. of BIs focus on entrepreneurship education and training counseling, and making full. Nat. io. sit. y. use of their network resources. They invite well-known entrepreneurs, venture capital. er. experts, industry experts as mentors, offer counselling for entrepreneurial companies.. al. n. v i n C hTraining Camp is U Peking University Entrepreneur's e n g c h i one example, which provides a. series of curriculum training and mentor program by using university educational resources and alumni resources during the earlier stage of incubatees. Type of Media Extension. This type of BIs are founded by the media. These BIs use the advantages of media promotion and make a combination of online and offline services. They provide a comprehensive business resources, including publicity, information and investment and more. The typical one is 36Kr, which is a technology. . 30.

(38) media platform. 36Kr is one of the leading service providers for internet entrepreneurial enterprise, including the media 36kr.com, financing platform and enterprise incubator Kr Space. Type of Professional Services. This type of BIs are established by leading companies of the industry. They committed to serve mobile internet industry by providing social networking, professional and technical services, and supporting. 政治大. industrial resources. These BIs are having cloud computing ability, such as Microsoft. 立. Cloud Accelerator Program. The Microsoft Cloud Accelerator Program is a series of. ‧ 國. 學. targeted learning resources and experiences that provides clear guidance on how. ‧. customers can increasingly take advantage of the benefits of cloud.. Nat. io. sit. y. Lastly, Type of Makerspace. Makerspace is a concept of open workshop that. er. provide access to a range of tools and resources for making physical objects. To serve. al. n. v i n enterprises who have individualC needs, U up on the ideas from internet h e these i set n g cBIshare and technology fields, and providing open source hardware and 3D printed. manufacturing tools. They are such a converter transforming ideas into real products, offering a platform for products making, workshop coaching and mentoring, product design counseling, supply chain management services and idea brainstorming. The typical one is Chaihuo Makerspace, which provides an open and collaborative environment for makers who want able to make their ideas happened and encourages. . 31.

(39) cross-field communication through meetup and workshop. Chinese people see makerspace is an approach to help China cultivate an attitude of “self-making” and “self-entrepreneurship”. Along with a more open business environment in China, the number of technology-related enterprises, including technopreneurial ventures engaged in technological innovation, has increased significantly in the last couple of years. Also,. 政治大. China’s incubators and incubatees have grown faster than in other countries and have. 立. created millions of job openings. By the end of 2015, incubators and incubatees reached. ‧ 國. 學. 2,536 and 102,170 respectively, and would be more than double in near future. The. ‧. number of employees of incubatees was less than 30,000 people in 1995 went up to. Nat. n. al. . Ch. engchi. 32. er. io. two decades. The results are given in Figure 1.. sit. y. over 1.5 million people engaged in BIs system, nearly 65 times of growth over the last. i n U. v.

(40) 1000000. 10,000. 100000 1,000 10000. 166.2. 1000. 100. 100 10 10 2.57 1 1995 1996 1887 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015. 1. 政治大. Number of Employees of Incubatees (10,000 person) Number of Incubatees. 立. Number of BIs. ‧ 國. 學. Figure 1. The number of BIs, incubatees, employee of incubatees, 1995-2015 Source: 科学技术部火炬高技术产业开发中心 (2017a). ‧ sit. y. Nat. io. n. al. er. As one of the most important policy initiatives, the MOST set up a Torch Center. i n U. v. to guide the development of BIs, and was put in place in 1988 with the purpose to. Ch. engchi. reinforce overall environment for technology innovation and to promote high-tech industrialization (Torch Center, n.d.). Of all the programs initiated by Chinese government, the Torch Program is not only the one program to start China's high-tech innovation but to boost startup companies. The Torch Program has four major parts, one of them is supporting BIs in providing technology services. The Torch Program is a part of the MOST priority, aimed at providing great support of BIs in China, and has made massive investments in BIs through its . 33.

(41) incubating funds. In order to speed up the establishment of BIs fostering and tutorial system, the government has several lines of dedicated funds to support BIs in the form of “construction” funds for BIs, “seed capital” funds for startups and “innovation” funds for SMEs that are in the growth phase of their life cycle (中华人民共和国科学技术部, 2002a). In the process of the development of socialist market economy with Chinese. 政治大. characteristics, Chinese BIs have different features comparing to BIs in other countries.. 立. They are grouped into three main characteristics by their organizer including high-tech. ‧ 國. 學. development zone, university science park and private entity (Ping, 2005).. ‧. High-tech Development Zone. With BIs program is an important component of. Nat. io. sit. y. high-tech development zone. The first Chinese BI, also the first state-level BI, was. er. driven by the government and set up in the high-tech development zone. Chinese high-. al. n. v i n C hthe country's industrial tech development zones have led e n g c h i U innovation, and played an important role in the nation's social and economic development. The most representative one is Zhongguancun Science Park. The park is the first state-level hightech development zone and has attracted countless incubators, accelerator programs, startup grants and venture capital funds that are the elements needed to help Chinese young entrepreneurs succeed.. . 34.

(42) University Science Park. To encourage university students to start a business while in college, the Chinese government has been actively constructing University Science Park since the 1990s. The incubation form of university-based scientific research facilities have strong research capabilities and scientific and technological innovation to assist the promotion of regional economic development. According to a survey, the number of University Science Park grew from 44 in 2002 to 100 in 2015. 政治大. (凤凰新媒体, 2015). Peking University Science Park is a prime example. This park is. 立. located at the center of the Zhongguancun Science Park, where talent resources and. ‧ 國. 學. technical personnel are the most concentrated and is often referred to the hotbed for. ‧. high technology in China.. Nat. io. sit. y. Private Entity. With the growth of BIs, Chinese private entities also join BIs. er. market. The first private BIs was established at the end of 1999 in Nanjing (陈吴 &. al. n. v i n C h private BIs began 殷群, 2008). Since 2002, Chinese e n g c h i U a trend of diversification in operational models, becoming more market-oriented, focusing on specific sectors, multiplicity of ownership and intensifying networks (陈吴 & 殷群, 2008). Garage Café is one of the successful examples. Garage Café is a popular space in Beijing for startups, entrepreneurs, investors, and companies to meet, work and talk. The space focuses on nurturing internet and high-tech startups, and promotes people cooperation in different fields. Garage Café designed the cafe as a platform for startups to find all. . 35.

(43) the necessary resources and help their need. It is a place, where ideas meet capital. It can be seen that the private incubators can stimulate the enthusiasm of private capital into BIs ecosystem, as well as creating the unique culture of Chinese entrepreneurship. In summary, BIs in China are focusing on nurturing entrepreneurs with the goals of economic development, job creation and S&T services. However, these strategic objectives tended to vary with the business model of the BIs and the type of sponsorship. 政治大. of government involvement. The source of incubator funding in many instances. 立. determines the BIs’ strategic focus and incubatees selection. For instance, government-. ‧ 國. 學. funded BIs operate with a goal of economic development, relative to a university-. ‧. affiliated BIs that may have technology transfer as its primary goal. Additionally, more. Nat. io. sit. y. and more Chinese private entities join BIs market. Many specialized BIs provide. er. services with more distinctive features and objectives, focus on specific sectors and. al. n. v i n C hpopularity in various more market-oriented. As BIs gain e n g c h i U parts of the world, incubator. models have evolved in variety and complexity along with the environment and society.. 3.2 Business Incubators and Service Sector The Chinese economy has witnessed tremendous transition and growth since the reform and opening-up policy in 1978. The rapid growth of BIs plays an important role. . 36.

(44) in facilitating China’s transitions from a centrally planned economy to a capitalist market economy. The change is promoting the country toward a service-based economy. China is the world's largest emerging market economy, both in terms of population and total economic product. Its gross domestic product (GDP) is broadly contributed by three broader sectors or industries, including primary industry (or agriculture), secondary industry (or construction and manufacturing) and tertiary industry (or service. 政治大. sector). In modern society, S&T sector is one of the most actives sectors in the tertiary. 立. industry. To provide S&T services to high-tech enterprises, the incubation system is. ‧ 國. 學. included in the major part of Torch Program as BIs are an important carrier in. ‧. promoting S&T services in Chinese economy.. Nat. io. sit. y. Since 1995, The service sector’s share of GDP has increased every year. Along. er. with the fact that the significant growth of service sector, the share of tertiary sector. al. n. v i n C h GDP for the firstUtime in 2015 (see Figure 2). It was more than 50 per cent of China’s engchi. is a remarkable fact that the tertiary industry exceeded secondary industry for the first time in 2013. Since then, the tertiary industry has become to the biggest industry in China as well as being the main force to promote China's economic growth.. . 37.

(45) Industry Value Added (% of GDP). 60 Tertiary industry 50 40 Secondary industry 30 20 Primary industry 10 0. Figure 2. The t. 政治大 hree broader sectors as percentage of China’s GDP, 1995-2015 立. Source: 中华人民共和国国家统计局 (2016). ‧ 國. 學. The minister of MOST views that the high-tech sector of tertiary industry has the. ‧. ability to promote China's supply-side structural reform and economic transformation. sit. y. Nat. io. n. al. er. and upgrading (中华人民共和国科学技术部, 2017a). Chinese BIs are viewed as big. i n U. v. innovative clusters which gather high-tech enterprises and offer business resources to. Ch. engchi. promote S&T progress. For instance, Beijing's Zhongguancun own the largest BIs cluster in northern China, which contributed 24.7 per cent of GDP to Beijing in 2016 (中华网, 2017). Science and technology are closely related to each other, and BIs are a platform to make it happen -- transfer research result to productivity. The growth of Chinese economy has decreased significantly over the past few years. Since 2008, the annual growth rate of GDP has gradually declined, while the growth rate of Chinese BIs and incubatees were not affected by GDP downturn. The . 38.

(46) evidence can be observed in Figure 3. Although China's GDP growth rate dropped to 7 per cent in 2015, the growth rate of BIs and Incubatees reached 45.1 per cent and 29.4 per cent respectively. Figure 2 and Figure 3 have shown the positive correlation between the increasing trends of BIs and tertiary industry. It is clearly that BIs as a key carrier of S&T sectors playing one of the most essential roles in tertiary industry.. 110%. 立. 90%. 2000. 7.0%. sit er. 1998. 2004 2006 2008 a 2002 v2010 i l C n Annual Growth Rate of the NumberU h e n g c h i of BIs Annual Growth Rate of the Number of Incubatees. n. 1996. io. -10%. 29.4%. y. Nat. 10%. 45.1%. ‧. 30%. ‧ 國. 50%. 學. 70%. 政治大. 2012. 2014. Annual Growth Rate of China's GDP. Figure 3. The growth rate of number of BIs, incubatees, and China’s GDP, 1996-2015 Source: 中华人民共和国国家统计局 (2016); 中华人民共和国科学技术部 (2015a). China is trying to become a service-based economy through implementing various economic tools and political measures. A report (Kelley et al., 2016) by the Global Entrepreneurship Monitor (GEM) concluded that the establishment of BIs is one the. . 39.

(47) essential means that can deal with youth unemployment in developing economies. In China, the annual growing number of BIs reflects the growth of incubatees, and the rise of incubatees leads a significant increase in job creation and annual income of BIs market. Additionally, more and more incubating enterprises leave BIs system as they have learnt the survivability of social adaptation. Those economic indicators including the number of incubators, incubatees and employees of incubates are growing stably as. 政治大. illustrated in Figure 4, which demonstrated that BIs have played a remarkable role on. 立. regional economic development and job creation. The more BIs established in the areas. ‧ 國. 學. means the more job opportunities and income created in the regions. A surge of Chinese. ‧. BIs witnesses that BIs is one of the best choices for China’ startups. BIs have been. Nat. io. sit. y. proved that there is a strong case on the role of BIs in the overall promotion of. er. entrepreneurship development and economic development by development of. al. n. v i n enterprises and creation of jobs C (Waeltring h e n g& cDornberger, h i U 2014).. . 40.

(48) 1,000,000. 180 160. 100,000. 140. per person. 120 100. 1,000. 80. 100. 60. 10,000 person. 10,000. 40. 10. 20 2015. 2014. 2013. 2012. 2011. 2010. 2009. 2008. 2007. 2006. 2005. 2004. 2003. 2002. 2001. 2000. 1999. 1998. 1887. 1996. 0 1995. 1. Number of Employees of Incubatees (10,000 person). 政治大. Number of BIs (unit). Number of Incubatees (unit). 立. Accumulated Number of Incubatees Graduating (unit). ‧ 國. 學. Figure 4. The overall economic data of BIs, 1995-2015 Source: 中华人民共和国科学技术部 (2015a). ‧. Nat. io. sit. y. 3.3 Two Cases on the Role of Chinese Business Incubators. er. To improve the innovative capacity and S&T development of the country, some. al. n. v i n C hby Chinese government of the major cities and areas selected e n g c h i U to establish national high-. tech development zones. The selected cities and areas can lead to economic output with an economic radiation effect over its nearby areas. In order to explore the critical roles of BIs in the impact of regional economic development, the typical incubation systems including Wuhan and Shenzhen are selected in this chapter. Wuhan, the capital of Hubei province, is the birthplace of Chinese BIs. The city has for decades been a traditional base for manufacturing, and has also become one of. . 41.

(49) the areas promoting modern industrial change. Benefitting from its strategic position in central China, Wuhan naturally became a hub for the efficient distribution of products for many industries, particularly in modern manufacturing and high-tech industries. Shenzhen is a city of sub-provincial administrative status in Guangdong province, and often referring as “China's Silicon Valley”. Under economic liberalization policies of the 1980s carried out by Deng Xiaoping, the city became China's first and the most. 政治大. successful “Special Economic Zone”. Shenzhen has focused on high-tech industries. 立. and high-value added production and services over the last decade.. ‧ 國. 學. Some of the startups coming out of incubation, such as China's best known. ‧. international brands Lenovo (computers), Huawei (telecommunication), Suntech. Nat. io. sit. y. Power (solar energy) and DJI (civilian-drone) are among the companies which have. n. al. er. graduated from BIs system in China (Proksch, 2015; South China Morning Post, 2017).. Ch. engchi. i n U. v. 3.3.1 Wuhan: Case of the First Business Incubator in China In June 1988, Wuhan witnessed the establishment of China's first BI, Wuhan East Lake High-tech Development Zone (EHDZ), which is also the first state-level incubation system driven by the government and set up in the high-tech development zone. As one of China's most famous and developed state-level high-tech development zones, Wuhan EHDZ gathered and cultivated a large number of knowledge-intensive. . 42.

(50) high-tech enterprises through promoting the interaction between industry, university and research institutes. The development of BIs system is one of the key measures to promote economic output in Wuhan EHDZ. According to the website of the government of Hubei Province (2016), all the high-tech development zones in Hubei have incubated over 50 per cent of high-tech BIs, 60 per cent of high-tech enterprises and 50 per cent of authorized patents of the region, which greatly contributed S&T achievement.. 立. 政治大. Although there is no complete data available on how many BIs and incubatees are. ‧ 國. 學. in Wuhan EHDZ, the economic output presents real contribution by launching. ‧. economic measures. The incubation of Wuhan EHDZ accumulated over 35,000. Nat. io. sit. y. registered enterprises, created nearly ten thousand new registered companies, and. er. supported 511,934 direct jobs in the area. The contribution also reflected on the growth. al. n. v i n trend of gross industrial outputC inh Wuhan EHDZ. Over e n g c h i U the decade (2005-2015), the. gross industrial output grew 11 times and reached over 28 per cent in the average growth rate. The evidence can be observed from the economic indicators in Figure 5 and Table 1.. . 43.

(51) Gross Industrial Output 8000. RMB 100 million. 7000 6000 5000 4000 3000 2000 1000 0 2005. 2006. 2007. 2008. 2009. 2010. 2011. 2012. 2013. 2014. 2015. Figure 5. The gross industrial output in Wuhan EHDZ, 2005-2015.. 政治大. Source: 武汉东湖新技术开发区政务网. (2017). 學. ‧ 國. 立. Table 1. The economic indicators of Wuhan EHDZ, 2005-2015. ‧. n. er. io. sit. y. Nat. al. Ch. engchi. i n U. v. Source: 武汉东湖新技术开发区政务网. (2006, 2007, 2011, 2012, 2013, 2014, 2016 & 2017); 武汉市科学技术局 (2016). Apart from the gross industrial output, the Wuhan EHDZ has created impressive number of authorized patents each year. The amount of authorized patents of Wuhan EHDZ has accounted for nearly 50 per cent of the total authorized patents of Wuhan city. The evidence can be observed in Figure 6, showing a remarkable increase from. . 44.

(52) the year 2011 to 2015 (武汉市科学技术局, 2016; 武汉东湖新技术开发区政务网, 2017). The Wuhan EHDZ has the largest contribution of authorized patents in the region.. 25000. 21740. 20000 15901 15000. 13689 11588. 10000. 6963. 立. 4634 5000. 政治大 8501. 9882. 9533. 2011. 2012. 2013. 2014. 2015. Number of Authorized Patents in Wuhan EHDZ. ‧. ‧ 國. 學. 0. 16553. Total Number of Authorized Patents in Wuhan City. y. Nat. sit. Figure 6. The number of authorized patents in Wuhan EHDZ and Wuhan City, 2011-2015.. n. al. The employment status. er. io. Source: 武汉市科学技术局, (2016); 武汉东湖新技术开发区政务网, (2017). v i n C Wuhan in EHDZ wasUalso impressive. heng chi. As the key. innovative demonstration area as well as the first national BI in China, the central and local governments have made massive financial and policies support to Wuhan EHDZ. Meanwhile, as a pioneer of Chinese S&T development, Wuhan EHDZ is linked to the government's vision and expected to be an undertaker in public responsibility. According to the statistics by local government (武汉东湖新技术开发区政务网, 2017), the number of persons engaging in high-tech incubates has increased nearly 4. . 45.

(53) times during the past decade (2005-2015). There is no less enthusiastic about the accumulated number of registered companies and yearly new registered companies in Wuhan EHDZ. The average annual growth rates were growing stably, roughly 14 per cent and 47 per cent respectively. The growth trend of the three indicators is illustrated in Figure 7.. 立. 10000. sit. y. Nat. 1. ‧. 10. 500000 400000. ‧ 國. 100. 600000. 300000 200000. per person. 1000. 政治大. 學. Number of Companies. 100000. 100000 0. io. er. 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 Number of Persons Engaged in High-tech Incubatees. n. al. i n C Number of New h eRegistered hi U n g cCompanies. v. Accumulated Number of Registered Companies. Figure 7. The number of registered companies and high-tech employment in Wuhan EHDZ, 20052015. Source: 武汉东湖新技术开发区政务网 (2017). The economic outcome of Wuhan EHDZ was mainly due to the government support. Wuhan EHDZ has received four national pilot policies supporting 264 hightech incubatees, incubating 9,621 new registered S&T enterprises as well as enjoying the income tax deduction of RMB 260 million. The latest statistics also pointed out that . 46.