By Tian Jietang, Department of Techno-Economy of DRC

Research Report No 105, 2015 (Total 4790)

Abstract:

Reform and innovation mark two major sources for productivity improvement under the new normal. Instead of keeping independent from each other, they complement one another. Innovation requires reform to stimulate vigor and unleash more room for application; while reform calls for innovation to strengthen impetus as the latter tends to propel the former to advance further. If the progress of reform and innovation can be coordinated and jointly advanced, it is likely to achieve more effects with fewer efforts. Otherwise, a scenario might occur where the two obstruct each other. Namely, the innovation effects cannot be brought into full play due to lack of reform measures and it would be difficult to help raise the quality and efficiency of traditional industries; or due to inactive innovation, reform is found to advance with less impetus. It is suggested that we locate some traditional sectors as breakthrough points, relax market access for emerging innovative enterprises, introduce positive competition, and then gradually promote reform of existing resources and industries, which will bring about positive interaction between innovation and reform, create new growth drivers and enable China's economy to move up to the middle and high range of development.