Entrepreneurial Engines of Economic Growth around the World
Edited by Jerome S. Engel
Chapter 10: China: emergence of an entrepreneurial economy in an uncertain environment
In their 2009 article, Engel and del-Palacio extend the concept of industry clusters initially posited by Porter (1990) to a definition of Clusters of Innovation (COI) to include environments that ‘favor the creation and development of high potential entrepreneurial ventures’. The authors also agree that these environments can be of the most varied nature and comprise the most diverse ingredients but have in common a core competence: entrepreneurship. It is this understanding that has inspired this chapter. Were it not for entrepreneurship, how could such an adverse institutional environment as China’s have allowed the rebirth of private companies, their survival, and their swift expansion? China has experienced an astounding burst of growth of private enterprises since the opening up of the economy in 1978. According to a 2008 speech ‘Thirty years of development and contribution of the private economy’ pronounced by Quan Zhezhu, Secretary of the Party Committee of All-China Federation of Industry and Commerce, at the Fourth Forum of China’s Private Enterprise Investment and Development, in 2008, thirty years after the beginning of the reforms, tax revenue from non-state-owned enterprises accounted for 61.09 percent of tax revenues and for 70.34 percent of total profit (Quan Zhenzhu, 2008). During that period, jobs created in the private economy made up 80 percent of non-agricultural jobs and 90 percent of all new jobs.
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