Chinese AI Innovation Led by Universities

An NBER study by Josh Lerner's team at Harvard Business School, analyzing approximately 14 million Chinese patents, found that China's core technology innovation is driven primarily by universities rather than a few large corporations.

The analysis focused on 14 critical technology areas designated by the US Department of Defense, including AI, advanced computing, space, hypersonics, and biotech.

• Chinese universities were involved in more than 25% of inventions in these fields.
• The share held by universities in the US was 3.3%, roughly one-eighth of China's.
• Chinese state-owned enterprises and the government accounted for only 4%.
• Fewer than 10% of China's core technology patents included inventors with work experience in the US.

The researchers concluded that, contrary to the prevailing view that China's technological innovation relies on large corporations like Huawei and Tencent or talent returning from the US, it is distributed across diverse actors, including universities. In contrast, university patent activity in the US has remained relatively secondary.