Hong Kong Industrial Development in the Innovative Era Stephen Yan-Leung Cheung City University of Hong Kong

Content Hong Kong economic model in the past Knowledge economy? Ways forward

Foundations of Past Successful Stable macro-economic environment Open economy High saving and investment rates Educated work force

Changes Economic Role of China Sources of Growth

Implications for Development Policy Innovations are needed How Hong Kong will cultivate innovations within our economy

Knowledge Assessment Methodology (World Bank) Performance Indicators Economic Incentives and Institutional Regime Education and Human Resources Innovation System Information Infrastructure

Basic Scorecard: Hong Kong (I) Source: World Bank: 2005 Knowledge Assessment Methodology

Basic Scorecard: Hong Kong (II) Source: World Bank: 2005 Knowledge Assessment Methodology

Knowledge Economy Index Source: World Bank: 2004 Knowledge Assessment Methodology

Ingredients Human Capital Investment

Ingredients Human Capital (才) Investment (財)

Human Capital Externally Internally

Capital Inflow Major financing centre for Chinese Enterprises Major driving factor for Pan-Pearl Delta Region

Research and Development Role of Government Role of private sector Role of universities Participation of intellectual property rights Incentives Tax incentives Competition China → Win-win situation

International Evidence on R&D Expenditure Total R&D Expenditure Source: OECD, MSTI.

International Evidence on R&D Expenditure Government Expenditure Source: OECD, MSTI.

International Evidence on R&D Expenditure Private Expenditure Source: OECD, MSTI.

“ People with ideas - people who own ideas - have become more powerful than people who work machines and, in many cases, more powerful than the people who own machines.” The Creative Economy, John Howkins

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