From Home-Country to Host-Country: The Rise of Emerging Economies in Multinational R&D Networks and Its Impact on the Global Innovation Landscape
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About the talk
Emerging economies such as China and India have become “hotspots” of multinational R&D investments. As some observers have argued, some unique products/services are first developed in and for emerging markets, then subsequently introduced to advanced markets. This is named “reverse innovation” and proclaimed to bring great challenges for existing industrial dominators (Immelt, Govindarajan & Trimble, 2009). If true, what would be its impact on multinational global R&D strategies and organizations? What kind of capabilities and mechanism should be developed to respond this change?
Based on case studies in China, Dr. Liang will discuss three new types of multinationals’ R&D units abroad. All of them are host-country-based instead of home-country-based, which indicates the latest change of multinational global R&D distribution. Furthermore, the talk will also explore the global R&D strategy and innovation pattern of Chinese home-grown companies such as Huawei and ZTE, and the relationship between multinationals’ R&D relocation in China, as well as their implications on global innovation landscape.
About the speaker
Dr. LIANG Zheng is currently working at the MIT Industrial Performance Center (IPC) as the Fulbright Visiting Research Scholar. Presently he is carrying out research projects on multinationals’ global R&D network expansion and integration, as well as the internationalization of new industrial leaders from emerging economies. He serves as the associate professor of the School of Public Policy and Management, Tsinghua University, as well as the research fellow and assistant director of China Institute for Science & Technology Policy at Tsinghua University (CISTP), which is jointly established by Ministry of Science and Technology of China and Tsinghua University, mainly focusing on the studies of S&T policy and the national strategy of S&T development. Before joining Tsinghua University, Dr. Liang served as the associate professor of the International Business School in Nankai University. He got his doctor’s degree of economics at Nankai University (2003) and accomplished the senior executive training program on leadership at Kennedy School of Government, Harvard University (2010). The main areas of his research focus on globalization of R&D, IPRs and standardization and the National Innovation System. Dr. Liang has also participated in some of China’s key research projects such as the Strategic Research for National Medium and Long Term Science and Technology Development Program.
E103, Faculty Building East, Knight Management Center, Stanford Graduate School of Business, 655 Knight Way, Stanford, CA 94305-7298
LIANG, Zheng
Associate Professor, School of Public Policy and Management
Speaker
Tsinghua University
Henry S. Rowen
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FSI Senior Fellow Emeritus and Director-Emeritus, Shorenstein APARC
Henry S. Rowen was a senior fellow at the Hoover Institution, a professor of public policy and management emeritus at Stanford University's Graduate School of Business, and a senior fellow emeritus of the Walter H. Shorenstein Asia-Pacific Research Center (Shorenstein APARC). Rowen was an expert on international security, economic development, and high tech industries in the United States and Asia. His most current research focused on the rise of Asia in high technologies.
In 2004 and 2005, Rowen served on the Presidential Commission on the Intelligence of the United States Regarding Weapons of Mass Destruction. From 2001 to 2004, he served on the Secretary of Defense Policy Advisory Board. Rowen was assistant secretary of defense for international security affairs in the U.S. Department of Defense from 1989 to 1991. He was also chairman of the National Intelligence Council from 1981 to 1983. Rowen served as president of the RAND Corporation from 1967 to 1972, and was assistant director of the U.S. Bureau of the Budget from 1965 to 1966.
Rowen most recently co-edited Greater China's Quest for Innovation (Shorenstein APARC, 2008). He also co-edited Making IT: The Rise of Asia in High Tech (Stanford University Press, 2006) and The Silicon Valley Edge: A Habitat for Innovation and Entrepreneurship (2000). Rowen's other books include Prospects for Peace in South Asia (edited with Rafiq Dossani) and Behind East Asian Growth: The Political and Social Foundations of Prosperity (1998). Among his articles are "The Short March: China's Road to Democracy," in National Interest (1996); "Inchon in the Desert: My Rejected Plan," in National Interest (1995); and "The Tide underneath the 'Third Wave,'" in Journal of Democracy (1995).
Born in Boston in 1925, Rowen earned a bachelors degree in industrial management from the Massachusetts Institute of Technology in 1949 and a masters in economics from Oxford University in 1955.
Faculty Co-director Emeritus, SPRIE
Senior Fellow, Hoover Institution
Seminars
Comment by Karl Eikenberry on "Keeping NATO Relevant"
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Jamie Shea's essay "Keeping NATO Relevant" appearing in the Carnegie Endowment for International Peace April 2012 edition of Policy Outlook offers a comprehensive, thoughtful, and - given the 20-21 May NATO Summit in Chicago - timely discussion of the Alliance's future.
Shea, currently the Deputy Assistant Secretary General for Emerging Security Challenges, is one of the most experienced and articulate senior officials assigned to the NATO International Staff.
During my own posting to NATO Headquarters in Brussels from 2007 to 2009, I was consistently impressed with Shea’s ability to make clear the Alliance’s strategic vulnerabilities and opportunities. He has done this in spades in “Keeping NATO Relevant.”
As the NATO mission in Afghanistan transitions from one of large scale combat to that of limited training assistance, Alliance leaders must look to the future and better define the organization's purpose. The author identifies and covers the relevant issues well - threat assessment, tasks, required capabilities, degree of reliance on the United States, and the role of partnerships between NATO and other countries.
A fiscally constrained United States will need to rely on its alliance partners even more in the post- Iraq and Afghanistan era. Foremost among these alliances is NATO. I commend Jamie Shea's article to those interested in better understanding its limitations and potential.
Karl Eikenberry is the Freeman Spogli Institute for International Studies Institute Payne Distinguished Lecturer and research affiliate at The European Center . He was the Deputy Chairman of the NATO Military Committee from 2007 to 2009.
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Bo Xilai affair a turning point for China's top leadership
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A revelatory story emerged in China this spring: Bo Xilai, Chongqing’s powerful Communist Party head, was stripped of both his post and party membership and accused of shocking abuses of power, including covering up his wife’s alleged involvement in the death of a shadowy British businessman.
On May 2, the Shorenstein Asia-Pacific Research Center held a special seminar to make sense of what this unusual high-level scandal could mean for the future of China’s current political system, erupting just months ahead of a once-in-a-generation leadership transition.
Minxin Pei, director of the Keck Center for International and Strategic Studies at Claremont McKenna College, said the scandal is a severe test for the Chinese Communist Party (CCP), which balances on a knife’s edge as it prepares to replace the majority of its Politburo members—the highest CCP echelon. The Bo affair has exposed the existence of serious corruption at a very high level of government, calling into question the party’s image and credibility.
“This is the biggest threat to party unity since 1989,” he said.
More potentially damaging still, however, is the negative light it has cast on China’s overall political system. The scandal has revealed weaknesses and loopholes in the power structure, and the government’s poor crisis management skills.
“The Bo Xilai affair is the beginning of the end of the Tiananmen era,” Pei said. “Twenty years from now, historians will make this point.”
Xueguang Zhou, a professor of sociology and Freeman Spogli Institute senior fellow, agreed with Pei’s analysis that Bo’s fall from power has tarnished the party’s image and deeply disrupted the cohesiveness of its upper leadership.He spoke also of the outpouring of criticism on social media sites for the government’s inability to reign in corruption—so much so that censors have not been able to keep up.
“These voices have been so fierce in criticizing the top leadership that it has huge implications for the emergence of China’s civil society,” Zhou said.
He expressed his concern for the future of local politics after the smoke from the Bo affair has cleared. Although it is widely acknowledged in China that shady political dealings go hand-in-hand with local-level politics, positive innovations in governance also frequently occur at the city and county level.
“I hope that local governments will still have the power to experiment,” he said.
After all is said and done, China’s top leadership is at a major turning point. Only time will tell the full impact of the fall of Bo Xilai, both during this year’s power transition and the evolution of China’s government structure in the coming decades.
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A rain-spattered window and misty bridge in Chongqing, October 2011, one month before the death of British businessman Neil Heywood.
Flickr/International Hydropower Association; http://bit.ly/J8JSoh
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Defending Critical Infrastructure Systems
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Sponsored by
The Preventive Defense Project and the
CISAC Science Seminar Series
Roughly 85% of the critical infrastructure systems in the United States is owned or operated by the private sector. Managers of these systems must keep everything running and try to ensure nothing bad happens, despite increasing system complexity and demand for continuing improvements in efficiency. This challenge naturally leads to the questions “which parts of an infrastructure are critical,” “how critical are they,” and “how should we invest limited budget to defend our infrastructure?”
We introduce two- and three-stage optimization models that represent the strategic, game-theoretic interactions between preparations to defend critical infrastructure, an “attacker” who observes these preparations before acting, and a “defender” who operates the surviving infrastructure as best as possible after an optimal attack. We identify worst-case disruptions in the operation of a system by solving a system interdiction problem. Then, given an available budget and list of possible defensive investments (e.g., hardening, redundancy, capacity expansion), we solve for a combination of investments that makes the system maximally resilient to worst-case disruption. We show some unexpected results that have proven insightful.
These models apply equally well to government, military, and commercial systems. Between our NPS student-officers and faculty, we have conducted over 150 case studies on systems ranging from electric power, to transportation, to supply chains, to the Internet.
About the speaker: David L. Alderson, Ph.D, joined the Naval Postgraduate School faculty in 2006 after working for three years as a postdoctoral scholar in the Division of Engineering and Applied Sciences at the California Institute of Technology (Caltech). He received a B.S.E. in Civil Engineering and Operations Research from Princeton University and the M.S. and Ph.D. degrees from the Department of Management Science and Engineering at Stanford University. His research focuses on the function and operation of critical infrastructures, with particular emphasis on how to invest limited resources to ensure efficient and resilient performance in the face of accidents, failures, natural disasters, or deliberate attacks. He currently serves as the Director of the NPS Center for Infrastructure Defense (CID). As part of a Multiple University Research Initiative (MURI) team studying "Next-Generation Network Science," he studies tradeoffs between efficiency, complexity, and fragility in a wide variety of public and private network-centric systems. He has extensive experience working on the Internet and other complex communication networks, having been a researcher at the Xerox Palo Alto Research Center (PARC), the Santa Fe Institute (SFI), and the Institute for Pure and Applied Mathematics (IPAM) at UCLA. He is a member of INFORMS and MORS.
CISAC Conference Room
Dave Alderson
Assistant Professor, Operations Research Department Director, Center for Infrastructure Defense, Naval Postgraduate School
Speaker
Seminars
Stanford study shows no evidence that international health aid is wasted
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Retraction:
In June 2012, Stanford researchers Rajaie Batniji and Eran Bendavid retracted the research findings explained in the following article.
Their findings, presented in the essay, "Does development assistance for health really displace government health spending? Reassessing the evidence," contained errors in statistical model choice and reporting. The essay was published May 8, 2012, by the journal PLoS Medicine.
The researchers erroneously concluded that there was no significant displacement of foreign aid. When they discovered their mistake, they informed editors at PLoS Medicine and moved to correct the record. The editors agreed with the need for the retraction and accepted the authors’ explanation of their error. The retraction can be read at www.plosmedicine.org/article/info%3Adoi%2F10.1371%2Fjournal.pmed.1001214.
When a 2010 study concluded that about half the money given to international governments for providing health care services isn’t used as intended, skeptics who argued that foreign aid is largely wasted were handed a powerful piece of data to bolster their claims.
But Stanford researchers Rajaie S. Batniji and Eran Bendavid say those findings are flawed. In an article featured in the May 8th edition of PLoS Medicine, Batniji and Bendavid say the two-year-old study by researchers at the University of Washington should not be used to guide decisions about how much money to give and who should get it.
“We can’t say that there’s absolutely no displacement of foreign aid, but these earlier findings are too tenuous for the basis of policy,” said Batniji, an affiliate of the Center on Democracy, Development, and the Rule of Law at the Freeman Spogli Institute for International Studies.
Batniji and Bendavid, an affiliate of FSI’s Stanford Health Policy and an assistant professor of medicine, are taking on the 2010 study – which appeared in the Lancet – at a critical time for foreign assistance programs.
The United States, which gives about half of all the world’s health aid, plans to chop its $10 billion budget by about 4 percent in the coming fiscal year. That’s the first cut in more than a decade. And officials have shown no signs of switching their preference of bypassing national governments as recipients of health aid, funneling more than half of U.S. support to non-governmental organizations instead.
Batniji and Bendavid decided to re-analyze the data used by the University of Washington researchers after meeting with policymakers who pointed to the study as a cautionary tale of foreign governments that waste and mismanage money earmarked for health programs.
“People were citing the Lancet piece, saying this was starting to shape how they thought about giving money,” said Batniji, who is also a resident physician at Stanford Medical Center. “But when we started asking questions about what the actual displacement looks like, the answers didn’t seem very compelling or reasonable.”
Taking a fresh look at the same numbers used for the 2010 study – public financing data culled from the World Health Organization and the International Monetary Fund – the researchers saw a different story emerge about the use of foreign aid in the health sector.
Once Batniji and Bendavid excluded conflicting and outlying data, such as huge discrepancies between WHO and IMF estimates and information about countries that were getting very small amounts of money from other countries, “there was no significant displacement of foreign aid,” Bendavid said.
The Stanford researchers’ findings are poised to influence a debate among policymakers and donors over whether it’s more efficient to give international assistance slated for health spending to government agencies or NGOs.
“We want to free donors of feeling that if they give money directly to governments, the money will be offset and used for an unintended purpose,” Batniji said. “The concern about displacement really amplifies the demands we make on governments for how they use the money. And that is at odds with a recent movement to let foreign governments set their own agendas for how to spend money.”
The research conducted by Batniji and Bendavid was supported by FSI’s Global Underdevelopment Action Fund and the Dr. George Rosenkranz Prize awarded to Bendavid in 2010.
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Taiwan’s Maturing Democracy
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On May 14, the Center for Northeast Asian Policy Studies (CNAPS) at Brookings and the Center on Democracy, Development, and the Rule of Law (CDDRL) at Stanford University hosted a seminar analyzing progress and challenges in the consolidation of Taiwan’s democratization and reforms. While the presidential and legislative elections held on January 14 were interpreted by many as proof that Taiwan’s democratic system—including its government and society—has matured since the first transition of political power in 2000, both big-picture and day-to-day challenges to effective democratic governance remain.
The seminar featured leading practitioners and political scientists from Taiwan and the United States. Panelists examined reforms that have been enacted in Taiwan over the past decade, and analyzed their impact on the functions of government agencies, political parties, and other non-governmental organizations. They also discussed how reform and consolidation are affecting policy and public perception of the system.
Participants
9:00 AM — Panel 1: Government
David Brown, Adjunct Professor, Paul H, Nitze School of Advanced International Studies, Johns Hopkins University
Nigel N.T. Li, Adjunct Professor, Graduate School of Law, Soochow University
Adjunct Professor, Graduate Institute of Political Science, National Taiwan University
Da-Chi Liao, Professor of Political Science, National Sun Yat-sen University
Jiunn-rong Yeh, Professor, College of Law, National Taiwan University
11:00 AM — Panel 2: Politics and Society
John Fuh-sheng Hsieh, Professor of Political Science, University of South Carolina
Shelley Rigger, Brown Professor of East Asian Politics Chair, Department of Political Science, Davidson College
Erich Che-wei Shih, News Anchor and Senior Producer, CTi Television
Eric Chen-hua Yu, Assistant Professor of Political Science, National Chengchi University
12:45 PM — Lunch
1:45 PM — Panel 3: Implications of Democratic Consolidation
Richard C. Bush III, Director, Center for Northeast Asian Policy Studies
Larry Diamond, Professor of Political Science; Director, Center on Democracy, Development, and the Rule of Law, Stanford University
Alan Romberg, Distinguished Fellow and Director, East Asia Program, The Stimson Center
Ho Szu-yin, Professor, Department of Political Science, National Chengchi University
Audio recordings of the event are available online at the Brookings website here:
Falk Auditorium,
The Brookings Institution,
1775 Massachusetts Ave.,NW
Washington, DC
Larry Diamond
CDDRL
Stanford University
Encina Hall, C147
616 Jane Stanford Way
Stanford, CA 94305-6055
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ldiamond@stanford.edu
Mosbacher Senior Fellow in Global Democracy at the Freeman Spogli Institute for International Studies
William L. Clayton Senior Fellow at the Hoover Institution
Professor, by courtesy, of Political Science and Sociology
Larry Diamond is the William L. Clayton Senior Fellow at the Hoover Institution, the Mosbacher Senior Fellow in Global Democracy at the Freeman Spogli Institute for International Studies (FSI), and a Bass University Fellow in Undergraduate Education at Stanford University. He is also professor by courtesy of Political Science and Sociology at Stanford, where he lectures and teaches courses on democracy (including an online course on EdX). At the Hoover Institution, he co-leads the Project on Taiwan in the Indo-Pacific Region and participates in the Project on the U.S., China, and the World. At FSI, he is among the core faculty of the Center on Democracy, Development and the Rule of Law, which he directed for six and a half years. He leads FSI’s Israel Studies Program and is a member of the Program on Arab Reform and Development. He also co-leads the Global Digital Policy Incubator, based at FSI’s Cyber Policy Center. He served for 32 years as founding co-editor of the Journal of Democracy.
Diamond’s research focuses on global trends affecting freedom and democracy and on U.S. and international policies to defend and advance democracy. His book, Ill Winds: Saving Democracy from Russian Rage, Chinese Ambition, and American Complacency, analyzes the challenges confronting liberal democracy in the United States and around the world at this potential “hinge in history,” and offers an agenda for strengthening and defending democracy at home and abroad. A paperback edition with a new preface was released by Penguin in April 2020. His other books include: In Search of Democracy (2016), The Spirit of Democracy (2008), Developing Democracy: Toward Consolidation (1999), Promoting Democracy in the 1990s (1995), and Class, Ethnicity, and Democracy in Nigeria (1989). He has edited or coedited more than fifty books, including China’s Influence and American Interests (2019, with Orville Schell), Silicon Triangle: The United States, China, Taiwan the Global Semiconductor Security (2023, with James O. Ellis Jr. and Orville Schell), and The Troubling State of India’s Democracy (2024, with Sumit Ganguly and Dinsha Mistree).
During 2002–03, Diamond served as a consultant to the US Agency for International Development (USAID) and was a contributing author of its report, Foreign Aid in the National Interest. He has advised and lectured to universities and think tanks around the world, and to the World Bank, the United Nations, the State Department, and other organizations dealing with governance and development. During the first three months of 2004, Diamond served as a senior adviser on governance to the Coalition Provisional Authority in Baghdad. His 2005 book, Squandered Victory: The American Occupation and the Bungled Effort to Bring Democracy to Iraq, was one of the first books to critically analyze America's postwar engagement in Iraq.
Among Diamond’s other edited books are Democracy in Decline?; Democratization and Authoritarianism in the Arab World; Will China Democratize?; and Liberation Technology: Social Media and the Struggle for Democracy, all edited with Marc F. Plattner; and Politics and Culture in Contemporary Iran, with Abbas Milani. With Juan J. Linz and Seymour Martin Lipset, he edited the series, Democracy in Developing Countries, which helped to shape a new generation of comparative study of democratic development.
Download full-resolution headshot; photo credit: Rod Searcey.
Former Director of the Center on Democracy, Development and the Rule of Law
Faculty Chair, Jan Koum Israel Studies Program
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