Study On The Residual Claim Of Technological Assets In Chinese Enterprises

Since the Chinese economic reform in1978, technological innovation has been highly concerned. In1988, Deng Xiaoping raised the Four main theory with pointed out that technology is the first productivity. In Chinese Communist Party’s18th Congress, it raises that" technological innovation is the supporting strategy to increase social productivity and comprehensive national strength, and it needs to be put in the most important place". During2013, in9th study of Politburo which titled as driving innovation as developing strategy, Chairmen Xi Jinping pointed out that letting innovation driving developing strategy determines our country’s destiny. So the whole Party and society should fully understand the importance of technological innovation, clearly handle the develop strategy of world’s technological innovation, tightly hold and carefully use the opportunity of technology revolution and industry change and carefully treat innovation driving development as an important future plan.Although China has fruity acquisitions in technological innovation area, it’s a long way to go if we need innovation drive developing strategy. The technological innovation ability of our country’s enterprises is still weak, some important industry’s key technique and product still rely on import while large amount of scientific research result can’s turn into production. The original innovation ability is extremely weak and key technology needs to get from other people or country. There’s only small amount of innovation driving enterprises and it’s hard to change economic developing way.Facing the problem of lacking technological innovation ability, we used to treat it as the must consequences of having far less capital, talent, modern equipment and advanced compute ability than we need. However, in recent year government has increase the amount input in technological innovation. In2011, the total expense in technological innovation has reached490.26billion, which is40.5times as1988’s. In past six years, expense on technology on GDP share percentage has increased20%. Since1999, China’s graduates in science has raised and in2011. In2011,personnel FTE has reached2.88million person per year, which is4.2times of that in1992. On the same time, we have adequate equipment. Now China has some modernist laboratory with most advanced equipment, capital, talent and scientific research equipment. Facing this kind of situation, we need to think deep on the main reason that limited Chinese enterprises to rise their technological innovation ability.In this article, I argue that the main hinders that limited our country’s technological innovation are some shortcomings in nowadays microeconomic institution. These shortcomings are:1. Science research contract lack the incentive of industrialization and technical shareholder.2. Technical asset’s property right now is based on the principle that the people who invest in the project can own the benefit. This has less incentive on inventors.3. If the policy can’t support technological based SMEs’born and growth, innovation source will stay in hard situation.4. Lacking of efficient exiting ways will limit the use of venture capital system. These disadvantages on institution are mainly because of the lack of institution on letting technological innovation groups have the residual claim on technical asset. In the era of knowledge economic, innovation source has already surpass the capital as the most important and rarest economic source. When pushing the growth of innovation source, we need to study from developed countries’experiences.1. The contract should has clear industrialization intension and has institution on letting technological group has shareholding.2. The property right on technical asset should be occupied by people who invent it.3. Building an environment that SMEs can growth properly.4. Building mature and completed system of venture capital. All these experiences are based on the efficient institution that gives residual claim of technical asset to technological innovation groups. Based on different institution, the groups will be filled with energy on technological innovation or just lazy and become free-riders.This article analyses the residual claim of technical asset in technological innovation institution from contract, property right, enterprises’organization and social economic organization aspects. The essay using the technical asset’s value changing model to analyses the impact of key entry in contract on technical asset’s residual claim and get the option model for technological innovation group’s benefit. Also, by using gold model, I analyses dissipation of rent problem and research on the effect on residual claim by changing the definition, protection and transportation of property right. By using mode of governance mode, I analyses technological innovation’s organization problem, raise the antinomy of residual claim and reach the conclusion that SMEs are the proper enterprises’organize form for knowledge economic developing. Also I analyses the form of venture capital institution system, research on residual claim on technical asset in venture capital and impact on technological innovation and reach the point that venture capital is the most proper way to fit knowledge economic development. This article puts stylized fact on contract problem of research institution inside country, by comparing Silicon Valley and128highways development, I show residual claim of technical asset can be an encourage. And the article shows the disadvantages of technological innovation institution in our country by studying developed countries’experiences on driving innovation. The article raise that the way to complete our country’s technological innovation institutions should be letting technological innovation group has the residual claim of technical asset. To fulfill this purpose, our country should change the microeconomic policies from property right, contract, enterprises’ organization and social economic organization aspect and in the end develop companies’ technological innovation ability. In the end, I also give out some advices on policy on contract, technological asset’s property right, SMEs development and complete venture capital system.This essay is divided into eight chapters, which mainly contents following parts:Chapter one is introduction. In this chapter, I introduce the background of choosing the topic and main use value for my research. Major points inside China toward residual claim, technologically innovational institution for enterprises and the residual claim of technical asset have been collected and introduced. This chapter also includes this essay’s major analyses techniques, introduce paragraph structure and discusses the innovations and deficiencies.Chapter two introduces the theory of technical asset’s residual claim. This chapter analyses residual claim problem from contract, property right and enterprises’organize sides and discuss technical innovational institution problem from risky investment and technical asset sides. Based on these analyses, the theory of technical asset’s residual claim is raised. By analyses the factors of technical asset, I discuss technical asset’s residual claim and residual right of control in enterprises.Chapter three is the search on the theory of residual claim on technical asset. In this chapter, I start with the impact on the existence and growth of innovation source deal with residual claim of technical asset. This article using the model of the change in value of technical assets, analyses the impact to residual claim on technical asset deal with main entry of scientific research contract and therefore know the option model of technological innovation groups benefit. This article using gold model, analyses technical assets’rent diminish problem and its impact on residual claim of technical asset deal with property right’s definite, protect and transport. Also, the article use the mode of government mode on technological innovation group’s organization problem and raise the antinomy of residual claim to show that SMEs fit the development of knowledge economic best. In the end, the article analyses the form of venture capital institution and analyses the residual claim problem on technical asset and the impact on technological innovation, therefore raise the conclusion that venture capital is the fittest institution for development of knowledge economic.Chapter four is the research on stylized fact of the residual claim of technical asset and technological innovation ability. Though compare the effect of main entry in science research contract in real world, Silicon Valley and128highways development, I show the availability of the theory of residual claim of technical asset. Chapter five analyses the disadvantages of China’s microeconomic policies in technological innovation of enterprises based on the residual claim of technical asset. This chapter view innovation from the height of driving developing strategy and our country’s aim for enterprises and analyses the nowadays situations of our country’s innovation ability. Based on the analyses, I raise the point that microeconomic policies’disadvantages is the main hinder to limited the development of our country’s technological innovation ability, while analyzing main disadvantages from venture capital, technical asset’s property right,scientific research contract and develop innovation source.Chapter six shows the reflection on developed countries’institution on innovation on the aspect of the residual claim of technical asset. In this chapter, I briefly reflect developed countries course on knowledge of economic and raise the point that innovation source is the most important can rarest resources in the era of knowledge of economic. In the meantime, I analyses the situation when innovation source instead of capital become the most important resources, organization of enterprises in developed countries change from large, shareholding companies to small, scientific based companies. Also, I analyses the demand when developed countries’enterprises trying to transformed and fit knowledge economic development which is mainly falls into venture capital, technical asset’s property right and research contract area with successful examples.Chapter seven is the advices to develop our country’s technological innovation polices. In this chapter, I conclude the major disadvantages in microeconomic policies that limited technological innovation and raise the point that the main road for China’s technological innovation institution is to let technological innovation group has the residual claim of technical asset. In order to reach this purpose, our country should change the microeconomic policies from property right, contract, enterprises’organization and social economic organization aspect and in the end develop companies’technological innovation ability. In the end, advices are given in science research contract, technical asset’s property institution, improve SMEs development and complete the venture capital policy system aspects.The last chapter includes the conclusion and looking-forwards.The main conclusions for this essay are:1. While creating and using technical asset, each factor provider has its own limited rational problem. They can’t get all the information related to technical asset as well as analyses its future value. In the meantime, there’s severe asymmetric information problem between factor providers. Those groups which have the ability to achieve technological innovation have advantages in knowing more information as well as more selections, so it’s not easy to be discovered if they take opportunistic behaviors. It will be much clearer in analyzing how to efficiently encourage those factors technological innovations, which is always known as technological innovation group, if we analyses residual claim for technical asset first.2. Though analyses the model of option, when the technological innovation groups have the residual claim, the group’s and research investors’expect income is change in same direction. Therefore they have share same benefit and can create technical assets with more economic value.3. From technological asset’s property institution aspect, the principle of "the people who invent can occupy the right of using" can effectively increase the quantity and quality of government assisting technological research project and raise the level of university and technological researching institution. Though establish the law, justice and administration ways to build complete and high-efficiency system to protect property right of technical asset and avoid rent diminishing problem, moreover, this can protect the benefit and activeness of technological innovation group. By forming system to support technical asset’s property right’s transport, it can finally realize the value of technical asset and provide energy to innovation activity.4. In this article, we define the antinomy of residual claim as the situation that negative encourage occurs when giving technological innovation group residual claim in enterprises. If the Small and Middle enterprises (SMEs) can avoid the happen of antinomy of residual claim, they will have the most efficient enterprises’ organization ways to develop innovation source.5. In industrialization period, share-holding system, as an institution system, can release encourage and limit to managers and gather large social capital for industrial production. While in the era of knowledge economic, large amount of science based SMEs become the main force of technological innovation and economic development, and venture capital institution becomes the most suitable one among institutions.6. The venture capital has efficient institutions on exit, encourage, organization form, risk share, technical asset maintain and government policy’s assistance. Therefore, it can form a completed system of venture capital and support technological innovation.7. In this article I also found out the key entry in technical research contract to assist technological innovation activity. First, for the examine principle in research contract, using industrial realization as one of the principle will help to ensure industrial direction and increase the efficiency of technological innovation activity. Second, when dealing with the wage model, ways such as giving feedback on sales, sharing the revenue after the selling of technical asset and announce share to technical asset will be much better than ordinary fixed wage model in giving incentive to technological innovation group and can push the group to increase the value of their technical asset. Third, when technological innovation group holding shares, the group on the one hand will have the residual claim, on the other hand, they share the residual right of control. This will push the technological innovation activity in most efficient way and can increase the value of technical asset.8. In this article I believe that in the era of knowledge of economic, since technological innovation is the most important production factor, it’s very important to let technological innovation group has residual claim and residual right of control. Many case show that factors such as SMEs, net structure and simple management can assist more innovation groups fit the form with residual claim. This will do help the creation, raise and growth of innovation source and in the end lead to the exist of technological innovation enterprises which are more competitive in market.9. In the article, I believe that the main hinder in developing Chinese’s enterprises’ technological innovation ability is the lack of proper institution in the system, which is especially poor in designing property right, contract, enterprises’ organization and social economic organization parts. For example, venture capital institutions hadn’t been the source of technological innovation, while the property right institutions in technical asset can’t prevent the risk of having rent dissipation problem. Also, we are lacking of leading to industrialization and encourage system in contract area. Last, the organizations of enterprises are not good to innovation source’s born and growth.10. In this article, I treat innovation source as people, research groups or enterprises who can create whole-new ideas and translate those into technical asset and moreover into reality. The main abilities of innovation source are those new ideas. In the era of knowledge economy, the ability of technological innovation has surpass the importance capital can become the most important produce factor. Therefore, innovation source has become the most important and rarest resource in this era.11. In this article, I raise the main road for China’s technological innovation institution is to let technological innovation group has the residual claim of technical asset. In order to reach this purpose, our country should change the microeconomic policies from property right, contract, enterprises’ organization and social economic organization aspect and in the end develop companies’ technological innovation ability.