[fleshfly]

> ... Jeffrey Towson, professor of investment at the Peking University Guanghua School of Management, adding that the US has no mechanism to support a top-down model.

This...does not seem correct? Many technologies have spillover effects which end up being non-rivalrous and non-excludable. As a result the private sector under-provides key technologies that otherwise are net welfare enhancing. Governments, even those with free markets know this and routinely step in, in the form of top-down subsidies or what have you. In the US, we have DARPA, NIH, SBIR, and numerous other federal laboratories that end up engaging with the private sector on a delegated or cooperative basis.

What am I missing? In China, where patent protection and intellectual property enforcement are not as strong as those in the US, there is an even greater incentive for governments to subsidize R&D.