The finding suggests that cutting off access to proprietary American technology does not necessarily stop companies from pursuing innovation. Instead, some affected firms appear to be relying more heavily on academic research, domestic expertise and their own scientific capabilities.
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Researchers from Shenzhen University, Tsinghua University and the University of Hong Kong examined Chinese patent filings and corporate research activity between 2010 and 2022. Their findings, published in the peer-reviewed journal Science, offer a look at how US-China technology tensions are influencing corporate research.
The South China Morning Post reported that the researchers believe sanctions may be encouraging Chinese firms to develop alternatives to foreign technologies while reducing their dependence on the existing global innovation system.
Why Chinese companies are turning to scientific papers
The US Entity List restricts certain companies’ access to American goods, software and technology without government approval. For businesses that rely on overseas suppliers, being added to the list can disrupt established routes to research and development.
But scientific knowledge is not always locked behind the same restrictions.Academic papers can explain the principles behind a technology, describe experiments and provide research that helps engineers explore new solutions. They do not necessarily reveal proprietary designs or the manufacturing expertise required to reproduce a commercial product, but they can offer an important starting point.
According to the South China Morning Post, the study found that sanctioned Chinese firms became more active in using scientific publications in their patents.
Wang Yanbo, associate director of the Centre for Innovation and Entrepreneurship at HKU Business School and a study author, said companies blocked from the US-dominated innovation system may have to develop solutions independently.
“Once they get blocked from this US-dominated global innovation system, they have to reinvent the wheel,” Wang said, as quoted by the South China Morning Post.
He explained that researchers can examine the scientific principles behind a restricted technology and use that knowledge to work towards an alternative.
The finding does not mean sanctions have made Chinese firms independent of foreign technology overnight. It shows that restrictions may be changing where companies look for knowledge.
The 72% increase comes with a significant research gap
The study examined Chinese companies that filed patents domestically and internationally during the 12 years through 2022.
The South China Morning Post reported that placement on the US Entity List was associated with an average 72 per cent surge in science-linked patents citing academic literature.
The researchers also tracked the sources of scientific knowledge used by targeted companies. After sanctioning, firms added an average of 0.99 patents citing domestic science, 0.27 citing non-US foreign science and 0.2 citing US science.
That last figure is important. Although sanctions restrict access to certain US-origin proprietary technologies, publicly available American scientific research can still provide useful information.
The study found that Chinese firms increased their involvement with science both as users and producers of knowledge. They cited more academic research in patents and expanded their own scientific publishing.
However, the South China Morning Post noted that Chinese companies continued to trail US firms in the breadth and depth of scientific research linked to their patents.
In 2022, 37 per cent of US firms’ patents granted by the US Patent and Trademark Office cited scientific literature, compared with 22 per cent for Chinese firms.
Among science-linked patents, American companies cited an average of 17.5 scientific publications. Chinese firms cited five.
The figures show why a rise in patent citations should not be confused with technological parity. Greater use of scientific research may help firms develop new capabilities, but it does not establish that they have matched the research strength of their American competitors.
China’s corporate research output is growing
The patent findings form part of a broader change in the relationship between Chinese companies and scientific research.
According to the South China Morning Post’s report, science-linked patents among Chinese firms grew 13.4-fold over the period examined. US peers recorded a 1.3-fold increase.
Chinese listed companies also expanded their international scientific publishing. Their average annual output rose 6.5 times between 2010 and 2021, reaching four international papers per company in 2021.
US publicly listed companies produced an average of 20 international papers in 2021, up from 12 in 2010.
The comparison points to a growing research presence among Chinese firms, while also showing that American companies remain ahead in average scientific output.
Patents and academic papers measure different parts of innovation. A patent citing scientific literature does not automatically represent a major scientific breakthrough. Similarly, publishing more papers does not guarantee that a company will develop a commercially successful technology.
Still, the South China Morning Post reported that the researchers see the growing connection between corporate science and innovation in China as an important development.
Wang said that if firms invest enough effort and benefit from favourable research results, they may develop technologies that can substitute for restricted American products.
Rare earths and the risk of two technology systems
The technology dispute between Washington and Beijing is not limited to patents or semiconductor equipment.
China’s strength in rare earth mining and processing gives it influence over materials used in advanced manufacturing. Wang pointed to this as another factor in the wider technology struggle, according to the South China Morning Post.
Rare earth elements are used in various industrial applications, including certain high-performance magnets. Finding alternative supply chains or developing substitute technologies can be difficult.
Wang said US policymakers and companies had been working to identify alternative sources and explore magnets that do not rely on rare earth materials.
The issue highlights a broader challenge. Restrictions on technology can encourage companies to seek substitutes, while control over important raw materials can affect the availability and cost of those alternatives.
The researchers warned that continued decoupling could eventually contribute to two separate technological ecosystems: one dominated by the US and another by China.
As reported by the South China Morning Post, Wang questioned whether such fragmentation would benefit the global scientific community.
Competition can support research and commercialisation, he said, but reduced knowledge sharing could make innovation less efficient.
He also noted that China has become one of the world’s leading producers of scientific knowledge. Cooperation with Chinese researchers could therefore continue to benefit American companies and institutions.
The study does not establish that two completely separate technology systems will emerge. It does, however, show that US sanctions are influencing how Chinese firms access scientific knowledge and develop internal capabilities.
For companies facing restrictions on foreign technology, academic research is becoming an increasingly important part of that effort.
