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Jin Chen

Empowering innovation

Associate Professor in Entrepreneurship and Innovation


Can you explain your research?

My research focuses on the interface between public and private interaction in the context of innovation and entrepreneurship. I am particularly interested in the impact of government venture capitalists (GVCs) and governmental subsidies on the growth of technology start-ups, as well as exploring the most effective model for GVCs and private venture capitalists (PVCs) to work in synergy in driving innovation and economic development.


What challenges is your research hoping to tackle?

China has a number of policies in place to support the development of technology start-ups, among which government subsidies and GVCs are two important means of financial support.

Before 2014, government subsidy was a common way to support the growth of entrepreneurial businesses. However, the effectiveness of subsidies is often difficult to measure.  A part of my research explores the substantive or treatment effect of how government subsidies affect start-ups as well as the symbolic or signaling role of government subsidies in influencing external investors’ valuation of start-ups.

Since the government started replacing subsidies with equity investments in 2014, the presence of GVCs in China has grown rapidly to bridge the equity gap faced by start-ups. GVC refers to the venture capital funds that are set up or financed by government entities. Different from PVCs, GVCs may follow the state logic and therefore have their own criteria to make investment decisions. For example, GVCs tend to fund sectors which PVCs are less interested in but have great importance to economic development and the society at large.

GVC is an emerging means of public resource allocation that is growing rapidly both in and outside of China. Many novel and interesting forms of public-private interactions have emerged in this context, and have challenged our current understandings and theories about how public and private sectors could complement. For example, how do GVCs strike a balance between state logic and market logic? How do their portfolio ventures react? How could GVCs work with PVCs and ventures to better stimulate entrepreneurship and innovation? My research also answers these questions.

In addition, my research also explores effective public resource allocation methods to stimulate innovation in key industries that are critical to the country’s economic wellbeing.

discussion jin chen
Dr Jin Chen is having a discussion with fellow researchers


What specific projects are you conducting?

In our research, we found that although China has become the second largest VC market in the world, we still lack high-quality datasets on domestic VC affiliations. To fill up this gap and to enable GVC research in China’s context, we first compiled a new dataset for over 6,000 domestic VCs, and developed a multi-stage procedure to label each VC as GVC, professional VC, corporate VC, among others.

This dataset is currently under review at Scientific Data, a journal published by Nature, and once approved, it will be made available to scholars worldwide free of charge for research purpose.

I believe the dataset could help researchers conduct more nuanced investigations into the investment behaviours of different VCs and their distinct impacts on innovation and entrepreneurship in China’s context.

Regarding the signaling effect of government subsidies, we published a paper in Research Policy in 2018 discussing the impact of R&D and non-R&D subsidies on the IPO performance of China’s technology start-ups. It was among the first to clarify the signaling effects of different types of government subsidies.

Another paper on GVC’s signaling effect has just been accepted by the Quarterly Journal of Management, a top Chinese journal in the field of strategy. This study examines how and why the investment decision of GVCs could be affected by start-ups’ patent signals (i.e., patent amount, patent diversity, and patent innovativeness).

In 2020, NUBS’ Research Base on Dual Circulation and Economic Development was approved as a Ningbo Social Science Research Base. I will lead a project under this research base and focus on GVCs and startup incubation, in order to provide policy advice to boost entrepreneurship and innovation in Ningbo.


Where would you like to take your research next?

Despite the tremendous growth of GVCs, there are still many challenges causing inefficient resource allocations in this context. I hope that more scholars will join in this meaningful research agenda of GVCs in China to generate new theoretical lenses that are contextualised to emerging economies and provide policy advice to better support entrepreneurial businesses.

The interaction among public capital, private capital, and ventures essentially reflects a theoretical question – the tension between value creation and value appropriation in public-private collaborations. Insights into this theoretical question can not only guide the allocation of public resources, but the allocation of various types of quasi-public resources, like platforms. I will continue the research on this theoretical topic, and I believe it will have broad applications in the future.


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