Public Opinion, Central Decision-making Dominance and Policy Changes: A Case Study of China’s Large Aircraft Industry

Abstract

In 2007, the Chinese government decided to set up a state-owned joint-stock company and started its independent research on large civil aircraft, signalling a shift in strategy for the large civil aircraft industry from “market in exchange for technology”, adopted at the beginning of the “reform and opening up” period, to “independent innovation”. This article shows that changes in public opinion and the central government’s dominance in decision-making have significantly impacted the new policy paradigm. The policy shift from “market in exchange for technology” to “independent innovation” in China’s civil aircraft industry has seen the nation and key stakeholders redefining their own interests and legitimacy through top-down and bottom-up political mobilisation, as they manoeuvre the new governance structure of the industry. In the process of social construction, the government abandoned the logic of “market in exchange for technology” and promoted the development strategy to build competitive advantages with the national forces. “Independent innovation” became the mainstream political discourse and evaluation criteria of industrial policy, thereby setting the tone for policy changes in China’s civil aircraft industry and direction of further development. With the help of public opinion and external experts, early developers of large aircraft, which were already marginalised during the “market in exchange for technology” phase, criticised this policy with regard to three aspects—the goal of the policy, policy logic and executive authority—thereby reconstructing the recognition and interests of the stakeholders, thus prompting the State Council to break the shackles of the mainstream aviation system. The State Council later dominated in the decision-making and was directly involved in the production of large civil aircraft industry, completing the process of policy shift.