In the race between innovators and imitators, it is often the imitators who win out. That’s according to Ohio University business professor, Oded Shenkar, in his 2010 book Copycats: How Smart Companies Use Imitation to Gain a Strategic Edge. It applies equally to what Ted C. Fishman once described as “China, Inc.,” as it does to Apple or Samsung. 

Over the last half-century, the People’s Republic of China (PRC) has transformed from an agrarian nation under a personalist dictatorship—in effect a large-scale North Korea—to the second-largest economy in gross domestic product (GDP) terms (and the largest economy in purchasing power parity, or PPP, terms). The transformation is remarkable. The methods it used to catch up to the West are less so.

Part of China’s strength resides in its constantly evolving high-technology sector, borne in large part out of China’s advanced manufacturing capabilities. And while Chinese scientists and engineers are innovative and brilliant people, the Chinese high-tech and manufacturing sectors are only in existence because the United States and the wider West offloaded massive amounts of manufacturing capabilities.

In essence, once China became the world’s sweatshop, it moved up the development ladder, quickly building a high-tech production ecosystem to rival even that of the United States.

Fundamentally, however, the Chinese—like the imitator firms highlighted in Shenkar’s 2010 book mentioned above—have built their entire economy upon slashing onerous development cycles by pilfering and/or copying more advanced, innovative countries and foreign firms. As Taiwanese-born venture capitalist Kai-Fu Lee explained in his........

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