Innovation and entrepreneurship in China

China has recently started a rapid transition to a new economic development phase which is based on high-tech production and national breakthrough technologies. The reason for this transformation of the innovation strategy lies in scaling innovative system by involving small and medium-sized enterprises (SME). The Government addresses business angels and private venture capital funds to finance SMEs. The aim of the study is to identify and assess changes in the innovative entrepreneurial sector of China's economy, and also analyze the impact of these changes on the dynamics of innovative entrepreneurship activity in the country. The methodical basis of the article were the dialectical and systematic approaches to the study of economic processes, based on the use of methods of comparison and classification. The analysis showed that in total, by 2016, the Chinese Government makes all-out effort to stimulate mass innovation entrepreneurship. The result of such significant support was not only large-scale inclusion of small and medium-sized businesses in R&D activities, but also the development of new innovative structures that led to certain changes in the landscape of China's NIS. The research helped to expose both the existing problems of regional innovation inequality and general trends in innovative entrepreneurship in China. © 2008 International Strategic Management Association. All rights reserved.