The Process of C hinese Manufacturing Upgrading: Transitioning from Unilateral to Recursive Mutual Learning Relations

This article argues that upgrading in C hina has been a historical success, that upgrading must be seen as a learning process, and that current C hinese upgrading involves a transformation in industrial learning dynamics. During C hina's initial export‐oriented industrialization strategy, indigenous producers successfully upgraded by apprenticing themselves to their foreign customers, and they learned through integration in transnational communities of practice. The success of those initial unilateral learning relations enhanced the sophistication of the C hinese market, both as a community of producers and as a market for manufactured goods. This has generated a new phase of learning‐driven upgrading in which C hinese producers and MNC manufacturers both seek to make their C hinese operations more sophisticated. In this new context, apprenticeship disappears and C hinese and foreign players learn from one another. A core claim about the new mutual learning is that it is facilitated by the globalization of formal learning systems, such as corporate production systems ( CPSs ).