VoxDev Development Economics S7 Ep13: Ideas in Development: Josh Lerner on the diffusion of technology
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Mar 18, 2026 Josh Lerner, Harvard Business School professor who studies venture capital and tech diffusion, discusses why innovation clusters around suppliers, universities and investors. He explores measuring diffusion via job data and what past patterns imply for AI. He also examines China’s rapid rise as a tech hub and how localized AI applications and policy levers can speed spread.
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China Erupted Into A Global Venture Hub
- Lerner traces China’s venture boom from near-zero share in 2001 to parity with the US by about 2019.
- He highlights business-model innovation tailored to Chinese contexts, not just copying US firms.
Role Models From China Spark Global Entrepreneurship
- China's hub role stimulated entrepreneurship in other emerging economies via example and role models rather than primarily direct Chinese investment.
- Lerner gives cases: internships in China and VCs in Singapore acting as translators for business models.
Remove Structural Barriers Before Funding Startups
- Don't just throw money at VC; first remove structural barriers like tech transfer rules, labor rigidity and business registration hurdles.
- Lerner contrasts Japan's money-heavy 1990s programs that failed once state support receded.