China’s clean-tech success isn’t entirely because of statist policy


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There’s a comforting but erroneous explanation for why solar panels, home batteries and electric vehicles (EVs) are increasingly likely to be made in China. With an economy awash in easy money, its renewable manufacturers are undercutting rivals across the world; ergo, China’s comparative advantage isn’t scale, cost efficiency or innovative prowess, but cheap government subsidies. In the EV industry “everybody has an endless supply of loans and support from the local government," the Financial Times quoted Jörg Wuttke, former president of the European Union Chamber of Commerce in China, as saying in a recent article. This theory provides a justification...