In substance, there are precedents to China's innovation efforts, starting with Japan and the Asian "tiger economies". But in scale, there are none. China's effort is thus historical.

In his memoirs, From Third World to First, Lee Kuan Yew, former Singapore prime minister who died recently, recalls how the tiny city-state managed to leapfrog from being a colonial backwater to an advanced world-class economy from 1965 to 2000. Today, Singapore has 5.3 million people. Despite its population of 1.37 billion, China hopes to achieve the same in one generation. The potential spillover effects are of an entirely different magnitude.

If the current rates of R&D investment and economic growth are any indicator, China is likely to surpass Europe in total spending on R&D by the late 2010s and the US by 2020.

China has now chosen a development path that underscores investment in innovation. But the context of innovation-led development in China will remain different from that in the West. In large emerging economies, such as China, living standards are far lower than in advanced economies. Consequently, the purpose of innovation, through "popular entrepreneurship and mass innovation" is to raise ordinary living standards - the faster, the better.

In advanced economies, the most important waves of innovation occurred in the 19th and early 20th centuries, when the first and second Industrial Revolutions dramatically altered living standards in the West. In contrast, the post-1970s "third industrial revolution" has not been able to reverse the decline of productivity and growth in the advanced economies.

When living standards are lower, innovation tends to focus more on practical innovations that help to lift people out of poverty rather than on luxurious innovations that offer distraction for the privileged few.

And that's precisely why Chinese innovation holds potential for far more than just new technologies and new industries. It offers a promise of a better world for all of us - not only to some of us.

The author is research director of international business at the India China and America Institute (USA) and visiting fellow at Shanghai Institutes for International Studies (China) and the EU Centre (Singapore).