Technical Self-Sufficiency, Pricing Independence: A Penrosean perspective on China’s Emergence as a Major Oil Refiner since the 1960s

Tobin, Damian

Abstract

International embargos and the withdrawal of Soviet technical expertise had by the early 1960s effectively engrained China’s approach to energy and technical self-sufficiency. Chinese officials cited reasons similar to those advanced by Edith Penrose in her critique of the international oil companies’ (IOC’s) investments. Drawing on Penrose’s approach, this article shows that although self-sufficiency led to significant progress in primary capacity, self-sufficiency had to be reconciled with increasing demand for more complex petrochemicals. Modernisation increased China’s reliance on the IOC’s technology and reduced pricing independence, confirming a historical regularity in the market imperfections underpinning the power of the IOCs.

Citation

Tobin, D. (2019). Technical Self-Sufficiency, Pricing Independence: A Penrosean perspective on China’s Emergence as a Major Oil Refiner since the 1960s. Business History Review, 61(4), 681-702. https://doi.org/10.1080/00076791.2017.1413095

• Journal Article Type: Article
• Acceptance Date: Nov 29, 2017
• Online Publication Date: Jan 3, 2018
• Publication Date: Jan 1, 2019
• Deposit Date: Dec 21, 2017
• Publicly Available Date: Dec 21, 2017
• Journal: Business History Review
• Print ISSN: 0007-6805
• Electronic ISSN: 2044-768X
• Publisher: Cambridge University Press
• Peer Reviewed: Peer Reviewed
• Volume: 61
• Issue: 4
• Pages: 681-702
• DOI: https://doi.org/10.1080/00076791.2017.1413095
• Keywords: Penrose, international oil firms, national oil companies, China, petroleum industry