NEV

The mystery of the rapid rise of China's new energy vehicle (NEV) industry has attracted widespread attention. This paper applies leapfrogging theory to explain this phenomenon from the perspectives of new technologies and low wages. By constructing a Dynamic Stochastic General Equilibrium (DSGE) model that incorporates new technology shocks as well as the NEV manufacturing sector and the technology R&D and application sector, numerical simulations show that new technology shocks have a positive, non-linear promoting effect on the growth of NEV output, and this effect is more significant under low-wage conditions. Furthermore, based on data from 919 Chinese A-share listed NEV companies from 2000 to 2024, this paper empirically tests the theoretical conclusions. The results are as follows. The positive impact of new technologies on NEV operating revenue increases with the level of new technology, a finding that holds after a series of robustness tests, including the instrumental variable method. The lower the average annual employee compensation and the larger the relative manufacturing wage gap between China and the United States, the stronger the non-linear promoting effect of new technologies. In view of this, latecomer countries should seize the window of opportunity to replace old technologies with new ones, leverage low wages, and enhance technological catch-up through regional scientific and technological infrastructure development, ultimately achieving leapfrog industrial upgrading.