Elliot Ng‘s take: China has strong adaptive creativity.

This means that Chinese companies show tremendous amounts of creativity in adapting concepts developed in other markets to the particularities of China, whether they are government restrictions or market limitations.

One example he cites is a company that developed a cheap point of sale device that attaches to mobile phones and allows small retail stores have a point of sale device managing inventory and keeping accounts. These stores would otherwise be unable to buy a cash register. (Very interesting concept. Be great to get the name of the company, Elliott!)

Rebecca Fannin, author of the recently published Silicon Dragon, adds her voice to the debate between William Bao Bean – Expect more Digital Garages in China – and Vivek Wadhwa – China is NOT the new Silicon Valley – about whether China’s tech sector is creative.

Not surprisingly, given the title of her book, Fannin argues that China offers a great deal of digital creativity.

Does she convince you?

His studies, published at Globalization Research, have included looking at the level of innovation in China, the relative gap in engineers graduated when comparing India/China and the US (His studies controversially assert that the US does not have such a huge deficit of engineers) and a study showing that the number of Indians and other immigrants in Silicon Valley is not as great as many presume.

Mr. Wadhwa writes a column for Businessweek and enjoys aiming to debunk popular notions and perceived wisdom.

“China is simply unable to innovate,” said Wadhwa, a Harvard fellow and Duke University professor. A former technology entrepreneur, Wadhwa now specializes in studying business creativity and innovation.

China’s tech economy is built on copycats that totally lack any sort of innovation, particularly given the amount of money spent on research and development by companies and the government in China, Wadhwa said.

As to Bao Bean’s assertion that creativity and digital garages will be inspired in part by the high level of investment brought in by foreign venture capitalists, Wadhwa said: “There is a lot of money being wasted by a lot of VCs in China.”

China’s younger generation is extremely creative, but those running China’s research and development are not bringing anything new, Wadhwa said.

Asked for numbers to back this assertion, Wadhwa said that the numbers tell the exact opposite story. China files a large number of patents and produces a large number of research-related papers, but there are few actual innovations coming out.

Nonetheless, those good number hide a total lack of creativity, based on Wadhwa’s qualitative analysis.

Wadhwa said the exact opposite seems to be true in India, where relatively little is invested in research and development. India has fewer patents and papers than China, but the country is building itself into a innovation powerhouse.

The fundamental difference, Wadhwa said, is that Indian engineers are encouraged to think beyond their narrow role and build more innovation into their activities.