【正文】 D and technological innovation, improve industryperformance, promote domestic software demand, anddevelop industry scale. The Chinese government hascreated a superior environment for industrial development[43], especially with favorable and supportive policies.These policies are discussed below.. Encouragement policiesIn 2020, the Chinese government issued its “Policies fortheDevelopmentofSoftwareandICIndu。 furthermore, in 2020, Dalian HiThinkComputer Technology Company won the engineeringcontract to supply the ?nancial system for UzbekistanNational Raildasigni?cant breakthrough in terms oflaunching their software products in international markets.. International technology certi?cation. To date, ?veDalian City enterprises have passed CMMI5 (CapabilityMaturity Model Integration), four have passed CMM5(Capability Maturity Model), one has passed CMM4, andninehave passedthe CMMI3 and CMM3 Level certi?cations.. CapitalThe rapid development of the Dalian software industryhas driven enormous capital in?ow and accelerated thepace of infrastructure construction. The Dalian Citygovernment has also expanded ?nancial services to itsenterprises, as explained below.. Expansion of construction. Dalian Software Park hasinvested US$687 million in infrastructure overaneightyearperiod, its size currently exceeds 110 ha, and 280 paniesare now located in the park, making it the industrial parkwith the highest level of knowledge intensity in Dalian City,and the bestdeveloped infrastructure nationwide. Through2020, the number of foreign enterprises or paniesreached nearly 9000 from 72 foreign countries or regions,and the quantity of foreign capital reached US$229 million.Furthermore, 1826 of these foreign enterprises establishedof?ces in Dalian, including Dell Computer, GE Capital, andIBM。D of innovationtechnology. Inorder to enhance petitiveness, DalianCitygovernment guided local software enterprises to developtheir own Ramp。D, and technology certi?cation, tofurther accelerate technology upgrading, as detailed below.. Upgrade technology via international cooperation. Toestablish a platform for international technology cooperation and exchange, the Dalian City government hasattempted to attract foreign IT enterprises and organizations to establish their technology Ramp。 however, SD canuse causal loops to construct a dynamic model in whichtalent, technology, and capital are considered froma dynamic perspective as a circulating ?ow. Observersthuscanbetterexplainthein?uenceoftheenvironmenton dynamic behavior and systems, and analyze futuresystem development trends.C15 Industrial development is a longterm and evolutionaryprocess. It is hampered by periodic and inevitablepersonnel changes in senior management that preventpolicymakers from acquiring insight into the evolvingstatus and problems during the period of industrialChina. Jan et al. / Technology in Society 34 (2020) 163–173 165ThedevelopmentoftheChinesesoftwareindustrydatesback to 1978, and today has achieved some notablesuccesses. For example, the industry’s sales volumeincreased from US$55 million in 1999 to US$ millionin 2020, nearly 40% annual growth. Software exportsincreased from US$$ millionin2020, representing growth of nearly 15 times over 6 years[13]. This process and scale of development is summarizedbelow.. Software industry development processChina considers the software industry not only a majorinformation technology (IT) sector, but also one soThe scope of the industryclustereffect can be organizedin the following ways: single city, region, country, or anindustry work that includes neighboring countries [36].A software industry cluster includes allied manufacturersin the same industry that form and relate to the upstreamand downstream value chain for its ?nal product, manufacturersofplementaryproducts,?nancialinstitutions,and manufacturers in related industries. In addition, thegovernment provides organizations of professionaltraining, education, information, research, and technologysupport to accelerate development of the domesticindustry. The industry cluster thus is prised of a groupof geographically neighboring and mutually correlatedenterprises and corporations within a certain ?eld. Theseenterprises are linked via substitutes, plementarities,or supplychain relationships with upstream and downstream vertical division of labor [14,23].This study aims to add further understanding byanalyzing the development structure, process, and industrial characteristics of the software industry, and to use theresearch results as the foundation for constructinga dynamic model. In the following sections, the authorsdescribe the development process, scale, and features ofthe Chinese and Dalian software industries, and the rolesplayed by the Chinese government in developing the software industry.. Software industry development process and scale indevelopment. SD is an optimal methodology for constructing a dynamic model, as it leads the direction ofthinking, focuses discussion, expands the scope ofdiscussion, and enhances the quality of policyformulation.C15 None of the recent studies of the Dalian softwareindustry have conducted a prehensive and indepthexploration of the industry using the SD methodology.Therefore, our study applied SD causal loops to collectinformation and data for discussing the cluster effect onthe development of the Dalian software industry, and toconstruct the dynamic model of the software industrydevelopment.3. Analysis of the software industry cluster in Chinafundamental and strategic to its economy that it is directlyrelated to national politics, economy, and society. Furthermore, China has prioritized the development of the ITsector by prehensively applying IT to all societal andeconomic areas