Abstract:

Viewed from a global perspective, the problems that China has been facing during the transition and development process include some shared by other countries in transition, some unique to China and some intricate internationally. Based on this, the author, inspired by Lao Tze' s thought in Tao Te Ching that "knowledge of nature nurtures inclusiveness, and inclusiveness produces unselfishness", puts forward and elaborates on a proposal of "inclusive innovation of system" in view of system civilization. "Inclusive innovation of system" is a new proposition related to institutional economics. Its essence is to understand and respect objective laws, to seek justice with a "tolerant" mind like the sea in "empty sea, tolerance is a great", to construct a more open and advanced system management framework, to promote the system innovation of transition countries including China and to contribute to the development of human civilization.

Holding the idea of "inclusive innovation of system", the author suggests to build three "large roofs" of system civilization: the first one is that of Chinese reform based on the integration of various reform forces and "the balance between marketization and social justice"; the second one is that of crossstrait harmony based on the unity of crossstrait forces for peace and the principle of being rationally pragmatic; the third one is that of "new universal civilization" based on the absorption of the essence of western and eastern civilization as well as the fusion of multiple civilization.
The "inclusive innovation of system" should be realized step by step. Among the three "large roofs", the construction of the first one relies on the establishment of four supporting systems: (1) an innovative system of property rights to protect both stateowned and private property; (2) an innovative system of distribution to make both nation and people rich; (3) an innovative system of sustainable development to respect "universe", "nature" and "man"; (4) an innovative system of social management to value the people' s livelihood and democracy. During the process of innovation, two tendencies to "dignify officials" and to "debase civilians" should be avoided.

Key words: inclusive system, system innovation, system civilization, the fusion of multiple civilizations, new universal civilization