Technology and the Market

Technology and the Market

Demand, Users and Innovation

Edited by Rod Coombs, Ken Green, Albert Richards and Vivien Walsh

The interplay between demand from the market, the role of users in shaping that demand, and the way in which these factors influence the innovation process has always been a complex one. This forward thinking book examines this interplay from a technological change perspective. The contributors explore the potential for rapprochement between economics, sociological and other social science disciplines in considering the allocation of resources and the making of decisions about technological change. The papers within this book represent a judicious blend of theory and empirical research and look at a broad range of innovations, markets and technologies in medicine, agricultural and food production, services and IT. Technology and the Market raises the question of the many ‘visible hands’ that are involved in linking technology and the market together.

Chapter 14: The missing link: innovation and the needs of less-developed country users

Andrew Tylecote and Claudia Galvao

Subjects: innovation and technology, innovation policy


Andrew Tylecote and Claudia Galvao INTRODUCTION Demand, market signals and user needs are regarded as stimuli for innovation but their role in the process is an area that requires discussion. This chapter seeks to do that by exploring an important area in which in a key respect innovation (and diffusion) almost totally fails to respond to user needs – as it has done for decades, and will continue to do so (we argue) until there has been a radical change in the policy of governments and international bodies. This is the adoption of technology by ‘Southern’ or ‘less developed’ countries (LDCs). We argue that ‘Northern’ technology in general is grossly unsuited to the needs of Southern societies taken as a whole, because it demands 1. 2. 3. too high a ratio of capital (physical and human) to labour, too high an initial technological capability, and usually too large a scale in usage. However, firms in the South (native as well as multinational companies) continue to adopt it, and Southern governments (together with the World Bank, etc.) continue to promote it, in preference to adopting or developing more appropriate alternatives. We show, with examples including the Brazilian food-processing industry, how this unfortunate distortion occurs. Before that, however, we show with the example of 19th and early 20th century Japan, how it has not happened in every LDC. WHY NORTHERN TECHNOLOGY IS INAPPROPRIATE FOR THE SOUTH Ever since Ricardo, neoclassical economics has distinguished among different national and regional economies in terms of their...

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