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Innovation and Small Enterprises in the Third World

Innovation and Small Enterprises in the Third World

New Horizons in the Economics of Innovation series

Edited by Meine Pieter van Dijk and Henry Sandee

Innovation is crucial for small enterprises to become and remain competitive in the global economy. In this book, the authors have combined theoretical insights with comprehensive case studies on innovation among small-scale enterprises in developing countries, paying particular attention to technological change in clusters of small firms.

Chapter 15: Innovation and Small Enterprise Development in Developing Countries: Some Conclusions

Meine Pieter van Dijk and Henry Sandee

Subjects: development studies, development economics, economics and finance, development economics


Chapter 15 15/3/02 8:55 am Page 1 15. Innovation and small enterprise development in developing countries: some conclusions Meine Pieter van Dijk and Henry Sandee Our aim was to study what innovation means for the development of small enterprises in developing countries. Innovation adoption and technological change in small enterprises are frequently discussed without agreement on their main characteristics and features. There is a need for a framework to put order in all the different studies, classifications, definitions, and concepts that are used while studying this topic. Therefore we have opted for a broad definition of innovation, which includes the diversity of experiences with technological change and small enterprise development. After discussing the broad definition, we discuss in this chapter how to view the experiences with innovation adoption given all the recent attention to local technological capability and capacity for small enterprise development. We prefer using the concept of technological capacity for this final chapter as it is somewhat broader than capability (see also Romijn’s contribution). The technological capability literature is concerned with long-term development processes and is interested in whether innovation adoption will become an ongoing process rather than remaining a one-time event. In the latter case small enterprises may adopt new technology but it does not necessary imply that they are embarking on a trajectory of indigenous technological upgrading. This is a particularly relevant issue for clustered small enterprises, widely discussed in this book, as there is ample evidence of agglomerations of small producers in developing countries...

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