Technological Change and Economic Catch-up

Technological Change and Economic Catch-up

The Role of Science and Multinationals

Edited by Grazia D. Santangelo

This book tackles the issue of technological and economic catch-up by examining the role that public research institutions and local policy play in the promotion of this process by fostering local science–technology linkages with incoming foreign-owned multinationals. Although the book comprises various techno-socio-economic contexts and different methodological perspectives, the authors share the idea that public research, educational and political institutions provide capabilities in basic research and training of highly skilled labour, while private corporations establish networking connections with scientific and professional communities (and therefore access to knowledge and contacts) in other parts of the world.

Chapter 9: Catching Up or Standing Still? National Innovative Productivity Among ‘Follower’ Countries, 1978–1999

Jeffrey L. Furman and Richard Hayes

Subjects: business and management, international business, development studies, development studies, innovation and technology, innovation policy


* Jeffrey L. Furman and Richard Hayes* 1. INTRODUCTION Examining the state of British industrial performance in 1980, Keith Pavitt cautioned that unless the nation made substantial improvements in its innovative capacity, both through additional industrial R&D and improved linkages between R&D and product development, its prospects for long-run economic growth would dim (Pavitt, 1980a, 1980b). This sentiment resonates with those of economists and policymakers, who have focused increasing attention in the years since World War II on the centrality of scientific and technological advance in driving economic progress and who have argued that increasing national investments to innovation are essential to ensure countries’ economic growth (Schumpeter, 1942; Bush, 1945; Solow, 1956; Abramovitz, 1956; Romer, 1990; Jones, 1995). In the near quarter-century since Pavitt’s initial appeal, Great Britain has made investments in its innovative capacity; its level of R&D expenditures and its realized level of USPTO (US Patent & Trademark Office) patenting have increased by approximately 30 percent each. At the same time, neighboring Ireland, whose standard of living in the early 1980s was substantially lower than Britain’s, has vastly increased its economic and policy commitments to innovation, boosting its count of R&D personnel nearly tenfold and achieving a 350 percent increase in USPTO patents, thus achieving a rate of per capita patenting comparable with that of a number of the more innovative countries in the world. The experience of these countries is illustrative of two striking facts about country-level innovative output over the last...

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