Technology+Diffusion

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 * 1) Should a developing country seek to create a capacity for technology commercialization, and if so for what expected outcomes? What World Bank and other knowledge do we have of this process?
 * 1) What will be the fate of lower income countries which continue to rely exclusively on technology absorption and adaptation?

Studies show that the bulk of technological progress in developing countries has been the absorption and adaption of preexisting but new-to-the-country or new-to-the-firm technologies, rather than the invention of new-to-the-world technologies.The World Bank report Global Economic Prospects 2008 Science and Technology Diffusion discussed diffusion in depth [|Global_Economic_Prospects_2008_ST_diffusion.pdf] Therefore, advice given to most developing countries and sectors is that R&D should focus on the adoption and adaptation of preexisting technologies, not on efforts to expand the global technological frontier. The transition from such technology diffusion to technology commercialization, or indeed the relevance of technology commercialization for developing countries is less understood.

**Technology, Adaptation, and Exports - How Some Developing Countries Got It Right**. Edited by Vandana Chandra and Shashi Kolavalli, the World Bank, 2006.

[From the report]

"THE HISTORY OF ECONOMIC DEVELOPMENT IS replete with cases in which governments have tried unsuccessfully to promote the use of new technologies to accelerate growth. The many reasons for failure include bad luck, poor governance, flawed policy design, and weak implementation. That said, developing-country policy makers must continue to look for innovative ways to increase economic growth, especially through exports. The challenges they face are daunting, not least because global competition is rising and taking new forms, driven by rapid technological change and the growth of global production networks in which sophisticated skills and capabilities are required at the entry level, even for manufactured goods as simple as T-shirts. At the same time, it is easier than ever before to gain access to technology. Knowledge of new production techniques—often bundled with financial, management, and technical skills—is carried across national boundaries to be paired with natural resources and local factor markets in new global production centers. For many developing countries, especially low-income ones, easier access to technology offers renewed hope for improving competitiveness and growth. To realize that hope, however, countries must become able to apply the new technologies. In this task, the developing countries are not alone. The government of almost every country that has experienced significant, sustained growth has been involved in a major way in promoting technological development and in supporting the private sector in the quest to improve productivity. This volume studies 10 cases of developing countries that successfully adapted new technologies to catch up with developed countries in a particular industry."

<span style="font-family: Arial,Helvetica,sans-serif;"> See also The "how to" of **Catching up in Technological Adaption - lessons from 10 successful cases** Vandana Chandra. The World Bank, 2005 []

<span style="font-family: Arial,Helvetica,sans-serif;">Cases from India (from maize to poultry, wine, software IT), Chile (table grapes to wine, salmon farming and processing), Uganda (Nile perch), Kenya (cut flowers), Malaysia (oil palm to oleo chemicals), Taiwan (high-end electronics), and Malaysia (low-end electronics),

<span style="font-family: Arial,Helvetica,sans-serif;"> We may look at the above question from another perspective: The role of Design and Development - D+D (versus Research and Development - R&D) in the context of Technological Innovation. Conventionally, and for a long time R&D has been under attention (due to variety of reasons), and the role of D+D has not been sufficiently appreciated. The D+D activities embraces a variety of activities such as absorption and adaptation of technologies, as well as Forward and Reverse Design. By combining the R&D and D+D we will have a more comprehensive model for technological innovation.

<span style="font-family: Arial,Helvetica,sans-serif;"> In the context of the new model for technological innovation, it would be possible to have a better understanding on the role of R&D versus D+D activities for the different types of industries and in the different countries. A case serves as an example: IDEO which a very successful and innovative company in the Silicon Valley, is NOT an R&D company, it is a Design company.

<span style="font-family: Arial,Helvetica,sans-serif;">Modules
> > <span style="font-family: Arial,Helvetica,sans-serif;"> “The capacity to absorb and diffuse existing knowledge is at least as important as the capacity to produce new knowledge….Innovation more frequently entails building the capacity to use technologies that are in widespread use elsewhere but that are new to the country, new to the firm, or used in new ways. To facilitate this type of innovation, countries must build the capacity to find, absorb and use these technologies.” > > <span style="font-family: Arial,Helvetica,sans-serif;"> Watkins and Ehst, Science, **Technology and Innovation: Capacity Building for Sustainable Growth and Poverty Reduction**, World Bank, 2008, available at [], P. 7. >
 * 1) <span style="font-family: Arial,Helvetica,sans-serif;">Necessary conditions for a developing country (in addition to absorbing and adapting preexisting and new-to-the-market or new-to-the-firm technologies) to create R&D capacity and subsequently be able to commercialize the results of R&D to produce new businesses, products and services to address national needs.
 * 1) <span style="font-family: Arial,Helvetica,sans-serif;">Knowledge and support needed so that a developing country can build on its experience of technology diffusion to create R&D and commercialization capacity.
 * 2) <span style="font-family: Arial,Helvetica,sans-serif;">Balancing limited resources between supporting both diffusion and commercialization to achieve outcomes superior to those of diffusion alone – in the short and long term.
 * 3) <span style="font-family: Arial,Helvetica,sans-serif;">Experience of developing countries with open innovation and open business models in supporting and extending technology absorption and adaptation.
 * 4) <span style="font-family: Arial,Helvetica,sans-serif;">Forward versus Reverse Design [[file:Reverse-Design-MSTC-09.pdf]]

<span style="font-family: Arial,Helvetica,sans-serif;">These Modules are a guide only to the planned content of this Handbook Section. Please add new content to this page, or use the discussion Tab. As the wiki grows we will move things around.

Henry Chesbrough Economy, Culture & History JAPAN SPOTLIGHT Bimonthly []
 * Open Innovation: A Key to Achieving Socioeconomic Evolution • 3 How Smaller Companies Can Benefit from Open Innovation**

How should SMEs address the opportunities and risks posed by open innovation? SMEs have some structural disadvantages when it comes to open innovation. They often lack many of the capabilities necessary to identify, transfer and absorb external ideas and technologies effectively from outside into their firms.

F. Montes-Negret Director, Private and Financial Sector Europe and Central Asia, The World Bank
 * Technology Absorption by Innovative SMEs [[file:CLOSINGFMN-1.ppt]]**
 * Globalization has been a main driver of technological progress
 * The technology gap between rich and poor countries has narrowed -- but remains large
 * Progress in developing countries reflects the absorption of pre-existing technologies – not at-the-frontier inventions
 * Technology diffusion across countries has picked up, but diffusion within countries remains slow and penetration rates uneven
 * Persistent weakness in technological absorptive capacity may constrain further technological progress

Potential for affordable solutions in agriculture, health care and environment improvement []
 * Fostering Accelerated Technology Absorption for Affordable Health, Agriculture, Energy and Environmental Products**