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Session Overview
PS-2.09: Technological infrastructure and technological capabilities 2
Thursday, 13/Oct/2016:
8:30am - 10:00am

Session Chair: Swati Mehta, Guru Nanak Dev University, Amritsar, Punjab
Discussant: Rajah Rasiah, UNIVERSITY OF MALAYA
Location: Palace Room (Homann)

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Exploiting Investments in Infrastructure as an Innovative Policy Instrument for Building Technological Capability: Nigeria in Perspective

Gordon Monday Bubou

National Centre for Technology Management, Federal Ministry of Science & Technology

The emergent global challenges in a flattened world has recognised technological capability to be the bedrock for a technology-driven development. Indeed, substantial body of literature indicates that the acquisition of technological capability was crucial to industrial growth and development, and for the achievement of competitiveness Technological infrastructure has been fundamental to building of technological capability. Therefore, the winners and losers across countries are determined by investments not only in basic, but in new kinds of infrastructure – technological infrastructure. We assert that inherent in technological infrastructure were skills, particularly technical skills. But most developing countries are faced with the twin challenges of inadequate infrastructure and lack of relevant skilled human capital. It is observed that most developing countries undertaking investments in infrastructural projects, particularly capital goods were not only far away from the technology frontiers, but also lacked relevant capability to either sustain existing infrastructure or maintain new ones. Interestingly, it is demonstrated that public procurement for infrastructure creates additional benefits of skills development via learning by doing, the development of local industries, and ultimately leads capability development. The reason is that, externalities, spill-overs and deliberate exchanges of information and skills always characterise learning. The question then is: what policy mixes are to be considered to exploit opportunities for technological capability building from infrastructural development projects? We a snapshot of an example of the situation in a developing country – Nigeria. To ensure appropriate transfer of technology, knowledge and skills in Nigeria, and drawing examples from UK, South Korea and Brazil, the author(s) had earlier advocated that through a policy proclamation by the national government, a work-based and learning by doing platform be provided during project initiation, through the execution and operational phases. Nevertheless, linkages to equivalent global developing countries perspectives are presented here.

Dynamics of Technological Capability Development in Grand Ethiopian Renaissance Dam Project

Ameha Mulugeta Gewe, Daniel Kitaw Azene

Addis Ababa Institute of Technology (AAiT), Addis Ababa University (AAU), Ethiopia

Technological capability underpins the developmental difference between developed and developing economies. Understanding the developmental dynamics of technological capability is vital in order to devise policies that facilitate and foster cumulative buildup. For developing countries, financial constraints significantly influence and hider capability development. However, many megaprojects are being constructed utilizing various financial accesses in order to pave way for sustainable development. This paper explores the dynamics residing in these megaprojects for technological capability development of local firms in developing countries by considering Grand Ethiopian Renaissance Dam (GERD) project. A hypothetical system dynamics model is developed and verified using case scenario approach. As illustrative examples, IPR sensitivity and learning rate variables are considered for policy concerns in order to explore resulting effect on various variables that contribute to technological capability development. Results are discussed in order to show how these policy directions can be pursued to accelerate technological capability accumulation process.

The impact of “Technological Heterogeneity” and “Time” in determining FDI spillovers on Export Performance of Indian Manufacturing Firms

Sanghita Mondal

P.G.D.A.V College, University of Delhi, India

FDI and its effects on host country firms have drawn considerable attention during the last few decades due to the surge of FDI in developing countries. Previous studies have shown that India could rarely draw any positive benefit from FDI. However, it has been a constant question of the researchers whether the impact has varied across the technology sectors or if there is any impact in the recent years since there has been a huge inflow of FDI within the country since 2002. In view of that, the present study focuses on these two facts. In the first part, the manufacturing firms are also categorised according to the technology intensity following OECD definition. In the second part, the study period of (1994-2010) has been divided into two sub-periods: 1994-2001 and 2002-2010. We have divided the FDI spillover channels into competition (domestic market activity), information (export activity), skill (a proxy to measure spillovers from higher foreign skills) and imitation (R&D and technology import) spillovers. We also consider that in house R&D activity and technology import influence the export performance of the host country firms. Our findings show that most of the spillover channels are not influencing export decision or export activity of the Indian firms except the firms in the MHT sector. On the other hand, the sub-period analysis show that after the huge surge of FDI since 2002, India’s export performance has been severely affected as compared to the previous sub-period indicating that India was being used as export platform and most of the FDI was attracted towards domestic market. Thus, there is a need to look into the proper policy implications while allowing FDI within the country.

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