Inward technology transfer and competitiveness: the role of national innovation systems

Abstract

This paper examines the role of national innovation systems in the inward transfer of technology that has underpinned the transformation of Japan and other East Asian economies since 1945. The economies that have benefited most from inward technology transfer have national innovation systems that have strengthened their 'national absorptive capacity'. This capacity relies primarily on investments in scientific and technical training, and on economic policies that enforce competition among domestic firms. The particular channels for inward technology transfer, the identity of any 'strategic industries' targeted for public intervention, and the overall level of a nation's trade restrictions are all of secondary importance.