DEVELOPMENT OF TECHNOLOGICAL CAPABILITY : AN INTERNATIONAL PERSPECTIVE

Abstract

This academic exercise aims to examine the technology development of eight selected OECD countries and two Asian NIEs, namely, Korea and Taiwan, from a global perspective. As technological advancement is emerging to be one of the most critical factors for sustainable development, every country must strive to develop a technology-based strategy for her growth in this rapidly changing world. In order to achieve sustainable development, countries must have the autonomous capacity to absorb, digest and apply to both indigenous and foreign developed technology. The level of the technology development in each country is assessed using input and output indicators commonly employed for the measurement of technology. It is found that the larger and more industrialised a country is, the more government and industry tend to spend on research and development. Furthermore, there is a swing from public to private financing for R&D for most countries since the early eighties. The study also examines the effectiveness of various technology policies formulated and implemented by these countries. Successes and failures of these countries in pushing for technological advancement are highlighted and the unique factors contributing to each country's successes and failures examined. As the technology base of Singapore is relatively low compared to OECD countries and even Asian NIEs (except Hong Kong), it is hoped that valuable lessons can be drawn from the above analysis. The objective is to enable Singapore to formulate a flexible technology policy in responding to the technology dynamics of a fast changing world. These findings suggest that Singapore must continue to identify world technology trends and capitalise on her inherent advantage and focus her energies on critically selected niche areas relevant to her strengths and excel within these niches. Furthermore, Singapore should view the world as her resource and not be constrained by her limited land size. Due to the restrictions on access to technology and the protectionism prevailing in the major OECD markets, it is also imperative that Singapore maintain a minimum technology and research level in areas that may be insignificant today but potentially important tomorrow to prevent a widening of this gap. On a worldwide level, it is found that the most research-intensive industries belong more or less to the same industry groups. These industries not only spend the highest share of value added on research, they are also the core industries from which new products and processes spread to other industries. In conclusion, technology advancement and/or the ability to exploit them, do act as an important engine of growth for individual countries in the long run. However, technological development or advancement is only a necessary but not a sufficient condition for economic development.