Computer bargaining in México and Brazil 1970-1990: dynamic interplay of industry and politics

Abstract

Theories of host country – TNC bargaining seek to explain dependency shifts based on positional assets and relative capabilities. This analysis of the efforts of México and Brazil to promote and direct the development of a national computer industry from 1977 to 1990 reveals a bargaining landscape that is more dynamic than the traditional bargaining model anticipates. This thesis explains the variable nature of bargaining gains and losses by analysing the on-going, complex interplay of political, industry and market forces. Despite industry characteristics that favoured foreign capital, both México and Brazil achieved bargaining gains in the computer industry. Brazilian state actors enticed national finance and industrial groups to invest in the industry, prompted the development of indigenous technological capacity, and limited the market influence of computer transnationals for more than a decade. With more limited policy ambition, support and duration, México had initial success prompting TNC minority joint ventures in microcomputers and extracting concessions from the TNCs for exports. In both cases, however, bargaining gains were not secure; shifts in dependency were not progressive and one-directional. In fact, the study exposes a reverse trend toward greater dependency on foreign capital in both countries. For this reason one may not employ either case to support the obsolescing bargain in high technology industries. This thesis highlights three factors neglected by the traditional bargaining construct: the dynamism of the global computer industry which opened and close