Ideas and innovation in East Asia

The generation, diffusion, absorption and application of new technology, knowledge or ideas are crucial drivers of development. This paper surveys the diverse approaches to innovation adopted by East Asian economies, the problems faced and outcomes achieved, as well as possible policy lessons. Knowledge flows from advanced countries remain the primary source of new ideas in developing economies. The authors evaluate the role of three main channels for knowledge flows to East Asia - international trade, acquisition of disembodied knowledge and foreign direct investment. The paper then looks at the exceptionally fast growth in domestic innovation efforts in Korea, Taiwan (China), Singapore and China, drawing on information about R&D as well as original analysis of patent and patent citation data. Citation analysis shows that while East Asian innovations continue to draw heavily on knowledge flows from the US and Japan, citations to the same or to other East Asian economies are quickly rising, indicating the emergence of national and regional knowledge stocks as a foundation for innovation. A last section pulls together findings about policies and institutions to foster innovation, under three heads: the overall business environment for innovation (macroeconomic stability, financial development, openness, competition, intellectual property rights and the quality of communications infrastructure), human capital development, and government fiscal support for innovation.E-Business,Knowledge Economy,Economic Theory&Research,Technology Industry,Agricultural Knowledge&Information Systems

The Structure of Intra-Group Ties: Innovation in Taiwanese Business Groups

Business groups are a network form of multi-business firm that play central economic and technological roles in many emerging economies. We draw from the technology studies literature, complemented by concepts from studies of organizational networks, to investigate how equity, director, and operating ties between firms within groups shape their innovation opportunities. Technology studies suggest that such ties create both opportunities and constraints that influence innovative activity by affiliates and, in aggregate, by a group as a whole - opportunities that arise from access to information, people, money, and other resources, but also constraints that arise from entrenched relationships among different actors. The network literature, in turn, suggests that centrality and density of ties between firms within a group will shape the benefits and constraints. We find that the overall density and individual centrality of the three types of ties affects affiliate and group innovativeness among about 2,000 firms within 263 business groups in Taiwan between 1982 and 2000. Groups that offer affiliates focused access to financial resources and operating knowledge, coupled with autonomy from intra-group competition and strategic interference, often generate fertile opportunities for innovative activity by some of their members. The results also offer implications for multi-business firm innovativeness.

Innovation in China: the rise of Chinese inventors in the production of knowledge

In 2010 China was the world's fourth largest filer of patent applications. This followed a decade of unprecedented increases in investment in skills and Research and Development. If current trends continue China could rank first in the very near future. We provide evidence that the growth in Chinese patenting activity has been accompanied by a growth in Chinese inventors creating technologies that are near to the science base. Part of the success of China has been to attract the investment of foreign multinationals. This is also true for a number of other Emerging Economies. Europe's largest multinational firms increasingly file patent applications that are based on inventor activities located in emerging economies, often working alongside inventors from the firm's home country.China; innovation; offshoring; patents.

Innovation, technology and the global knowledge economy: Challenges for future growth

This paper discusses the role of knowledge, technology and innovation in economic growth within the context of the “Green roads to growth” project. It summarizes the current state of the art in this area, illustrates this with selected graphs and tables based on published statistics and raises issues for discussion. The main focus is on the big shift of our understanding of economic growth that has taken place in recent decades, exemplified by emergence of terms such as “the knowledge based economy”, “the ICT revolution” and “innovation”, which - although not an entirely new issue – did not get much attention a few decades ago. Particular emphasis is placed on reviewing the new micro-evidence on innovation and the knowledgebased economy that has emerged in recent years. However, since extensive micro-evidence on innovation and knowledge-based growth is available only for a limited number of developed economies, we also consider other types of indicators (that are available for a larger set of countries), and present a synthetic overview of the differences in performance across different parts of the globe. Finally we summarize the main trends and discuss the challenges posed by these for future growth, sustainability and policy.

Two Faces: Effects of Business Groups on Innovation in Emerging Economies

This paper argues that business groups in emerging economies exert dual effects on innovation. While groups encourage innovation by providing institutional infrastructures, groups also discourage innovation by creating entry barriers for small and non-group firms and inhibiting the proliferation of new ideas. Using OLS and panel data estimation techniques, followed by nonparametric analysis and semiparametric kernel regression, we find evidence of an inverted-U relation between group market share and innovation in industrial sectors of both Korea and Taiwan, during the 1981-1995 period. Institutional differences between Korea and Taiwan in terms of market structure and industrial policies provide useful conceptual implications from the empirical comparison.

A Changing Climate: Statistical Evidence of the Intellectual Property Landscape of Clean Energy Technologies

The intellectual property (IP) system plays an important role in the development and diffusion of technologies by determining the institutional context in which transactions occur. This article reviews the recent EPO report ‘Patents and Clean Energy Technologies: Bridging the Gap between Evidence and Policy’ and offers further insights into the interplay between patents, innovation in climate change mitigating technologies and access to technology. Empirical evidence and analysis of patent trends forms the basis for understanding the spectrum of policy choices available to combat climate change. In an effort to bridge the gap between policy and evidence, the EPO report provides ample statistical analysis of existing patenting trends, fleshes out the current patent landscape and assesses licensing trends in emerging technologies relating to climate change. This review evaluates these statistical insights and discusses the implications for both the developed and developing world. It aims to deepen understanding of how intellectual property influences the development of markets for green technologies.Climate Change Mitigating Technologies, Patent Statistics, European Patent Office, Technology Transfer

Technical Change and Economic Growth: Some Lessons from Secular Patterns and Some Conjectures on the Current Impact of ICT Technology

This paper discusses the link between patterns of technological change and economic development taking an evolutionary perspective. We argue that the modes and timing of such coupled dynamics are deeply influenced by the emergence of new techno-economic paradigms or regimes. ICT-based technologies are the drivers of the current paradigm, which, we show, is still at an early stage of diffusion, particularly for developing countries. Building from historical evidence, we argue that catching up of developing countries critically depends on their ability to master the technology behind the dominant technoeconomic paradigm. We then discuss threats and opportunities related to a possible ICTbased development path.Technical change, Economic Growth, ICT

Enterprise creation & anti-commons in developing economies: evidence from World Bank doing business data

Abstract: This paper looks at the tragedy of anti-commons and its implications on enterprise creation in developing economies. The most important features of the anti-commons are captured under a simplified theoretical economic model. The empirical part uses the data from “Doing Business” of the World Bank, to test for the high costs implied by scattered and fragmented decisions related to enterprise creation in developing economies. The attained results show the prevalence of anti-commons in relation to the development of new enterprises in developing economies relative to more developed countries. This points out how anti-commons can limit development and market economies through reducing business and enterprise creation and expansion. Awareness and development of appropriate remedies to anti-commons are among the means to ensure higher economic and social achievements.Anti-commons, Enterprise Creation, Licensing and Costs

Indicators of the Relative Importance of IPRs In Developing Countries

There remains considerable controversy on the economic impact of TRIPS (interpreted here as the tightening of IPRs) in developing countries; needless to say, the new round of WTO negotiations adds considerable interest to this controversy. This paper focuses on the long-term structural issues concerning the impact of TRIPS on industrial and technology development in poor countries. It does not, therefore, deal with such important current issues as the cost of medicines, agricultural inputs or genetic materials. Even in the analysis of technology development, it has a limited objective. It seeks to indicate the potential significance of IPRs by differentiating developing countries according to the expected impact of stronger protection. It does not measure statistically the strength of IPR regimes or their impact on development as such.

Fostering innovation in a small open economy: The case of the New Zealand biotechnology sector

The New Zealand Biotechnology sector is worthy of study for several reasons. While there is a large and growing international literature on economic aspects of biotechnology innovation these studies concentrate on the United States and Europe. The New Zealand biotechnology sector may be expected to develop along a different trajectory as a consequence of a markedly different set of initial and framework conditions. Government has indicated a strong interest in fostering innovation and aims to concentrate on selected areas where New Zealand may be able to develop a new comparative advantage. One such area is biotechnology, which would build on New Zealand’s existing comparative advantage in the primary sector (dairy, forestry, meat, wool and horticulture). This paper describes the preliminary results of an ongoing study that aims to fill some of the gaps in our knowledge of innovation processes in New Zealand while using the international literature as a benchmark. The paper focuses on the drivers of innovation in the biotechnology sector; the role of networks and other linkages; the role of government and industry, the role of human and venture capital, and data from patenting