Innovation Offshoring:Asia's Emerging Role in Global Innovation Networks

Most analysts agree that critical ingredients for economic growth, competitiveness, and welfare in the United States have been policies that encourage strong investment in research and development (R&D) and innovation. In addition, there is a general perception that technological innovation must be based in the United States to remain a pillar of the American economy. Over the past decade, however, the rise of Asia as an important location for "innovation offshoring" has begun to challenge these familiar notions. Based on original research, this report demonstrates that innovation offshoring is driven by profound changes in corporate innovation management as well as by the globalization of markets for technology and knowledge workers. U.S. companies are at the forefront of this trend, but Asian governments and firms are playing an increasingly active role as promoters and new sources of innovation. Innovation offshoring has created a competitive challenge of historic proportions for the United States, requiring the nation to respond with a new national strategy. This report recommends that such a strategy include the following elements: output forecasting techniques ... Improve access to and collection of innovation-related data to inform the national policy debate; Address "home-made" causes of innovation offshoring by sustaining and building upon existing strengths of the U.S. innovation system; Support corporate innovation by (1) providing tax incentives to spur early-state investments in innovation start-ups and (2) reforming the U.S. patent system so it is more accessible to smaller inventors and innovators; and Upgrade the U.S. talent pool of knowledge workers by (1) providing incentives to study science and engineering, (2) encouraging the development of management, interpretive, cross-cultural, and other "soft" capabilities, and (3) encouraging immigration of highly skilled workers.Innovation Networks, Innovation Offshoring, Asia

Sending Jobs Overseas: The Cost to America’s Economy and Working Families

[Excerpt] This report was created by Working America and the AFL-CIO as a companion piece to Work­ing America’s Job Tracker, a ZIP code –searchable database of jobs exported (as well as Occupational Safety and Health Act violations and other work­place issues). Users can search their area for com­panies that have sent jobs overseas. Though Job Tracker is one of the largest publicly available, fully searchable records of the extent and specifics of outsourcing, it only reveals the tip of the iceberg. This report and Job Tracker contextualize each other—Job Tracker by mapping specific job losses due to outsourcing, the report by taking a broad view of the national-level numbers that are avail­able and offering case studies of key industries

South Asia: A development strategy for the information age

Over the last 50 years, Asia has been the most successful region in the world in terms of rapid economic development. The success of Asia is largely because of the adoption of the (Manufactured) Export-Oriented Growth Strategy or (M)EOGS by one group of countries after another. (M)EOGS, modeled on Japan’s postwar strategy, was successfully followed by the four “Asian tigers” (Hong Kong, China; Singapore; Republic of Korea; and Taipei, China). It was subsequently, adopted by a number of Southeast Asian countries (Indonesia, Malaysia, and Thailand), followed by the People’s Republic of China (PRC) and, more recently, by Viet Nam. The question is: Will this process continue to extend to other countries in Asia, with South Asian countries ultimately becoming the manufacturing export power houses of the future? The answer to the first part of the question is probably yes, and to the second part, probably no—and therefore the need for an alternate strategy. This paper looks at some features of (M)EOGS in East/Southeast Asia, its limitations in the case of South Asia, and then present an alternative development strategy which may be more appropriate for South Asia.Alternative development models; Trade; Regional cooperation; Economic integration; South Asia

The complex interaction between Global Production Networks, Digital Information Systems and International Knowledge Transfers

Traditionally many studies of knowledge in economics have focused on localized networks and intra-regional collaborations. However, the rising frequency by which firms collaborate within the context of global networks of production and innovation, the increasingly intricate divisions of labor involved and the extensive use of the Internet to facilitate interaction are all relatively novel trends that underline the importance of knowledge creation and flows across different locations. Focusing on this topic, the present chapter examines the complex interactions between global production networks (GPN), digital information systems (DIS) and knowledge transfers in information technology industries. It seeks to disentangle the various conduits through which different kinds of knowledge are transferred within such networks, and investigate how recent generations of DIS are affecting those knowledge transfers. The paper concludes that the dual expansion of GPN and DIS is adding new complexity to the practice of innovation: To access knowledge necessary for sustained creativity firms often have to link up with remote partners in GPN, but to be able to absorb and utilize this knowledge, they also frequently have to engage in local interactive learning processes. These local- global linkages - and the various skills necessary to operate them - are strongly interdependent, mutually reinforcing and critical for the development and maintenance of innovation-based competitiveness.

Foreign R&D Centres in India: An Analysis of their Size, Structure and Implications

The study measures the contribution of MNCs to the generation of innovations from India. The focus is on innovations that are carried out in foreign R&D Centres. After having mapped out the size of this sector, the study develops a way of classifying them into two categories on the basis of their actual record with respect to performance of innovations. Further we survey the policies that are available in India to promote FDI in R&D services. The study also identify the characteristics of these foreign R&D centres in terms of a number of indicators like their, size, domain expertise, physical location and then it distils out the interaction of these centres with India’s National System of Innovation. The latter is carried out through a primary survey. The contribution of this study is an identification of the size of foreign R&D Centres in India from official sources of data and its actual working. The study has thus a number of pointers for public policy for promoting this activity so that it is beneficial to the host economy of India.

VLSI Revisited - Revival in Japan

This paper describes the abundance of semiconductor consortia that have come into existence in Japan since the mid-1990s. They clearly reflect the ambition of the government - through its reorganized ministry METI and company initiatives - to regain some of the industrial and technological leadership that Japan has lost. The consortia landscape is very different in Japan compared with EU and the US. Outside Japan the universities play a much bigger and very important role. In Europe there has emerged close collaboration, among national government agencies, companies and the EU Commission in supporting the IT sector with considerable attention to semiconductor technologies. Another major difference, and possibly the most important one, is the fact that US and EU consortia include and mix partners from different areas of the semiconductor landscape including wafer makers, material suppliers, equipment producers and integrated device makers.semiconductors, Hitachi, Sony, Toshiba, Elpida, Renesas, Sematech, VLSI, JESSI, MEDEA, ASPLA, MIRAI, innovation system

VLSI REVISITED – REVIVAL IN JAPAN

This paper describes the abundance of semiconductor consortia that have come into existence in Japan since the mid-1990s. They clearly reflect the ambition of the government – through its reorganized ministry METI and company initiatives - to regain some of the industrial and technological leadership that Japan has lost. The consortia landscape is very different in Japan compared with EU and the US. Outside Japan the universities play a much bigger and very important role. In Europe there has emerged close collaboration, among national government agencies, companies and the EU Commission in supporting the IT sector with considerable attention to semiconductor technologies. Another major difference, and possibly the most important one, is the fact that US and EU consortia include and mix partners from different areas of the semiconductor landscape including wafer makers, material suppliers, equipment producers and integrated device makers.semiconductors; Hitachi; Sony; Toshiba; Elpida; Renesas; Sematech; VLSI; JESSI; MEDEA; ASPLA; MIRAI; innovation system

International competitiveness of the european economy with regard to the EU state aid policy: the case of nanoelectronics. Summary

The domestic growth of high-tech industries is seen as central to future economic development in many countries. In this context, companies are often granted high levels of state support (e.g. through subsidies or tax breaks) to promote growth and employment in these promising sectors or fields of technology. In Europe, however, state support opportunities are regulated by EU state aid control. The aim is to reduce state aid from member states in order to promote European integration and free competition within Europe. State aid is only granted by EU member states under certain conditions Subject and objective of the project The impact of EU state aid control on national policy-making in the field of nanoelectronics is being discussed particularly intensively. Nanoelectronics is regarded as an important cross-sectional technology or industry whose components are in demand and used in numerous user industries. In particular, the construction of new production facilities is massively supported by some states, and at the same time production sites are increasingly being established outside Europe. The effects of EU state aid control on the competitiveness of Europe and its member states such as Germany are generally complex and above all indirect. They depend centrally on the development of other factors in the innovation system (e.g. demand, domestic establishment of user industries), the interaction of these factors, the use of complementary policy instruments and the extent of public support in non-European countries. The Innovation Report therefore examines the following research questions: Which factors influence the attractiveness of individual countries as locations for nanoelectronics? How should the current competitiveness in Germany and Europe be assessed? What consequences would a loss of production capacities have for the entire "nanoelectronics innovation system"? To what extent is there a situation in the field of nanoelectronics that justifies state aid? How can a sustainable funding policy be implemented, especially under the given conditions of limited state aid possibilities? To what extent can the example of nanoelectronics be transferred to other technologies and sectors

Competitiveness of the Philippine IT Industry: What Lies Ahead

This paper examines the competitiveness of the Philippine information technology (IT) industry vis-à-vis its emerging competitors and neighboring countries in the region. While the industry boasts of being the largest foreign exchange earner for the country, it suffers from structural weaknesses that, unless addressed, render its long-term competitiveness at risk, especially as the competitors are increasing their stake in the world IT market faster than the Philippines. This paper discusses what constraints the industry’s long-term growth and identifies some crosscutting strategies to lessen or overcome such difficulties and keep the industry’s present edge.globalization, information technology (IT)