Technology Transfer Technology Diffusion and Commercialization

Technology transfer A technology developed by an organization for a particular purpose was further given to other entities in order to exploit its potential in some areas. A transfer/transformation/transition process between the technology originator/possessor and the receiver

The economic view of technology transfer Information is the intrinsic core Technology is the exterior expression Practice Research Approach Information economics, Transaction cost Economics, Institutional Economics

The transferring level International from the DCs to NICs or LDCs Regional indigenous vs. foreign Industrial the threat of outsiders Corporation licensing program Internal the issue of transferring price

Channels of technology flow Public dissemination Reverse engineering Purposeful acquisition Licensing Franchise Joint venture Turkey project Foreign direct investment Technological consortium & joint R&D

Technology consortia Some European technological development consortia coordinated by EC/EU Race (Research in Advanced Communication in Europe) ESPRIT (European Specific Programs of Information Technology) JESSI (Joint European Submicron Silicon program) EUREKA (European Research Coordination Agency) Airbus (Mercedes-Benz & British Aerospace, etc) ITC consortia for developing and marketing of IT & communication technologies The term of fair and non-discrimination licensing for necessary patents

Technology transfer crossing industries U.S. Department of defense 1980 Stevenson-Wydler technology innovation act 1986 technology transfer act 1989 national competitiveness & technology transfer act E.g., the 2G CDMA mobile technology

International technology transfer The goose-fleet pattern the international technology transfer from U.S. to Japan, and then retransfer to four Asia Tigers, and Thailand, Indonesia, Malaysia, China, Vietanam, etc. (the TLC model for international technology transfer according to the cost of factors)

Singaporean lessons Government championship Efficient public order and stable political regime Advanced infrastructure Facilitate the establishment of Asian operation center for global corporations

Taiwanese lessons National industrial championship The high flexibility of medium- and small-sized corporations National technological research & incubation center for facilitating technology diffusion evaluation and imitation of technology Focus on the manufacturing capability Science & technology park for fostering the industry cluster Transplanting the deeply absorptive capacity overseas education, training and homing returns

The action-and-reaction between transferor and transferee Information asymmetries The territory exclusion term The obligation of technology feedback the claim of cross licensing The syndrome of not-invent-here The incentive of invention around

The macro view of international technology transfer Counterparts the private enterprises of developed countries, LDs (transferor), vs. the governments of less developed countries, LDCs (transferee) The transferor economic gains of technology by strategically taking the advantage of LDCs (transferees) The transferee the governmental interventions for GDP growth contributed from the expected technology externalities of transfer prevent the indigenous resources and employment from being exploited The processes of technology transfer are more political than economic negotiation

Analysis framework of international transfer of technology LDCs DCs transaction mechanism:.the nature of technology.selection, negotiation, drafting, bonding cost of contracts.legal system for IPR.political stability.social context and cultural congruence.financial and taxation policy.the education level and absorptive ability perceived transaction cost governance structure designing hierarchy market.wholly owned or majority-owned subsidiary (direct foreign investment package).equity joint venture.the contractual joint venture.partnership or strategic alliance.pure contract (licensing, technical assistance).market potential & economics of scale.localized, customized, decentralized vs. globalized, standardized, centralized supply side demand side micro macro

Comparison with technology diffusion and transfer Rogers diffusion focusRobinson's transfer focus Relative advantage Compatibility Complexity Triability Observability Maturity Dynamism Availability Complexity Imitability Relative Importance Environment specificity Scale specificity Firm specificity Factor specificity Product/process Core/peripheral Production continuity types of technology specificity of technology status of art of tech functional degree of tech

Transfer concerning focus Technology transaction mode The nature of technology: general/specific, tacit/explicit, tangible/intangible, mature/emerging, standardized/integrated, product design/process integration The phase of transfer :development/production/marketing Accompanying mechanism payments of transfer: time base or performance criteria installation/operation/profitability measurement of transfer: metering scale and information monitoring Circumstance & context Home country: the policy of leakage/security Host country: the policy of spillover/employment Evolutionary process

Technology absorptive capacity Resource endowment, people talent, education system, path dependence, infrastructure/property law/business managerial practice/social norm Appropriate technology criteria defined by political, social, and economic development and progress Availability of complements: the trade-off between the broadly low-end and the scarce high-end cluster

Extended readings Robinson, Richard (1988), The International Transfer of Technology: Theory, Issues, and Practice, Ballinger Pub Co. Johnson, Chalmers A. (1983), MITI and the Japanese Miracle: The Growth of Industrial Policy, , Stanford University Press.