Some advice for countries that are lagging behind in technological development
Several of Europe’s economies stand at the frontier of technological development; that is, they’re able to produce technological breakthroughs of global significance. Although some other economies are lagging behind, it’s well documented that those economies which adopt a “catch-up” strategy can achieve substantially higher growth rates than their frontier counterparts.
They can catch up, for instance, by increasing their ability both to absorb existing ideas, knowledge and technologies, and to imitate the existing products, production technologies and business models in the frontier economies.
For frontier economies, economic growth critically depends upon their ability to add new knowledge to the research frontier. In catch-up economies, though, it depends upon their capacity to absorb state-of-the-art ideas, knowledge and technology from frontier economies; that is, on their ability to imitate. Clearly, then, these should not, in the medium term, invest their limited resources in trying to add to the research frontier.
How, then, can they increase their imitation capacity?
The general advice is that they should raise their overall absorption capacity. They should invest in language training, particularly English, and engage heavily in international student exchange. They should stimulate the mobility of researchers and promote cooperative R&D programmes. They should secure knowledge accessibility via high-capacity broadband and access to high-quality databases. They should remove import barriers, in particular for knowledge-intensive and high-tech products. They should encourage investments by foreign multinational firms. They should improve international communication and transportation infrastructure. They should encourage well-educated nationals living abroad to return home.
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