Search

We consider a market of technology transfer and licensing with an outside innovator and two asymmetric potential licensees where the licensees have asymmetric absorptive capacities of a cost reducing innovation. The low-cost efficient licensee/firm can only benefit from the new technology if the size of the cost reducing innovation is strictly bigger than the cost difference from its competitor. The high-cost firm always benefits from the new technology regardless of the size of the innovation. This leads to the possibility of strategic shelving of the innovation by the efficient firm. Under this backdrop, we characterize the optimal licensing contracts of the outside innovator. We find that in equilibrium, the innovator will use a fixed fee contract for some parameters and royalty or two-part tariff contract(s) for other parameters. Equilibrium fixed fees and royalty rates will also vary depending on the cost asymmetry and the size of the innovation. The optimal licensing contracts can be exclusive or non-exclusive, and shelving of the new technology may or may not happen which has welfare implications. We also investigate the first- and second-best licensing contracts in this environment and discuss their possible implementation. [ABSTRACT FROM AUTHOR]

This study investigates the effect of R&D subsidy associated with R&D projects on the productivity and internal capacities of Korean manufacturing small- and medium-sized enterprises (SMEs). It also addresses the difference in effectiveness attributed to the characteristics of such projects. We constructed distinctive firm-level panel data combining the National Science and Technology Knowledge Information Service and Korea Enterprise Data databases and used stochastic frontier analysis with multivariate matching techniques. The results reveal that subsidised R&D projects did not help Korean SMEs in improving productivity and efficiency. Compared with the control group, which had similar external features, beneficiaries showed worse productivity growth as well as efficiency changes. Moreover, the effects of R&D subsidies differ depending on project characteristics. Specifically, the amount and period of R&D subsidy had a positive effect on catch-up but a negative effect on SMEs' innovation capacity. These results demonstrate the need for renovating the current support system for SMEs' R&D activities in Korea. [ABSTRACT FROM AUTHOR]

This paper examines the changing landscape of GVCs and competition in the global semiconductor industry in the context of new geopolitics featured by the United States implementing "chokepoint" measures to limit the rise of semiconductor manufacturing in China. Overall, the paper finds that these US measures, like the IRA and CHIPS act, will have important impacts on semiconductor GVCs, especially in three types of memory (HBM, DRAM and NAND) and logic chips, and will slow down the speed and process of China's catching up and possibility of leapfrogging. By developing a conceptual framework for analyzing realism-based great power rivalries and national firm responses, we note that lead firms in South Korea and Taiwan can muddle through by reconfiguring their modes of GVCs, which can be summarized as "a bigger capacity and higher-ends in home bases and a smaller capacity and lower-ends abroad." Analyses of US patents show that Korea and Taiwan have maintained their technological superiority in terms of both quantity and quality of their patents, compared to China, whereas Japan has lost its past superiority to China at least in patent quantity. We also find that the pace of China's catch-up is very fast in quantity, but slow in quality in key segments (DRAM, NAND and logic chips), except HBM which is the most recent segment where China has already surpassed Korea or Taiwan in terms of the number of patents. Whereas China has been catching up rapidly in the number of patents, it might encounter problems in turning that into market catch-up given the existing restrictions in accessing complementary technologies and chipmaking equipment, such as advanced lithography machines (EUV) or even more matured technologies (DUV), and software. Severely constrained by these technological entry barriers, the degree of catching up by China tends to be faster in lower-end products by foundry firms (e.g. SMIC), medium to high in NAND memory chips (e.g. YTMC), and slow or difficult in DRAM (e.g. CXMT). In the meantime, China has been making progress in domesticating value chains in diverse equipment and components in chip manufacturing. • Korea and Taiwan have maintained their technological superiority through a strategy of: • Building "bigger capacity and high-ends in home bases and a smaller capacity and low-ends abroad" • China's catch-up is fast in quantity of patents but slow in quality • China's catch-up is fast in lower-end foundry products; moderate pace in NAND chips; slow in DRAM • China is domesticating key value chains in parts and components [ABSTRACT FROM AUTHOR]

This study explores how China's solar photovoltaic (PV) industry can catch up so rapidly without radical technological innovation. Through the grounded theory method, we found it was the industrial innovation ecosystem construction and industrial innovation ecological relationship maintenance that made China's solar PV industry gain competitive advantages. From the perspective of the industrial innovation ecosystem, clustering and colocation provided a foundation for industrial innovation ecosystem construction. China's solar PV enterprises maintain the ecological relationship among the actors of the industrial innovation ecosystem through several ecological strategies, including resource orchestration and co-opetition. Hub firms played an important role in overcoming the liability of newness and putting forward the vision of shared fate in the early stage of industry development. Local governments and industry associations provided institutional support, coordination, and intermediary to enterprises. [ABSTRACT FROM AUTHOR]

Despite exhaustive research on technology upgrading in firms from emerging economies—latecomer firms—we still know little about micro-level learning strategies underlying technological innovation capability accumulation, also known as technology upgrading intensity, particularly in natural resource-intensive industries. Through an empirically grounded study of Brazil's mining industry, which holds a globally leading technological and market position, we found that: (1) leading firms implemented technological learning strategies as responses to changing windows of opportunity (demand, technological, institutional, and idiosyncratic problems); (2) these technological learning strategies manifested in various ways from imitative and defensive to offensive with elements overlapping over the technology upgrading process, involving two forms of knowledge inputs: 'doing, using and interacting' and 'science, technology and innovation', which were operationalised through various learning mechanisms; (3) the use of these learning mechanisms changed qualitatively over time affecting firms' technology upgrading intensity positively. Thus, we further the understanding of latecomer firms' technology upgrading by providing in-depth empirical insights through a comprehensive approach to innovation capabilities and learning strategies in an under-researched natural resource-intensive industry in a middle-income resource-rich country. [ABSTRACT FROM AUTHOR]

Innovation is increasingly decentralized, traded and transferred internationally. Specialized suppliers of knowledge-intensive business services have emerged, enhancing the international transfer of knowledge and technology. This has important implications for the global geography of technological and innovative capabilities. This paper focuses on the role of European KIBS providers for the catch-up process in the Chinese wind turbine industry. Drawing on in-depth studies of three central technology domains in wind turbine research and development, it shows how the recent catch-up in the Chinese wind turbine industry was closely connected to organizational changes taking place in the incumbent wind turbine lead markets in Europe. The paper suggests that access to knowledge through KIBS can unlock rapid but bounded latecomer development in emerging markets. [ABSTRACT FROM AUTHOR]

This paper sets out to understand the use of public procurement as a policy instrument for catching up. Brazil and China, who have explicitly linked procurement to innovation, are used as empirical cases. We review their respective institutional settings, policy approaches, and micro-level processes related to the public procurement of innovation (PPI). We have discovered that they share similarities concerning issues encountered during PPI implementation. Although both countries have made some achievements in promoting innovation through procurement, this paper highlights some of the obstacles they have experienced when implementing this policy, such as institutional problems, changes in the political landscape, and macroeconomic constraints. Such obstacles, more prominent in the case of Brazil, may have acted as an obstruction to achieving the pursued objectives, thereby restricting the full potential of PPI in driving technological catching up. The article then offers managerial and policy implications for the implementation of PPI, such as the importance of choosing relevant procurement procedures, critical roles played by policy champions, and demonstrating effects of leading firms and regions. While in China PPI was once an instrumental part of its technology development agenda, in Brazil it has been sporadic and unconnected to a given national strategy. [ABSTRACT FROM AUTHOR]

Using Huawei as an example, this paper analyses the catch-up process of latecomers from emerging markets during their transition towards global technological frontiers. We designed innovative indicators using USPTO patent data and used them to measure Huawei's catch-up in an established and an emerging technology field. We measure overall innovation capability (OIC) and core innovation capability (CIC), benchmarked against global forerunners, during its transition to industry leadership. Our findings indicate that Huawei built its OIC ahead of CIC. However, the effectiveness of its catch-up in CIC determined whether the latecomer firm achieved the leadership transition. Our findings make an important contribution to catch-up theory and carry significant implications for catching up firms and incumbent firms. [ABSTRACT FROM AUTHOR]

Technological advancement is a dynamic and complex process, and successful technological upgrading can promote an enterprise's overall competitiveness. Despite that there have been abundant and vibrant firm-level studies on technological upgrading,an integrated framework is still needed to thoroughly cover the overall process of a firm's progression from technological new entrant to innovative leader. In this paper, a firm-level conceptual framework is proposed to analyze the technological upgrading process of new entrants from newly industrializing economies. We classify the technological process into two patterns: the continuous pattern involving three stages of effort (i.e., technological imitation, technological catch-up, and technological overtaking) and the discontinuous pattern of technological leapfrogging. For each stage, we analyze activities that firms undertake and the four closely related drivers for further technological upgrading, including abilities acquired, problems encountered, windows of opportunity, and enterprise willingness. Furthermore, we synthesize some significant transitions in the continuous process of technological upgrade, namely, a firm's changing role in the industry-wide technological advancement, the feature of production, the firm's innovation ability, the locus of problem solving, and the position in the global value chain. The practical implications of the proposed framework and future research expectations are also discussed. [ABSTRACT FROM AUTHOR]

The technological catch-up behaviour of latecomer firms has been a topic of interest for the past three decades, especially in emerging economies, such as China and India. However, little research has systematically discussed the capability-upgrading issue that firms face in the context of open innovation, and the previous work lacks an explanation for why some Chinese firms can win competitive advantages in the global market within a short time. This study develops a PDSE (Position-Depth-Scope-Efficiency) framework of systemic catch-up to explain the process and mechanism of capability upgrading by using the literature on technological catch-up, open innovation, and the capability reconfiguration view. We conduct a multiple-case study based on three top home appliance manufacturers in China– Haier Group, Midea Group, and Gree Electronics. The results show that firms can achieve better positions, depth, and scope of catch-up with higher efficiency in the open innovation era. The process of systemic catch-up moves from component capability to architectural capability and then to systemic capability, while four mechanisms based on market and technology reconfigurations are effective in promoting capability upgrading. Overall, a key contribution of this paper is the offering of a new conceptual framework of systemic catch-up to outline the changes in the capability-upgrading process over time. This framework adds to the previous research that is mainly limited to the entry and gradual catch-up stages of capability development and deepens the understanding of the competitiveness of emerging economy firms beyond cost and scale advantages. • Latecomer firms achieve greater position, depth and scope of catch-up with higher efficiency in the open innovation context. • The position of catch-up is related to available resource endowment helping to upgrade capabilities. • The depth of catch-up reflects capability deepening along the core-periphery dualism in specific technology or market. • The scope of catch-up estimates the capability broadening spanning organizational, technological and market boundaries. • The efficiency of catch-up is about the time required for capability upgrading in different stages. [ABSTRACT FROM AUTHOR]

The paper deals with issues concerning latecomers’ industrial catch-up. Using the recent development of hackathons as an example, this study explores how actors in an emerging economy manage to enhance innovation capability through certain events. Based on qualitative studies on the innovation activities and outcomes within major hackathons in Taiwan, this paper argues that, thanks to the unique environment and settings of hackathons, industrial actors in Taiwan are able to not only obtain resources and stimulus to facilitate their production of and investments in innovation, but also to improve local institutions for innovation. In addition to demonstrating the nature of these latecomers’ enhanced innovation capability, we also explain key mechanisms contributing to hackathons’ specific innovation dynamisms. [ABSTRACT FROM AUTHOR]

The aim of this study is examining Korean In Vitro Diagnostics (hereafter, IVD) companies' catch-up with established medical device companies by analyzing the process of sensing, seizing, and reconfiguration during the Corona Virus Disease 2019 (hereafter, COVID-19) pandemic. The potential catch-up of medical device companies in Korea has long been known as a demanding goal due to the conservative nature of the industry. While the rise of latecomers in industries such as mobile phones and automobiles is often observed, such a rise is rarely found in the medical device industry. Korean IVD companies have consistently been aiming at overtaking the existing leaders in the industry by pursuing technological innovation backed by active R&D investment. While the extant research on the topic of catch-up is enriched, there are small number of studies on the topic of the catch-up of medical device companies. This study focuses on understanding how two Korean IVD companies, SD Biosensor and Seegene, achieved meaningful catch-up during the COVID-19 pandemic. To understand the specific catch-up during the pandemic, this study adopted case study as a suitable method to examine the interactions between the pandemic and the device companies. The study results suggest that Korean IVD companies achieved significant growth by fully leveraging their dynamic capabilities in terms of market sensing (the emerging market dynamics associated with COVID-19) and opportunity seizing. [ABSTRACT FROM AUTHOR]

This paper aims to answer an important question: whether and how, in emerging markets, latecomer firms with limited technological endowments can catch up with industry incumbents that dominate the technological and market frontiers. Adopting the perspective of demand-side dynamics and analyzing the case of China’s mobile handset manufacturing industry between 1998 and 2008, the paper finds that in emerging markets, latecomer firms with limited technological innovation capability are able to achieve market share catch-up by using effectiveness-centered business model innovation. Specifically, business model innovations that provided the most effective (though not necessarily the most efficient or novel) solutions to cater to changing customer preferences were the winners in helping latecomers achieve catch-up. [ABSTRACT FROM PUBLISHER]

The dynamics of the corporate-level performance growth can reflect the pattern of the firms' reaction at the financial crisis moment. We employed the generalized metafrontier Malmquist productivity index to measure the impact of the financial crisis on the productivity of the biotechnology industry by using 68 biotechnology firms in the Asia-Pacific countries during 2001-2009. The empirical results showed that the financial crisis did not significantly impact productivity changes in the biotechnology industry in the Asia-Pacific region. This was primarily due to the improvements in efficiencies of scale and factor inputs reducing the overall impact. We observed a significant decreasing trend for technical changes in developed countries after the financial crisis. Therefore, how corporations enhance their technical innovation ability is relatively critical. The technological catch-up, the potential technological relative change, and the change in technical efficiency in less-developed countries were poor after the financial crisis. This suggests that less-developed countries should improve their technical and efficiency levels to enhance productivity. [ABSTRACT FROM AUTHOR]

The telecommunication system industry has long been dominated by the Swedish giant, Ericsson. Huawei, a newly emerged firm from China, entered the industry, grew rapidly, and finally overtook Ericsson in terms of sales in 2012. Given the rarity of this phenomenon, this study seeks to explain how this became possible. We first verified that Huawei's market share catch-up is rather owing to its technological capabilities than its cost advantages. Then, our analysis of the European patents shows that Huawei grew rapidly by developing technologies that are different from those of Ericsson, and that the former relies more on recent and scientific knowledge in its innovation strategies. This study suggests that creating one's own technological path rather than following the path of the incumbents could be a viable strategy for successful technological catch-up. [ABSTRACT FROM AUTHOR]

The role of knowledge accumulation and technological progress is well recognised in the growth literature. However, the developing countries have limited capacity for innovation and they mostly benefit from imitation and knowledge spill-over from the developed countries. Studies emphasized on the role of human capital in imitation and technological catch-up process of the developing countries. For empirical analysis of the catch-up hypothesis, existing literature generally considered USA as the technological leader to which other countries tend to catch up. However, it remains an open question whether USA is the only candidate to be the technology leader. The paper re-examines the human capital based technological catch-up hypothesis exclusively for the developing countries with alternative possibilities of technological leader. Our study investigates for the potential technology leader by estimating a structural growth equation suggested by Benhabib and Spiegel (1994) using panel data from 75 developing countries. Considering the possibility of endogenetiy problem of capital accumulation, the paper used an instrumental variable technique for estimation. Our results show that when USA is used as global technological leader, or different single countries are used as technological leader of the developing countries in different regions, the estimated structural equations fail to find any positive role of technological catch up in economic growth of the developing countries. However, when OECD countries collectively, or major trading partner of developing countries with higher income are considered as technological leader, we find a strong evidence of technological catch up. The findings have few policy implications for developing countries. As group of developed countries can serve better as a technological leader in the catch-up process of the developing countries, the latter should extend economic relations with many developed countries instead of relying on economic ties with one or few countries. Moreover, trading with developed countries may be more beneficial for developing countries in terms of potential dynamic gains of trade as it exposes the country to higher level of technology and creates a scope for imitation. [ABSTRACT FROM AUTHOR]

This study investigates catch-up in the form of knowledge creation of firms in emerging markets by stressing two distinct types of search behaviors of an organization - horizontal search and vertical search. Based on an empirical analysis of 204 Chinese firms, this study provides new theoretical insights into and practical implications by emphasizing that in order to catch-up, firms in emerging markets should adopt idiosyncratic search strategies different from those of firms in more advanced countries. The regression results show that due to their under-developed absorptive capacity, firms in emerging markets should avoid searching in diverse knowledge fields, as established large firms in advanced countries are encouraged to do, in order to innovate successfully. Our findings also suggest that searching for recent and emerging knowledge helps firms in emerging markets overcome their learning curve disadvantage in the process of catch-up. [ABSTRACT FROM AUTHOR]

Common innovation performance measures, which are based on research and development activities, are not relevant to dominant innovation behaviour of developing countries. The main functions of the innovation system of developing countries are capture, imitation, learning by doing and diffusion of knowledge, to reduce technology gaps with technology frontiers. Hence, the purpose of measuring innovation performance in a developing geographical area should be the evaluation on its success in technological learning and catching-up. Using the learning and technology gap concepts, in this paper we develop a novel model of measuring innovation performance of developing countries/regions, based on common regional statistics. In the virtual absence of mandatory firm level surveys, this model can provide a useful method to compare the innovation behaviour of regions for policymaker. Running the model with the data from the Iranian provinces, the paper concludes each province has its own specific innovation behaviour stemming from different historical development paths and geographical characteristics. [ABSTRACT FROM AUTHOR]

Based on a categorization of technological change, this paper proposes three patterns of catch-up: incremental, disruptive and revolutionary. Variations in innovation forms within the three patterns of catch-up are analyzed using Chinese firm-level survey data. The innovativeness of firms evolve following an inverted U-shape in the case of the incremental pattern of catch-up, while that evolve following a linear relationship rather than the N-shape proposed by theory for the disruptive form of catch-up. In the case of the revolutionary pattern of catch-up, the evolution of innovativeness of firms follows a steep inverted U-shape indicating more significant changes than that involved in the incremental pattern. [ABSTRACT FROM AUTHOR]

This paper analyzes the market and technological catching-up of latecomer firms in two IT service sectors from a sectoral systems of innovation (SSI) perspective. It finds that indigenous software firms in China have selected different learning and catch-up strategies in the different technological regimes. For the online game sector where imitation is easier and incremental innovation is more important than radical innovation, these Chinese firms started with handling the publishing (or distribution) of games developed by foreign incumbents, and later on secured in-house game development capabilities by imitating the products of global leaders. In the applied software sector where both imitation and creative innovation are difficult, Chinese firms attained third-party technologies through M&As, and then differentiated their products by taking advantage of local specificities. However, such learning and acquisition would not have led to commercial success without government regulation against foreign companies, such as business restrictions in online games and exclusive procurement for indigenous products in applied software. Thus, this study underscores the importance of government and regulations in playing the role of "artificially opening" another window of opportunity for latecomers. [ABSTRACT FROM AUTHOR]

The existing literature has not studied the role of basic research in industrial catch-up in developing countries in any depth. This article takes high-speed rail as a case study in order to show how basic research has helped the industry to master imported technology and produce secondary innovations. The role of government is important in terms of coordinating the process of technology importation, digesting imported technology and innovation. The role of the home market is also very important in an era of globalisation to promote innovation in this emerging industry. [ABSTRACT FROM PUBLISHER]

This paper provides the theoretical guide and introduction to a selected list of papers evaluating the drivers of technological catch-up experiences from Asia. It departs from neoclassical preoccupation with markets as the sole or dominant institution of economic allocation by arguing that the evidence supports the evolutionary logic of macro, meso and micro interactions between several institutions, depending on the actors involved, structural location and taxonomic and trajectory elements of technical change. [ABSTRACT FROM AUTHOR]

The emergence of latecomer firms from East Asia in high-technology sectors is one of the most striking phenomena of world economy in the past decades. However, while most literature focuses on the catch-up of Korea and Taiwan, we know relatively little about the practices in China, especially the firm-level experiences. Based on in-depth case analyses of three Chinese ICT firms from exploratory and evolutionary perspectives, we attempt to locate the window of opportunity for Chinese ICT firms to catch up with forerunners and identify strategies they employed to seize the window of opportunity. Our research findings suggest that paradigm shifts provided these latecomers with an opportunity to penetrate the market and universal standards or new technologies from other domains serve as the window of opportunity for latecomers to surpass forerunners. This study also reveals that technology-market combination as well as other strategies including niche market proposition, service innovation, collaborative R&D and leveraging complementary technologies can be utilized as effective approaches to realize catch-up. [ABSTRACT FROM AUTHOR]

For industries in undeveloped countries, technological paradigm transition means both opportunities and challenges. This paper examines the technology evolution process of the color TV industry in China across two areas: CRT (cathode ray tube) and flat panel display. In order to delineate the evolution path, a theoretical model is proposed in which six influencing factors, namely, firm strategy, demand, resource supplying, policy/regulation, technology paradigm/technology regime and industry structure, are examined. These factors jointly determine the evolution process of the color TV industry in China. This model clearly explains the industry's backward position, in comparison with that in leading countries. [ABSTRACT FROM AUTHOR]

This paper looks at interesting stories of catch-up in the automobile and mobile phone sectors in China. It assesses the two sectors from the sectoral systems of innovation (SSI) framework. Among the building blocks of the SSI, the focus has been on the regime of technologies and knowledge, such as modularity, degree of embodied technical change, tacit knowledge, knowledge access, and frequency of innovations. According to this framework, indigenous automakers in China have been making a quick catch-up upon entry because the auto sectors tend to feature a higher degree of embodied technical change and increasing modularity in many components. However, their long-term destiny is sill uncertain given the considerable tacit knowledge in the sector and critical importance of integration capability. In mobile phones, early catch-up by indigenous Chinese makers and more recent setbacks are also explained. Early catch-up was possible owing to the high modularity of production and availability of a knowledge pool around the nation. The long-term prospects of this sector might be brighter than that of automobiles owing to high explicitness of knowledge of the sector. But a remaining bottleneck for Chinese makers might be the higher frequency of innovation which poses some challenge to late-comers. In addition to the regimes of technologies and knowledge, the paper also looks at the market regimes and the role of government in explaining the two industries in China. [ABSTRACT FROM AUTHOR]

This paper uses sectoral systems of innovation framework to examine the relationship between technology policy and industrial development by comparing the emergence of the wind energy industry in Denmark and India. Since the late 1970s Denmark has led the development of a global wind energy industry and in 2004 wind energy supplied 18.8 per cent of Denmark's electricity consumption. India was however a late entrant that managed in a few years to establish itself as the fifth largest producer of wind energy in the world. We suggest that India's unique policy of “interactive learning” with international and especially Danish actors, instead of imitation of foreign technology policies and institutions, was a substantial contributor to India's success in developing their wind energy industry. [ABSTRACT FROM AUTHOR]

This paper deals with the question of why making a catch-up is even more difficult in capital goods industries that are usually led by small or middle-sized companies. It relies upon the sectoral systems of innovation as a theoretical framework for analysis. From the findings, the paper has identified three sources of difficulties in the catch-up of the capital goods industry, particularly in machine tools. First, while small firms in the capital goods industry are usually specialized suppliers to big final goods assembly firms in the consumer goods industry or other industries, and thus the tacit knowledge accumulated from the interface between the producer and the customer firms is very important, a serious difficulty lies in the fact that local client firms are reluctant to use locally made capital goods due to their poor quality and low precision level. Second, while a successful catch-up first requires the ability to produce goods of better quality and lower prices than those produced by incumbent firms from advanced countries, a typical difficulty arises because incumbent foreign firms often react by charging predatory prices upon news of the local development of capital goods by latecomers. Third, if the catch-up firms overcome this barrier, then the next strategy used by incumbent firms is to charge latecomers with legal actions for patent violations. Despite these intrinsic difficulties, the Korean economy has achieved a very slow but gradual catch-up in the capital goods industry. The paper has attributed such achievement to several factors, including the strenuous efforts of the government, niche markets in general-purpose machine tools and emerging economies, and finally, the increasing introduction and adoption of information technology (IT) or digital technologies in machine tools. Furthermore, the three sources of barriers to catch-up imply that any latecomer firms that wish to record a successful catch-up should have these barriers in mind from the beginning of the road towards catch-up. We observe that a successful catch-up requires the ability to produce goods of better quality and lower prices than those produced by incumbent firms from advanced countries. After the initial success, they should also be well prepared against eventual or possible attacks by the incumbent firms in the forms of predatory pricing and intellectual property rights (IPR) charges. [ABSTRACT FROM AUTHOR]

Summary: China and India have become major producers of products and services for global markets. This article explores to what extent they are also building up innovation capabilities. It draws on a combination of approaches—innovation systems, global value chains and professional networks—to analyze four of the most dynamic industries. We find that mounting innovation efforts only rarely materialized in cutting-edge innovations but suggest that if capital accumulation proceeds at the current pace, innovation capabilities will rapidly be built up in China and, with a time lag, India. We conclude by setting out the implications for both the developed and the developing world. [Copyright &y& Elsevier]

The rapid pace of globalization has increased the desire of many developing countries to catch up on the developed ones as quickly as possible. The reality, however, is that the gap between the poor and the rich has widened over the years. This article takes up the case for building technological competitiveness as the way forward for developing countries to face the 'catch-up' challenge. Technological competitiveness is conditional on three key factors - access to competitive technology, continuous innovation of soft technology and provision of a soft environment or macro environment system (including a hard environment and a soft environment) that is favourable for innovation. The article attributes the gap between developed and developing countries mainly to differences in soft technology and soft environment. [ABSTRACT FROM AUTHOR]

This paper addresses the issue of catching and convergence at the level of firms, and investigates whether Korean firms tend to converge toward mature firms represented by the US firms in terms of their behavior and performance as well as firm-level innovations systems. It conducts regression analyses of several behavior and performance variables, using the data of the Korean and US firms during the 1990s, the 2000s, and 2010s. It finds some evidence of convergence, such that Korean firms become more profitability- rather than growth-oriented, borrowing and investing less, and thus being less indebted. However, they have not changed much in terms of their behavior toward firm values and dividend tendencies. Further analyses, using the patent-derived, innovation system variables, also confirm some aspects of convergence, compared with the early results, for which self-citations become significant and positive for firm values; furthermore, the variable of cycle time of technology is no longer significant for profitability, which is consistent with the results from the US firms. Meanwhile, changes in corporate governance associated with the rise of foreign shareholder are also shown to have resulted in higher profitability but insignificant change in firm values. An emerging conclusion is an ongoing but partially completed process of convergence. [ABSTRACT FROM AUTHOR]