Dynamics of Industry and Innovation: Organizations, Networks and Systems

This paper seeks to contribute to the debate relative to industrial technological capability building in association with changes into a liberalised and globalized economic regime implemented from the early 1990s in several late-industrialising countries. During the past few years certain generalisations have held that such policy changes had a pervasive negative impact on industrial technological capabilities in Southern Latin American countries, particularly in Brazil. Such issue is examined here in three sets of manufacturing firms in the Industrial Pole of Manaus (Northern Brazil) a total of 46 firms. The paper draws on first-hand empirical evidence collected through extensive fieldwork. The technological capability of most foreign subsidiaries and local firms, far from being static and confined to basic levels, have been upgraded to carry out diverse types of innovative activities. These capability levels are strongly associated with local decision-making and control. Inter-firm technological learning links have contributed to building such capability levels. Exporter firms are those with deeper capability levels. At least within the sample scrutinized in this study, firms have been responding to a fast pace of globalisation, trade liberalisation, and outward-looking industrialisation by deepening their capability levels and increasing exports. The findings do not point to a pervasive erosion of technological capabilities and low industrial dynamism as a result of changes in policy regime. Nevertheless, more space in the government policy agenda should be given to industrial strategies to accelerate firms move into deeper technological capability levels.

  • Authors: Paulo N Figueiredo
  • Year: 2005
  • Organisation: Danish Research Unit for Industrial Dynamics
  • Publisher: Getulio Vargas Foundation/EBAPE
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