Knowledge flow in low-carbon technology transfer: A case of India's wind power industry

Abstract

The degree of knowledge flow in low-carbon technology transfer is influenced by its organizational mechanism. While transfer mechanisms involving greater cross-border interaction and recipient effort may provide more learning opportunities, there remains a gap about the causal mechanisms and contingent variables involved in technology transfer and technological capability development. This study offers one of the first firm-level causal analyses of transfer mechanisms and technological capabilities, taking into account various firm- and context-specific factors. To this end, India's wind power industry is analyzed using firm-level data and semi-structured interviews conducted in 2013 with 15 wind turbine manufacturers covering 76% of the market share and 12 other organizations working on wind power. The analysis demonstrates that innovation capabilities are accumulated mainly through transfer mechanisms enabling recipients’ engagement in research and development. Mergers and acquisitions as well as international research and development centers are among the most effective examples. Joint ventures could be appropriate if a local partner gains a large majority shareholding. The knowledge transfer through wholly foreign-owned enterprises may be restricted because intellectual properties are tightly controlled by their parent firms. The creation of a predictable, performance-oriented market enhances firms’ financial resources and consequently encourages knowledge acquisition and capability development.