Technological Catch-up Research Articles

Lessons learned from an unsuccessful “catching-up” in the automobile industry of Iran

In contrast to existing studies mostly investigating successful cases of technological catching-up, this paper aims to analyse a limited catch-up by an Iranian automobile firm. Using thematic analysis, and based on the conceptual framework developed in the literature review, the empirical data were coded and categorised into the themes and dimensions. The resulting contextualized framework, as one of the main contributions of this study, suggests how the certain sectoral environment of the automobile industry contributes to the lackluster performance of catching-up by the domestic firm. The sectoral environment (i.e. technological regimes, market regimes, and government policies) of Iran's automobile industry (IAI) is characterized by ineffective technology transfer, diverse technological areas, high tacit knowledge, the extensive backward linkages, high scale intensity, under-developed domestic supply chain, capital-goods attitude to the consumer goods, the oligopolistic structure, and homogeneous market. This paper also identifies new catch-up's influencing factors (i.e. industrial strategy and structural issues) inductively emerged during the empirical data analysis. And finally, comparison of the automobile industry in Iran and a few Asian countries shows that local content requirements (LCRs) will not bring about indigenous development unless it is complemented by the export market discipline and scale economy.

A Research on Digital Transformation: Integration Framework and Prospects

Digital transformation is a process that starts from the infrastructure of digital technology, digital products and digital platform, and then leads to changes in individual, organizational, industrial and other levels. With the development of artificial intelligence, big data, 5G and other emerging technologies, digital transformation is impacting and subverting the existing technology path and organization mode. The Report of the 19th National Congress of the Communist Party of China also proposes to promote the deep integration of digital technology and the real economy, accelerate the construction of digital-driven new industrial ecology, and urge all subjects to continuously explore the transformation mode. This phenomenon has aroused widespread concern in the academic and practical circle. The existing research mostly focuses on the formulation of digital transformation strategy, the relationship between digital technology and organizational performance, management adaptability and the change of business model. However, the impact and value of digital transformation have not been systematically integrated and summarized. Besides, it is still a problem for enterprises to deal with the challenges in digital transformation in order to obtain new competitive advantages while the existing theory cannot give systematic guidance. In view of this, this paper picks out 101 existing literatures from databases like Web of Science, Science Direct and CNKI. Then, the definition of digital transformation by scholars at present is summarized from two dimensions of technical support and organizational change. The existing research content of how to measure the completion of the transformation in a quantitative way is also summarized. On this foundation, the definition in this paper is put forward. This paper explains how the infrastructure including digital technology, digital products and digital platform can be used as the starting point to support and promote the transformation. In addition, it explores the introduction cost, subversion and upgrading of technology, the availability of products and how to provide innovative services, the multi-party interaction, information integration and business scope of the platform, etc. Moreover, this paper explores the multi-level changes in the process of transformation from three levels: individual level, organizational level and industrial level. The individual level mostly discusses the change of senior executives’ role, job creation and job destruction. The organizational level mostly studies the impact on organizational structure, ability and strategy. The industrial level mostly summarizes the change of business model and value chain. It summarizes the positive and negative effects of digital transformation. On the one hand, the transformation promotes the production efficiency and organizational performance. On the other hand, it poses a threat to privacy security and employee employment. In the next part, this paper puts forward the future research direction of digital transformation and the problems that should be paid attention to in the context of digital transformation in China. Firstly, scholars should explore the problems of technology, resources, platform construction in the starting point of transformation. Secondly, more research on the driving mechanism, dynamic development mechanism and resource integration ability in the process are also needed. Thirdly, how to deal with the threats and challenges brought by digital transformation is still not a fully-solved problem. With the unique context in China, more attention should be paid to the following research topics: the technological catch-up path of manufacturing enterprise as a latecomer, how the government, enterprises and society can develop harmoniously under the situation of digital industrialization and industrial digitization, the construction and mechanism of ecosystem as well as the solutions for Chinese enterprises to face the unique challenges. Finally, in the conclusion part, the integration framework of digital transformation theory is summarized from the three aspects of the starting point, process and result. This not only helps to systematically sort out the knowledge context of digital transformation, grasp the development trend of theoretical frontier, promote the in-depth development of research in this field, but also can effectively combine theory and practice, and provide reference for Chinese enterprises to formulate and implement effective digital transformation strategy.

International knowledge interactions and catch-up. Evidence from European patent data for Chinese latecomer firms

International knowledge interactions constitute channels of knowledge transfer that finally promote technological catch-up. Accounting for the differences in knowledge dimensions and knowledge interactions, catching-up firms are provided with different types of learning opportunities. In the context of catch-up of emerging economy firms, the empirical evidence considering these differences is rather scarce. Using a cross-section of European patent data, we investigate the effects of different types of international knowledge interactions on the quality of knowledge captured by Chinese firms’ patent applications. We differentiate between lower vs. higher levels of learning and explore the technological learning process of Chinese firms over a period of 15 years. We find that international knowledge interactions are associated positively with knowledge quality. In the earlier phases of the catch-up process, knowledge interactions providing lower levels of learning are associated with a higher quality of the knowledge generated. Whereas knowledge interactions with the opportunity for higher levels of learning are correlated with a higher quality of the generated knowledge in later phases of the catch-up process.

Recovery experiences of the Russian economy: The patterns of the post-shock growth after 1998 and 2008 and future prospects

The global economy is in recession due to the pandemic of the coronavirus infection COVID-19. Russia’s GDP in 2020 fell by 3.1% in relation to the level of 2019, so that the decline was more moderate than in 1998 (–5.3%) and 2009 (–7.8%). In the coming years, the Russian economy will have to recover and enter a new long-term growth path. At what expense and in which industries will this happen? Based on the experience of previous crises and using industry accounts of economic growth and Russia KLEMS data, we have examined possible sources of recovery of the Russian economy after the crisis of 2020. By analogy with the recovery after 2008—2009, it is likely to be associated with increased demand for raw materials on world markets and the reaction of the Russian oil and gas complex. Stagnation after 2008—2009 is due to a decrease in production efficiency, especially in the expanded mining complex (EMC), as well as the cessation of technological catching-up. Growth stimulation measures should include increasing the efficiency of the EMC, providing the adaptation of advanced technologies, and preserving existing adaptation channels in times of crisis — for example, successful export-oriented industries integrated into global value chains. In the long run sustainable growth assumes diversification of the economy.

Motivation Structure and Capacity Building of Technological Catch-up: Experience and Policy Implication of China’s High-speed Rail

In recent years, China's high-speed rail network (HSR) has experienced remarkable growth. This article uses a novel way to define HSR and to investigate the relationship between HSR and tourism development in China. The preliminary findings show that the expansion of HSR has greatly contributed to people's mobility choices, strengthened city-to-city relations and improved social development. Meanwhile, its negative impact on China's environmental impact should also be taken into account. It is demonstrated that cities located in the inland areas benefited more for tourism development induced by HSR compared to their coastal or regional central counterparts. However, the popularity of tourism attractions and the richness of tourism destinations are not so important, suggesting that the demand for leisure and vacation is gradually replaced by sightseeing in the relatively more remote areas thanks to the time-space compression effect of HSR. The research findings in this article strongly support China's effort in developing the country's HSR network which is connecting the vast majority of the prefecture-level cities as far as tourism development is concerned.

Latent heterogeneity to evaluate the effect of human capital on world technology frontier

Although human capital has been recognized as playing important role in spurring productivity growth, its empirical effect remains ambiguous due to the possibility of latent heterogeneity. To reveal the impact of this important driver of economic growth, we propose an alternative empirical methodology, robust frontier in non parametric location-scale models for accommodating simultaneously the problem of model specification uncertainty, latent heterogeneity and cross-section dependence in modelling technical efficiency. We estimate a nonparametric frontier model to define the world technology frontier of 40 countries over the period 1970–2007. Conditional versions of the frontier enables us to investigate the effect of external factors on the production process. One of these factors will allow to measure the openness of the economy of the country and the second will be this latent factor of heterogeneity linked to the absorptive capability and hence to human capital of the country. We have to adjust the methodology to take into account the panel structure of our data set, i.e., handling the time dimension and the cross-sectional dependence affecting the process. Our findings prove that human capital plays an important role in accelerating the technological catch-up (increase in the efficiency) but not on the technological changes (shifts in the frontier). This result seems to confirm the theoretical hypothesis that countries benefit from new technology (technological catch-up) only when they have the ability to exploit it, hence only when they have high level of absorptive capability.

The effects of climate change on African agricultural productivity growth revisited.

This paper analyzes the effects of climate change on African agricultural total factor productivity (TFP) growth and test whether agricultural TFP levels are converging in the region. The study uses cross-country balanced panel data covering 35 countries from 1981 to 2010 and a technological catching-up model based on the Ricardian analysis estimated by Feasible Generalized Least Square (FGLS) regression. Historical country-wide rainfall and temperature are climate factors included in the model. Education, capital intensity, and arable land equipped with irrigation are other potential confounding variables in the regression. The empirical results show that levels of African agricultural TFP are converging over time, though the rate of convergence appears relatively slow in the region. We also find that rain significantly increases agricultural TFP growth, but temperature does not affect the study's African agricultural TFP growth. Other results show that education, capital intensity, and arable land equipped with irrigation significantly increased agricultural TFP growth.

China’s leadership in the hydropower sector: identifying green windows of opportunity for technological catch-up

Abstract From the sectoral systems of innovation perspective, the windows of opportunity (hereafter referred to as WoOs) for industrial latecomers to catch-up could be opened up through abrupt changes in the technological, market, and institutional dimensions. Existing literature discusses different dimensional changes in isolation. Nevertheless, for green industries, the systemic interplay of these dimensions is of key importance; yet few studies have probed into this. These limitations in the literature are largely rooted in the lack of novel methods to detect and specify these abrupt changes, especially in a quantitative way. This paper, therefore, proposes a framework combining natural language processing methods with experts’ knowledge to detect these abrupt changes—named turbulences—by using multi-source heterogeneous data, in order to better identify the co-occurrences and interactions of turbulences across the technological, market, and institutional dimensions that have a high probability to open up WoOs. We apply this framework to analyze China’s hydropower sector as a case study. The hydropower sector is considered a “green” energy sector, in which China, as this study finds, has recently gained technological leadership. By analyzing the interactions between these multiple dimensions of WoOs, we discover that institutional turbulences proactively intertwine with other turbulences, and collectively form Green WoOs for the successful catch-up of China’s hydropower sector.

A dynamic multi-sector analysis of technological catch-up: The impact of technology cycle times, knowledge base complexity and variety

This article contributes to the ongoing debate about whether, how, and under what conditions latecomer countries can become producers of new technology and innovation, thereby catching up with technological leaders. Recent work on sectoral systems of innovation and in the evolutionary economics literature suggests that successful latecomers can move into new technological or industrial domains. They specialise in domains that present more frequent windows of opportunity, shorter technological cycles, flatter learning curves and easier access to relevant knowledge than others. This study investigates the role and significance of two hitherto neglected dimensions of technological regimes that might influence technological catch-up, namely, the degree of complexity and variety of an industry's knowledge base.The impact of technological variety and complexity on catch-up dynamics is tested in three industries – upstream oil/gas, wind power and solar energy – over the period from 1980 to 2016. First, we find that increased knowledge base complexity and related (as opposed to unrelated) variety play a substantial role by hindering the latecomers’ attempts to catch up with technological leaders within each industry. Second, we confirm that other dimensions of technological regime are relevant. Specifically, we find that the length of the technological cycle is important, although a nuanced picture emerges regarding the direction of its impact on catch-up when results are compared across the three industries. These results offer new insights into the technologies and industries in which latecomer countries can specialise in order to develop their innovation capacity.

Did Western CEO Incentives Contribute to China’s Technological Rise?

We study the role of Western CEO incentives in fostering the technological rise of China. Due to China’s quid pro quo policy, foreign multinationals face a trade-off between the short-term benefits of accessing China’s vast market and the long-term costs of transferring technology to China. Leveraging microdata on the global patent network, we construct novel measures to describe technological interactions between US firms and over 70 countries. We find that firms managed by myopic CEOs form more partnerships with China and transfer more technology to China. These firms subsequently lose R&D human capital to China and face more patenting competition from China, suggesting negative long-term consequences in innovation. The results reveal an important real effect of CEO incentives and highlight a novel channel behind China’s technological catch-up.

The imperative of research and development in Nigeria: lessons from the COVID-19 pandemic

The advent of the coronavirus disease (COVID-19) threw the world into pandemonium as most countries were unprepared for its sudden outbreak. Industrialised countries swung into action by applying technology to monitor COVID-19 cases while accentuating research and development (R&D) activities to develop COVID-19 vaccines and drugs. However, Nigeria has not significantly contributed to global research efforts aimed at addressing the challenges posed by the pandemic. This paper applied a case study approach and situational analysis to examine the state of R&D in Nigeria relative to other economies. The paper goes on to investigate the impact of COVID-19 on Nigeria's health sector and the economy at large while emphasising the imperativeness of R&D in effectively handling future outbreaks and, thus, achieving economic and technological catch-up. This study revealed that Nigeria remains a laggard in R&D spending as well as R&D activities, particularly in the health sector as exposed by the recent COVID-19 pandemic. This further reinforces the imperative for Nigeria to significantly and urgently increase its R&D spending not only to combat subsequent health challenges but also to facilitate rapid structural transformation and economic development.

Driving forces of solar energy technology innovation and evolution

This paper aims to provide an overview of the innovation and evolution of global solar energy technology (SET) and further analyze the driving forces. It addresses the evolution from a longitudinal perspective throughout more than 150 years, and discusses the multiple and interactive driving forces in the process of SET innovation. Our study encompasses three theories, including demand-driven theory, science advancement and technology catch-up theory. We retrieve patent data from PatSnap, a global patent platform, and obtain 313,530 hits in total worldwide, published from 1867 to 2018. Through employing the functions of cell diagram analysis and geographic territory mapping embedded in PatSnap platform, we conduct a relatively comprehensive analysis of SET evolution. Results disclose that the evolutionary trajectory analysis of SET reveals different characteristics in different stages, which involves spatial, main companies, IPCs and hot topics evolution, etc.. Multiple interactive driving forces play a significant role in various development phases. Finally, we give the research contributions and put forward related policy implications.

Research on the Promotion Mechanism of “Innovation-Capital” Interactive Co-operation——Taking WuXi AppTec As an Example

Based on the case of WuXi AppTec, this paper explores the mechanism of private innovative enterprises to realize enterprise value growth through innovation-capital interaction in the framework of life growth cycle. This paper constructs a mechanism of interactive coexistence of innovation and capital, which has certain enlightenment and reference significance for innovative enterprises to realize technology catch-up and improve their independent innovation ability through capital operation.

R&D, Learning by Doing and Economic Growth

This paper examines the relation between technical progress and economic growth. We build a growth model where the technological change depends on investment in research and development. Growth is determined by the imitation in the first stage of development, then innovation takes place. Assimilation and adaptation of technology produced in more advanced country play a crucial role in technological catch-up, but this imitation requires a precondition, an investment in human capital. The later remains a crucial factor of growth after the catch-up. Government can favour the economic growth facilitating and stimulating the technological change.

Regulations and technology gap in Europe: The role of firm dynamics

Abstract In this paper, we develop a new firm-level measure of distance to the productivity frontier that accounts for international technology spillovers stemming from the use of imported intermediate goods. The trade-weighted technological distance to frontier is matched with sector- and country-level data on regulation and firm dynamics (entry and exit rates) of 16 European countries. Using our measure of trade-adjusted technology gap, we investigate the role of labour, capital, and product market regulatory frameworks in the technology catch-up process, gauging the effect of firms’ dynamics in mediating and moderating the impact of regulation on the technology gap. Our study offers a novel perspective and insights to the analysis of the link between framework conditions and technological distance to frontier. While most scholars argue that less regulation always favours productivity growth and the diffusion of technology, our results provide a more nuanced picture. Deregulation is not a one-size-fits-all solution that leads to faster technology diffusion, instead heterogeneity in business dynamism and countries’ regulatory structures need to be considered.

Recombinant Capabilities and Technological Catch-Up in Open Innovation Context

Latecomer firms from emerging economies such as China are catching up quickly in recent years, and there is a burgeoning body of literature discussing which capabilities are required for these firms to compete in the global market. In this paper, we maintain that in order to catch up in the fast-changing high-technology industries, a deeper understanding is needed about whether and how the firms’ recombinant capabilities – the ability to alter the technological repertoire by recombining existing knowledge elements – can affect the technological catch-up process under the context of open innovation. Using a sample of publicly listed companies in the Chinese telecommunication industry from 2009 to 2015, our results suggest that both the ability of recombinant reuse and recombinant creation represent an opportunity for firms in the emerging economies to catch up; meanwhile, the technological returns from recombinant reuse are enhanced with a higher degree of R&D collaboration. This paper contributes to the literature of catch-up in high-technology industries by examining the dynamic capabilities required for competition in the open innovation context.

Closing Technological Gaps to Alleviate Poverty: Evidence from 17 Sub-Saharan African Countries

This paper examines the dynamics of ‘technological catch-up’ and its effects in contributing to poverty alleviation, a crucial pillar of the United Nations’ Sustainable Development Goals (SDGs). Using data on 17 sub-Sahara African (SSA) countries and employing the superlative-index number methodology, we first estimate the total factor productivity (TFP) gap between these African nations and both the USA (leader of advanced countries) and China (leader of developing countries) to provide a measure for technological catch-up that is comparable across African countries. We then investigate the contribution of technological dynamics in SSA to poverty alleviation using the System Generalised Method of Moments (GMM) method. Our results show that from 1987 to 2014, many African nations have to some degree reduced technological gap to the USA, whilst only a few of them managed to briefly catch-up with China until the early 2000s and no such catching-up is observed thereafter, due to the exceptional technological advance achieved by China in the past fifteen years. We find that closing technological gap has had significant poverty alleviation effect for African nations, although this effect is weaker vis-à-vis China. Our paper therefore highlights the important role played by technological progress in alleviating poverty.

Influence Mechanism of Ambidextrous Innovation on Technological Catch-Up in Latecomer Enterprises of Technical Standards Alliance

This study analyzes the mechanism through which ambidextrous innovation influences technological catch-up in latecomer enterprises. It first proposes a conceptual model of the influence of ambidextrous innovation on technological catch-up in latecomer enterprises and introduces the two regulating variables of alliance governance model and absorptive capacity. It then empirically studies the main effect and adjustment effect using hierarchical regression analysis based on a large-sample questionnaire survey, and finally, determines the effect and conditions of ambidextrous innovation on technological catch-up in latecomer enterprises.

Technological Change and Catching-Up in the Indian Banking Sector: A Time-Dependent Nonparametric Frontier Approach

This paper investigates whether there has been any improvement in efficiency convergence of banks in India during the post-reform period considering bank ownership structures, using a balanced panel for 73 banks over the time period 1996–2014. Utilizing nonparametric frontier estimators, we compute time-dependent bank efficiency scores, which allow us to examine the dynamics of technological frontier and catch-up levels of Indian banks, and to explore the convergence patterns in the estimated efficiency levels. Our results signify that the state-owned banks, which dominate the banking activity in India, establish themselves as the best performers, ahead of the private, foreign and cooperative banks during post-2005. Even during the recent global financial crisis period, we find that bank efficiency levels increased, except for foreign banks which have had the greatest adverse impact. The convergence results show that heterogeneity is present in bank efficiency convergence, which points to the presence of club formation suggesting that Indian banks’ efficiency convergence is partly driven by the ownership structure.

The impact of knowledge diffusion on economic growth across countries

The aim of this paper is to examine theoretically and empirically the impact of improvement in the capability to access innovation and knowledge on economic growth and convergence among countries. Our results, obtained using an augmented Solow-Swan growth model and panel data methodology with a sample of 138 countries for the period 1990–2014, show not only that improvement in the capability to access innovation and knowledge (proxied by percentage of internet users) has a positive impact on said economic growth, fostering the technological catch-up process for developing countries and accelerating the pattern of economic convergence, but also that this improvement has an even greater effect on developing countries when democracy is well developed, accelerating the pattern of economic convergence even further.