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Conditions For Successful Technology Policy In Developing Countries—Learning Rents, State Structures, And Institutions


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  • Ha-Joon Chang
  • Ali Cheema
  • L. Mises


The paper develops an analysis of the economic, political, and institutional conditions for successful design and implementation of technology policy in developing countries. After a brief introduction (Section I), we discuss contending economic theories of technological change and technology policy (Section 2). It is concluded that, despite many pro-market arguments, market imperfections inherent in the process of technological change make the creation of learning and innovation rents by the state potentially very beneficial, especially in developing countries. The next section (Section 3) analyses the political and institutional factors that determine how effectively such rents can be created and managed. After an assessment of technology policy record in developing countries (Section 4) we discuss how the scope of such policy is affected by the recent changes in domestic and international policy contexts such as domestic deregulation and the emergence of a 'liberal' world order represented by the WTO (Section 5). The paper ends with a brief conclusion (Section 6).

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Bibliographic Info

Article provided by Taylor & Francis Journals in its journal Economics of Innovation and New Technology.

Volume (Year): 11 (2002)
Issue (Month): 4-5 ()
Pages: 369-398

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Handle: RePEc:taf:ecinnt:v:11:y:2002:i:4-5:p:369-398

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Keywords: Industrial Policy; Technological Development; State Autonomy; Institutions;


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Cited by:
  1. Stark, Manuel & Ahrens, Joachim, 2012. "Economic reform and institutional change in Central Asia: Towards a new model of the developmental state?," PFH Forschungspapiere/Research Papers, PFH Private University of Applied Sciences, Göttingen 2012/05, PFH Private University of Applied Sciences, Göttingen.
  2. Menezes, Jose H. V., 2010. "The political economy of innovation; an institutional analysis of industrial policy and development in Brazil," MPRA Paper 28849, University Library of Munich, Germany.


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