Technological Change, Network Building and Dynamic Competitiveness in the Engineering Industry in Kazakhstan

The dynamic competitiveness of Kazakhstan's engineering-based firms is assessed on the basis of their prospects for technological evolution in terms of a simple, three-level taxonomy of goods — simple inputs/components, complex inputs/components and 'specialist supplier goods'. On the assumption that real wages in Kazakhstan will grow steadily and significantly over the foreseeable future, Kazakhstan firms will be forced to move up the 'technological ladder' to maintain competitiveness. The article concludes that a number of the targeted firms show clear potential for dynamic competitiveness. None, however, is fulfilling all the conditions for dynamic competitiveness at the present time. One of the main underlying factors tending to weaken the competitiveness of Kazakhstan companies is a historically conditioned tendency to isolation, which has effectively excluded networking as it operates in the advanced industrial economies. While the importance of human capital and human capital formation is generally recognised in the targeted companies, public policy in this area is perceived as being highly ineffective, in a situation where the companies themselves do not have sufficient resources to fund all the training they need.