Linking institutions and technical changes in a developing context: historical evidence from Iran

The roles of institutions in blocking successful technological changes are the prime concerns of this paper. A mixed framework is developed for this purpose based on concepts from national innovation systems (NIS), New Institutional Economics (NIE), and some sociological perspectives to policy and technology. In particular, this study shows how the institutional environment, called civic epistemology in this study, has framed the experience of industrialization in Iran through setting specific rules and regulations that in turn hindered technological learning. The general perception to the world (assumptions about the system), apprehension of the process of industrialization (assumptions about the problem), and comprehension of technology (assumptions about the solutions) are the constitutional elements of civic epistemology. They have framed the industrial regulations of the country to remove all barriers of machinery imports, stabilize the rate of currency exchange, allocate revenues of oil exports to such imports, and protect the local market through applying high tariffs for imported goods. Hence, more work at the cognitive level is required to complete the application of NIS in the context of developing countries. Some implications are discussed at the end.