Transfer of Technology to Developing Countries: Unilateral and Multilateral Policy Options

This paper analyzes national and international policy options to encourage the international transfer of technology, distinguishing between four major channels of such transfer: trade in products, trade in knowledge and technology, foreign direct investment, and intranational and international movement of people. A typology of countries and appropriate policy rules of thumb are developed as a guide to both national policymakers and multilateral rule making in the WTO. We argue that the optimal policy mix varies across countries and that there is a need for differentiation in the design and application of rules in trade agreements as well as for a more explicit focus on evaluation of the impacts of policies.