External Sourcing of Technology

Developing countries can follow any of a number of paths as they pursue economic development. Japan provides a highly successful model that, in part, draws its strength from large national investments in education and R&D; as well as from a willingness to learn and build on technological advances discovered elsewhere.[8] Several other Asian economies appear to be following development strategies based on the Japanese model.[9]

In this section, Asian technology development is viewed from two perspectives technology developed internally and technology obtained externally. Internal technology development is gauged by an analysis of patents and patenting trends, a measure of inventive activity. External sources of technology are identified and compared by examining Asian purchases of U.S. high-tech products, licensing of U.S. technological know-how, acquisition of U.S. high-tech companies, and acceptance of foreign investment.

8. See Reischauer (1981) and Vogel (1979) for discussions of Japanese history, culture, and organizational structures, all of which shaped Japan's approach to industrialization.
9. See Dahlman (1994) for an extensive discussion of technology strategies underway in eight East Asian developing economies.

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