Coping with globalisation : public R&D projects in telecommunications technologies in developing countries

Abstract

The paper focuses on the response strategies of public research systems in various advanced developing countries (Brazil, India and Korea) to specific challenges paused by increasing integration of their respective host economies with rest of the world. These challenges have dented holes in the traditional support mechanisms for supporting such public R&D projects. The traditional support mechanisms had two integral components: (i) supporting the organisation and conduct of these public R&D projects through the provision of targeted research grants and other fiscal incentives; and (ii) providing an assured market for the output of these R&D projects through subscription to public technology procurement. Admittedly increasing deregulation and economic liberalisation meant that it has become very difficult to continue support public R&D projects through these traditional support instruments. The new international governance rules imposed by multilateral agencies such as the WTO on R&D subsidies and government procurement have added further constraints. Most developing countries, consequently, cop out while a few have managed to put in place, albeit through an iterative process, ingenious support instruments that can continue to facilitate such public R&D projects. The paper surveys these various ingenious, but credible instruments that serve as an important lesson for other developing countries which are in exactly the same situation. In short the paper focuses on practical policy concerns that can easily be replicated elsewhere in the developing world. Keywords: innovation capability, R&D policy, telecommunications equipment industry, telecom software exports, public technology procurement, Brazil, India and Korea JEL Codes: L63, O31, O32, 038