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Submitted by Paulo Correa on
Asli, These results offer interesting insights for the design of innovation policy, a topic for which FPD is in high demand in the ECA region. Ana Margarida Fernandes, Chris Uregian and myself, found similar results for the case of technology adoption (Technology Adoption and the Investment Climate: Firm-Level Evidence for Eastern Europe and Central Asia, World Bank Econ Rev 2010 24: 121-147). In that paper we use survey data for 7,000 firms in 28 countries in Eastern Europe and Central Asia to examine the correlates of technology adoption proxied by ISO certification and web use. We found that complementary inputs such as skilled labor, managerial capacity, research and development, finance, and good infrastructure are shown to be important correlates of technology adoption. However, the link between market incentives and technology adoption seemed more nuanced: while stronger consumer pressure is significantly associated with technology adoption, competitor pressure is not, suggesting that in developing economies where access to finance is a big challenge, it is primarily firms with rents that are able to adopt new technology. Foreign-owned firms exhibit significantly better technology adoption outcomes, but privatized firms with domestic owners do not. We hope these findings contribute to a more comprehensive approach to technology (and innovation policy) in developing countries. Regards -