IDB-实施创新政策：国家开发银行的创新融资能力（英）-2022-100正式版

IMPLEMENTINGINNOVATIONPOLICIESCAPABILITIESOFNATIONALDEVELOPMENTBANKSFORINNOVATIONFINANCINGMarcoCarrerasStephanyGriffith-JonesJoséAntonioOcampoJiajunXuAnneHenowCataloging-in-PublicationdataprovidedbytheInter-AmericanDevelopmentBankFelipeHerreraLibraryImplementinginnovationpolicies:capabilitiesofnationaldevelopmentbanksforinnovationfinancing/MarcoCarreras,StephanyGriffith-Jones,JoséAntonioOcampo,JiajunXu,AnneHenow.p.cm.—(IDBMonograph;1035)Includesbibliographicreferences.1.Developmentbanks-Effectoftechnologicalinnovationson-LatinAmerica.2.Financialinstitutions-Effectoftechnologicalinnovationson.3.Technologicalinnovations-LatinAmerica-Finance.I.Carreras,Marco.II.Griffith-Jones,Stephany.III.Ocampo,JoséAntonio.IV.Xu,Jiajun.V.Henow,Anne.VI.Inter-AmericanDevelopmentBank.Competitiveness,TechnologyandInnovationDivision.VII.Series.IDB-MG-1035JELCodes:O2,O16,O23,O31,O38Keywords:innovation,nationaldevelopmentbanks,publicfinancialresources.Inter-AmericanDevelopmentBank1300NewYorkAvenue,N.W.Washington,D.C.20577Copyright©2022Inter-AmericanDevelopmentBank.ThisworkislicensedunderaCreativeCommonsIGO3.0Attribution-NonCommercial-NoDerivatives(CC-IGOBY-NC-ND3.0IGO)license(/licenses/by-nc-nd/3.0/igo/legalcode)andmaybereproducedwithattributiontotheIDBandforanynon-commercialpurpose.Noderivativeworkisallowed.AnydisputerelatedtotheuseoftheworksoftheIDBthatcannotbesettledamicablyshallbesubmittedtoarbitrationpursuanttotheUNCITRALrules.TheuseoftheIDB'snameforanypurposeotherthanforattribution,andtheuseoftheIDB'slogoshallbesubjecttoaseparatewrittenlicenseagreementbetweentheIDBandtheuserandisnotauthorizedaspartofthisCC-IGOlicense.NotethatthelinkprovidedaboveincludesadditionaltermsandconditionsofthelicenseTheopinionsexpressedinthispublicationarethoseoftheauthorsanddonotnecessarilyreflecttheviewsoftheInter-AmericanDevelopmentBank,itsBoardofDirectors,orthecountriestheyrepresent.TheInstitutionsforDevelopmentSectorwasresponsiblefortheproductionofthispublication.Coordination:VanderleiaRadaelli(Competitiveness,TechnologyandInnovationDivision-InstitutionsforDevelopmentSector,IDB)Collaboration:EduardoFernández-Arias(InternationalConsultant,SpecialistinEconomicDevelopment)GustavoCrespi(Competitiveness,TechnologyandInnovationDivision-InstitutionsforDevelopmentSector,IDB)NatháliaAmarantePufal(Competitiveness,TechnologyandInnovationDivision-InstitutionsforDevelopmentSector,IDB)EXTERNALVENDORSProductionEditor:SarahSchineller(A&SInformationPartners,LLC)Editors:LeslieHunterandAmyScott(NomadEditorial)Design:JesúsRivero(BeyupGlobal)IMPLEMENTINGINNOVATIONPOLICIESCAPABILITIESOFNATIONALDEVELOPMENTBANKSFORINNOVATIONFINANCINGMarcoCarrerasStephanyGriffith-JonesJoséAntonioOcampoJiajunXuAnneHenowIMPLEMENTINGINNOVATIONPOLICIESCAPABILITIESOFNATIONALDEVELOPMENTBANKSFORINNOVATIONFINANCINGContentsIntroduction……………………………61AnalyticalFramework…………………………10TheDevelopmentMissionoftheState:TheRoleofIndustrialPolicy………………11SystemsofInnovation,FinancialSupport,andtheImportanceofAdaptingtoCountries'DevelopmentalStages…………………………16MarketFailuresImpedingthePrivateFinancingofSociallyEfficientInnovationProjects…………………………………………19TheRoleofNationalDevelopmentBanksinSupportingInnovationandItsAdaptationoverTime…………………………21ꢀ1.1KeyCapabilitiesRequiredtoIdentify,Implement,andEvaluateProgramstoSupportInnovationInvestments……………301.2ComparativeAdvantageofDevelopmentBanksComparedwithOtherStateInterventions……………………………312MethodologyandDataCollection…………………………33Findings:ComparingCapabilitiestoSupportInnovationActivitiesacrossNationalDevelopmentBanks……………………………352.1InteractionwithOtherActorsintheDesignofPublicPoliciesandActivityofDevelopmentBanks……………………………372.2InnovationPortfolioofNationalDevelopmentBanks…………………382.3LearningMechanismstoIdentifyImpedimentstoInnovation………43EvaluationsandPeriodicReviewsbyIndependentEvaluators…………………43FormalLinkswiththeSystemofScienceandTechnology……………44DialoguebetweenNationalandLocalStakeholders……………46BuildingUpInternalCapacityonCatchingUp……………………………48LearningtoLearnorLearning-by-Doing……………………………49SpecializedUnits………………………………504IMPLEMENTINGINNOVATIONPOLICIESCAPABILITIESOFNATIONALDEVELOPMENTBANKSFORINNOVATIONFINANCING2.4DesignandImplementationStrategiesofNationalDevelopmentBanksforInnovationFinancing………………………522.5InstitutionalCapabilitiesofNationalDevelopmentBanks……………………532.6Self-EvaluationoftheActivitiesinSupportofInnovation……………………54ConclusionsandPolicyRecommendations……………55References……………………………58Appendix…………………………………69A1SystemsofInnovation………………………70A2LetterforInterviews……………………………72A3InterviewQuestions………………………………74A4SummaryoftheInterviews:ComparingCapabilitiestoSupportInnovationActivitiesacrossNationalDevelopmentBanks…………………76A4.1NationalDevelopmentBanks'InnovationMandate…………………76A4.2InteractionwithOtherActorsintheDesignofPublicPoliciesandActivitiesofDevelopmentBanks……………………………80A4.3InnovationPortfolioofNationalDevelopmentBanks………………………84A4.4LearningMechanismstoIdentifyImpedimentstoInnovation…………………88A4.5NationalDevelopmentBanks'DesignandImplementationofStrategiesforInnovationFinancing……………………………………91A4.6InstitutionalCapabilitiesofNationalDevelopmentBanks……………94A4.7Self-EvaluationofActivitiesinSupportofInnovation………………………975IntroductionIMPLEMENTINGINNOVATIONPOLICIESCAPABILITIESOFNATIONALDEVELOPMENTBANKSFORINNOVATIONFINANCINGTheroleofthestateastheleaderinsettingindustrialpoliciesandprovidingsupportforinnovationactivitieshasbeenwidelyrecognizednotonlyfordevelopingcountries(Chang,2002;Rodrik,2004)butalsoincreasinglyfordevelopedcountries(Mazzucato,2011;BlockandKeller,2015).ThisisevenmorethecasesincethebeginningoftheCOVID-19pandemic.Atthesametime,thediscussionontheimportanceofcreditcreationandrisk-takingcapitalmarketsforthedynamicsofinnovation,tosupportentrepreneursraisingtheirinvestmentlevels,hasdeephistoricalroots(Schumpeter,1934;1939),andithasregularlybeenatthecenterofacademicandpolicydebate(Rodrik,2004).Industrialpolicies,particularlywhentargetinghigh-riskactivities,requirealargeandconstantflowoffinancialresourcesforalengthyperiodoftime.Whiletheyhavehighpotentialforsocialanddevelopmentalimpact,investmentsininnovationareoftencharacterizedbyhighrisk,uncertaintyaboutsuccessandappropriability,longduration,andyoungageoftheborrower(usuallyastart-upfirm).Allofthesefactorsdiscouragebothfirms'decisiontoinvest(Crespi,Fernández-Arias,andStein,2014a)andadequateallocationoffinancialresourcesfromtheprivatefinancialsector(Griffith-Jonesetal.,2020).Thecentralrolehistoricallyplayedbybanksinsupportingtechnologicalchange,humancap-ital,andresearchanddevelopment(R&D)haschangedovertheyears,fromalong-termrelationshipwithentrepreneursbasedontrust(Minsky,1981)toanimpersonalrelationshipbetweenagentsandcustomers,mediatedbycreditratings(Kregel,2008).Therecentgreat-erfinancializationofbankoperations,duetothehigherprofitabilityofthefinancialsectorcomparedtothenonfinancialsector(Block,2014;Kay,2012;Wray,2011),eventuallyledtoasituationinwhichthefinancialsectorendedupfinancingitself,becomingincreasinglyde-tachedfromtherealsector(HaldaneandDavies,2011;MazzucatoandWray,2014;Minsky,1981;WrayandTymoigne,2008).Risingconcernsaboutthedifficultyofcapturingthere-turnsfromsuccessfulinvestmentsthatarenotfullyinternalizedbutpartiallydisseminatedthroughouttheeconomy,thelongtimeframesnecessaryforinnovationtotakeplace,andtheuncertaintyembeddedintheseprocessesmeanthatprofit-maximizingcommercialbanksarenotalwaysabletosupplysufficientfinancing,duetotheirgreaterfocusonthemaximizationoftheirrisk-adjustedexpectedshort-termreturns.Projectshaveahighfailurerate,andreg-ulatoryframeworksarenotalwaysappropriatedependingonthedegreeofnoveltyoftheinnovation(Griffith-Jonesetal.,2020;Rodrik,2004).Capitalmarkets,onthecontrary,areoftenseenasinstitutionsthatarewellpositionedtofinancehigh-riskinnovationprojects,althoughtheyarebecomingincreasinglymorefocusedonshort-termreturns(Daviesetal.,2014;Haldane,2015;Kay,2012).Evidencefrompublicsourceshasshownthat,contrarytothegeneralbelief,incountrieslikeFinland,Israel,and7IMPLEMENTINGINNOVATIONPOLICIESCAPABILITIESOFNATIONALDEVELOPMENTBANKSFORINNOVATIONFINANCINGtheUnitedStates,capitalmarketshavenotplayedamajorroleinprovidingearly-stagefi-nancingforhighlyinnovativeinvestments(BreznitzandOrnston,2013;KellerandBlock,2013;WhitfordandSchrank,2011).Atthesametime,ithasbeenrecentlyobservedthatinsomeregions,includingLatinAmerica,capitalmarketshavebeenreinforcingandexpandingtheirpositionsince2018,reachingrecordlevelsoverthefirsthalfof2021.ThishascontributedtoadramaticexpansioninthenumberofunicornsinLatinAmericaandtheCaribbeanfrom2to34inthelastfouryears.ꢀ1Theimportanceoflong-termfinancingandhighrisktoleranceascentraltoolsforinnovation(Christensen,1992;Freeman,1987;Lundvall,1992)hasgivenrisetofinancialinstitutionswiththecapacitytosupplythistypeofcapital.Inthisregard,theKeynesianviewthatfinancialmarketsarenotfullydevelopedisoneofthekeyjustificationsforthecreationandexistenceofnationaldevelopmentbanks(NDBs).Likeotherpublicinstitutions,NDBshavedifferentrisk-returnconsiderationscomparedtoprivatecommercialbanks.Amongtheirmostimportantrolesisprovidingfinancialsupporttodevelopmentbyhelpingfinancehigh-priorityareasthattheprivatesectorperceivesastooriskytoinvestinonitsown(Griffith-JonesandOcampo,2016).Inthiscontext,theselectionoftheareasofinterventioniscrucial,asthepotentialforspilloversisdirectlyrelatedtothetypeofinvestmentsupported(Crespietal.,2020).Tocorrectlyaddressmarketfailures,itisnecessarynotonlytoprovidesufficientfinancing,butalsotousetheappropriatefinancialinstruments.Differentinstrumentsservedifferentpurposesaccordingtothenatureoftheborrower,thetypeofinvestment,andespeciallythetypeofmarketfailure(Fernández-AriasandXu,2020).ThetypesoffinancialinstrumentsofferedstronglydependonthetypeoffinancingthatNDBscanraise.Theymustbedesignedtoservespecificpurposes,andtheymustbeadaptedtothechallengesatdifferentstagesofdevelopment(Lin,Sun,andJiang,2013).HowNDBsshouldusetheirresourcestoencouragepositiveeconomicrisk-takingwhilemini-mizingfinancialriskisoffundamentalimportanceinthiscontext(Griffith-Jonesetal.,2020).Atthesametime,giventhelimitedavailabilityofresources,itisalsoimportanttoguaranteethatNDBsgenerateadditionalitybycrowdinginadditionalresourcestotheeconomy.ThekindsofcapabilitiesthatNDBsneedtoacquire,developinternally,orintegratetosuccess-fullysupportthefinancingofworthyinnovativeprojectscanbedividedintothreegroups(Cornicketal.,2018;Crespi,Fernández-Arias,andStein,2014b):(i)technical(financialaswellastechnological);(ii)operational,toimplementprogramsincoordinationwithclientsand1./en/articles/business/latin-america-has-a-record-of-over-6-billion-in-investments-for-startups-in-a-half-year/8IMPLEMENTINGINNOVATIONPOLICIESCAPABILITIESOFNATIONALDEVELOPMENTBANKSFORINNOVATIONFINANCINGpartners;and(iii)publicgovernance,toensurepoliticalsupportforpreservingfunctionalin-dependencetoavoidcapture.Althoughallcrucial,thecapabilitiesthateachtypeofmarketfailurerequiresmayvary.TheabilityofNDBstoadapttheirstrategiesandapplysolutionstospecificcontextsisꢀfundamental.TherecentchallengesoftheCOVID-19pandemicshoneanevenbrighterspotlightonthetypesofdynamicknowledgeandcompetenciesneededwithinNDBstoquicklyadapttodifferentcontexts(MazzucatoandKattel,2020).Thecorrectbalanceisneededtomaintainandsupportalong-termvisionwhileaddressingtheshort-termeconomicandsocialconse-quencesofacrisis.Sofar,NDBsandmultilateraldevelopmentbanks(MDBs)appeartohavequicklyreactedandsupportednationaleconomiesinmostcountries(McDonald,Marois,andBarrowclough,2020),buildingontheexperienceofthe2008economiccrisiswithoutap-parentlycompromisingtheirlong-termmissionssuchaspromotingthegreeneconomyandinnovation(CarrerasandGriffith-Jones,2020).Thiscomparativenotebuildsontheprimarydatacollectedthroughflexiblesemi-structuredinterviewswithcurrentorformerNDBofficials,validatedandsupplementedbyinterviewswithstakeholdersoutsidetheNDB.ItdescribescommonanddifferentpracticesaroundthesubjectofcapabilitiesoftheselectedNDBs.TheanalysiswillstudythestrategiesfollowedbytheNDBsforthedesignandimplementationofinnovationsupportprogramsandthecapacitiestheyneedtobesuccessful.LittleisknownabouttheexperienceofthoseNDBsintheworldthathavebeenmostsuccessfulindesigningandimplementingprogramstosupportinnovation.ThisworkdescribesallthedimensionsofNDBs'internalorganizationtocarryoutthisactivity.Keyquestionsoftheanalysisare:(i)WhatprioritydoNDBsassigntothefinancingofinnovationprojects?;(ii)Whichoperatingmodelswouldbemosteffectiveinfinancinghigh-potentialinnovationprojects,avoidingcapture?Shouldtheyoperateonthefirstand/orsecondtier?;(iii)Whatcapabilities—(a)governance,(b)technical(financialandtechnological),and(c)operational(implementationandsustainability)—shouldNDBsdevel-optosupportinnovationcredit?;(iv)How,basedontheircontactwithclients,canNDBshelpidentifymarketfailuresfacedbyinnovativecompaniesandthusproduceandorganizeinfor-mationonpotentialprojectswithhighsocialreturns?;and(v)WhatisthebestframeworkforcoordinatingtheworkoftheNDBswiththeinnovationagencies?91AnalyticalFrameworkIMPLEMENTINGINNOVATIONPOLICIESCAPABILITIESOFNATIONALDEVELOPMENTBANKSFORINNOVATIONFINANCINGTheDevelopmentMissionoftheState:TheRoleofIndustrialPolicyThecentralandinterrelatedchallengesofindustrialpolicyarethepromotionofstructuralchangeintheeconomyandoftheinnovationsandtechnicalchangethatlieatthecenterofthatprocess.TheconceptthateconomicgrowthisalwaysassociatedwithinnovationandthechangeintheeconomicstructurehasitsrootsinSchumpeter(1939)andhasbeenem-phasizedmorerecentlybytheneo-Schumpeterianandevolutionaryschools(FreemanandSoete,1997;Pérez,2002).Theassociationofgrowthwithstructuralchangeisalsoatthecen-teroftheworkofChenery,Robinson,andSyrquin(1986)andofabroadersetofschoolsofeconomicthought.(1978),andthoseofincreasingreturnsunderscoredbycontemporaryneoclassicalmodelsofeconomicgrowth.2Wecanaddthegrowth-productivityconnectionsemphasizedbyKaldor3Thisimpliesthatthesupportforinnovationandneweconomicactivitiesmustbeatthecenterofanappropriatedevelopmentstrategy.Itsmajorpolicyfocusshouldbedynamicefficiency,understoodasthecapacitytogeneratenewwavesofstructuralchange(Ocampo,2017;2020).Whatthismeansisthatthefocusinemerginganddevelopingcountriesshouldbetopromotenewdynamiceconomicactivities,thelearningprocessesassociatedwithtechnologicalcatch-up,andthecapacitytograduallyjointheworldofinnovators.Thecre-ationofthedomesticlinkagesor“valuechains”associatedwithinnovativesectorsmustalsobepartofthatstrategy,aswellastheadequatemanagementofnaturalresourcesincoun-triesthathaveastrongstaticcomparativeadvantageincommodityproduction.Itequallyinvolvesthereductionoftheheterogeneityofproductionstructures,duetothecoexistenceoflow-(informal)andhigh-productivityactivities,asemphasizedbyLewis(1954)andRos(2001),amongothers.Contextualconditionsincludeanadequateeducationsystem,aproperphysicalinfrastruc-ture,anondiscretionarylegalsystem,animpartialandefficientstatebureaucracy,andsmoothbusiness-labor-governmentrelations.Avoidingmacroeconomicinstabilityisequallyessential,particularlyguaranteeingcompetitiveandstablerealexchangeratesinthefaceof2.See,amonganextensiveliterature,NelsonandWinter(1982),Dosietal.(1988),Taylor(1991),Chang(1994),Nelson(1993;1996),AghionandHowitt(1998),Rodrik(1999;2007),Ros(2001;2013),Amsden(2001),Ocampo,Rada,andTaylor(2009),Lin(2012),StiglitzandGreenwald(2014),andCherifandHasanov(2019).3.Seethenow-classiccontributionsbyRomer(1986),Lucas(1988),andBarroandSala-i-Martin(2003).11IMPLEMENTINGINNOVATIONPOLICIESCAPABILITIESOFNATIONALDEVELOPMENTBANKSFORINNOVATIONFINANCINGterms-of-tradefluctuationsandcapitalaccountvolatility.However,wewillleavetheseissues4aside,toconcentrateontheinstitutionsandpoliciesthatrelatetostructuralchange.Theroleofindustrialpolicyintheseprocesseshasbeenthesubjectofheatedcontroversies.Inrecentdecades,theemphasishasbeenonthepositiveroleoftradeopenness,butthereisnosimplerelationshipbetweentradeliberalizationandgrowth,asunderscoredinaseminalpaperbyRodríguezandRodrik(2001).Indeed,totheextentthateconomiesofscaleandlearningplayanimportantroleininternationalspecialization,comparativeadvantagescan5becreated.Morebroadly,successfuldevelopmentexperienceshavebeenassociatedwithvariablepolicypackages(Diao,McMillan,andRodrik,2019;Helleiner,1994;Rodrik,2007).IndustrializationandmanufacturingexportgrowthhavebeencrucialelementsofEastAsiansuccessstories,andlaterofthoseinSoutheastandsomeSouthAsiancountries,buthaveinvolvedsignificantelementsofstateintervention.Incontrast,inrecentdecadessomere-gionsinthedevelopingworld—particularlyLatinAmerica—havebeenfacinga“prematuredeindustrialization”(DasguptaandSingh,2006;Palma,2005;Rodrik,2016).Thedynamicsofproductionstructurescanbeseenastheinteractionbetweentwobasicforces:(i)innovations—broadlydefinedasnewtechnologies,newactivities,andnewwaysofdoingpreviousactivities—andtheassociatedlearningprocesses;and(ii)theintra-andinter-sectorallinkagesand,morebroadly,thevaluechainscreatedaroundinnovativesectors(Ocampo,2017;2020).Theinstitutionsrequiredtosupporttheseprocessesarecrucial,andalsosubjecttolearning.Elasticfactorsuppliesofqualitylaborareessential,aswellasade-quatefinancingfacilities—thefocusofthisreport.Dynamicmicroeconomicchangesarethebuildingblocks,butthedevelopmentofcompetitivenessisasystem-widefeature(Fajnzyl-ber,1990).Thisdefinitionofinnovationsfollowsthebroadconceptof“newcombinations”suggestedbySchumpeter(1961):newqualitiesofgoodsandservices,newproductionmethodsormar-ketingstrategies,openingofnewmarkets,newsourcesofrawmaterials,andnewindustrialstructures.Todaywewouldalsoaddnewwaysofmanagingtheenvironment,notablyadapt-ingtoandmitigatingclimatechange.Thedefinitionincludestechnologicalinnovations—themorecommonuseoftheconceptofinnovationsintheeconomicliterature—butalsoabroadersetofeconomicprocesses.4.SeeinthisregardRodrik(2008)andMissioetal.(2015).5.SeeKrugman(1990)andGrossmanandHelpman(1991)and,inrelationtodevelopingcountries,Ocampo(1986).12IMPLEMENTINGINNOVATIONPOLICIESCAPABILITIESOFNATIONALDEVELOPMENTBANKSFORINNOVATIONFINANCINGIndevelopedcountries,theincentivetoinnovateisprovidedbytheextraordinaryprofitsthatcanbeearnedbythepioneeringfirmsthatintroducetechnical,commercial,ororganization-alchanges,orthatopennewmarketsorfindnewsourcesofrawmaterials.Thisincentiveisnecessarytooffsettheuncertaintiesandrisksinvolvedintheinnovators'decisions,theincompletenatureoftheirinitialknowledge,andthefactthat,duetotheexternalitiesthattheinnovationgenerates,theymaynotbeabletofullyappropriateitsbenefits.Innovations,therefore,haveamixtureofattributesofprivateandpublicgoods.Statefinancingofre-searchanddevelopmentandtheprotectionofintellectualpropertyrights,aswellasdiffer-entwaysoffinancing—notablyprivateequityfunds—areessentialelementstogeneratethenecessaryfinancingandincentivestoinnovate.Indevelopingcountries,innovationsarelargelyassociatedwiththewindowsofopportunitythatcomewithtransferofsectors,newproducts,technologies,andorganizationalorcom-mercialstrategiespreviouslydevelopedinindustrialcenters(Pérez,2001).Thebenefitstofirmswilldependonthemixbetweenthebenefitsoflowerproductioncostsvs.thethinnerprofitmarginsofmatureactivitiesandthecostsofaccessingtheappropriatetechnologies.Thenetbenefitsmaybelimited;thus,intheabsenceofpolicyincentives,theremaybeasuboptimalsearchforneweconomicactivities(HausmannandRodrik,2003).Noinnovativeprocessispassive,asitrequiresinvestmentandlearning.Technologicalexper-tisemustalsogothroughamaturationprocessthatislinkedtotheproductionexperience.Amoreambitiouspolicyaimedatclimbinguptheladderintheworldhierarchyrequiresshorteningtransferperiodsand,mostimportantly,graduallybecomingamoreactivepar-ticipantintechnologygeneration(Lee,2019).Inthecaseofagriculture,innovationsmustbeadaptedtoecosystems,aprocessthatnormallytakestime(asitmustdealwithbiologicalcycles)andthereforelocalresearch.Inallcases,nationalinnovationsystemsmustbebuilt,includinginstitutionalframeworkstocoordinatethevariousactorsengagedininnovationandlearning.Theseincluderesearchanddevelopmentcenters,universities,technologicalschools,extensionservices,financingactors,andtheinnovatingfirmsthemselves.Anambitiousedu-cationalstrategyshouldsupportthisprocess.13IMPLEMENTINGINNOVATIONPOLICIESCAPABILITIESOFNATIONALDEVELOPMENTBANKSFORINNOVATIONFINANCING“Evolutionary”theoriesoftechnicalchangeprovideessentialinsightsintolearningdynamics.6Thesetheoriesemphasizethefactthattechnologyislargelytacitinnature—thatis,thatde-tailedblueprintscannotbeplotted.Thismeansthattechnologyisincompletelyavailableandimperfectlytradable,asitislargelycomposedofintangiblehumanandorganizationalcap-ital.Thisimpliesthattechnologicalproficiencyhasastronglearning-by-doingcomponent,andthatfirmsthatpurchasetechnologymustinvestinmasteringit,aprocessthatinvolvesadaptationandevenredesignsandothersecondaryinnovations.Anadditionalimplicationisthatinnovativefirmsonlyimperfectlyappropriatetheirbenefits.Thisisparticularlycriticalforinnovationsthatcannotbepatented(e.g.,thedevelopmentofnewactivitiesornewmar-ketingstrategies).Linkagesandrelatedvaluechainsareassociatedwiththedevelopmentofnetworksofsuppli-ersofgoodsandspecializedservices,marketingchannels,andorganizationsandinstitutionsthatdisseminateinformationandcoordinatetherelevantagents.Thisconceptsummarizestheroleplayedbybackwardandforwardlinkages(Hirschman,1958),butalsothatof(privateorpublic)institutionsthatarecreatedtoreducethecostofinformation(e.g.,ontechnologyandmarkets)andtomitigatethecoordinationfailuresinherentininterdependentinvestmentdecisions(Chang,1994).Complementaritiesgeneratepositiveexternalitiesamongagents,whichhelpreducetheircosts.Theyareoneofthebasesoftheeconomiesofscalethatde-terminethecompetitivenessofproductionsectorsinagivenregionorcountry—orthelackofit.Thecostandqualityofnontradableinputsareparticularlyimportantinthisregard.Theycontainspecializedservices,includingknowledge,andlogisticalandmarketingservices,forwhichproximitytoproducerswhousetheinputsorservicesmaybeacriticalfactor.Theymayalsoincludespecializedfinancialservices,whereclosenesscanalsobeimportantduetoasymmetricinformation.Inturn,thecapacitytogeneratevaluechainsinwhichexportshaveahigherdomesticvalue-addeddetermineshowmuchagivencountrybenefitsfromtrade.7Thecapacityofinnovativeactivitiestoattractcapitalandlaborwillbe