According to the Sachs’ three-tier model, the world of innovators is divided into high innovators (so-called “core” economies), technological diffusers and the excluded poor. High innovators, such as U.S.A and Sweden, for instance, are known as creators and sellers of original knowledge. Within 5 to 20 years this knowledge is adopted by technological diffusers as local firms purchase sophisticated machines to lower their production costs, FDI in high-tech industries is established and consumers buy innovative goods for personal use. Costa Rica, Mexico and Taiwan can be named among these. The excluded poor are naturally the most disadvantaged countries with low technology dispersion level and commodity-based FDI. Myanmar, Bolivia, Haiti, Ivory Coast and many others suffer from the lack of innovation systems needed to resolve urgent development issues. As a matter of fact, the financial resources in poor states are limited to establish these. Also, there is a certain inability to diffuse some technologies from abroad as they have been initially invented to serve the needs of the local area with specific weather conditions and ecology. The fertilizers that benefit the Mediterranean soil may be useless for the Andean regions of South America. Sachs defines it as an ecological specificity problem.
The innovation in developed countries comes both from private and public sector. As the knowledge transfer happens between companies, NGO’s and governmental institutions, the overall level of scientific development is increasing. However, despite the fact, that the demand for new technologies in poor countries is enormous, the local governments barely invest in the research and development. The reason is that such an investment would have negative returns because the local citizens are too poor to afford it. The areas of public health and agriculture are usually critically significant for the excluded poor. Without sufficient financing and due to the brain drain issues, there are no large scientific institutions established; these could have become the sources of continuous inventions.
The states that managed to attract FDI in the export areas and later engaged into collaborative relationships with the companies from core economies have accumulated the knowledge and experience needed to become more technologically advanced. Such a relationships also include joint ventures, strategic alliances and so on. The countries like South Korea and Taiwan have accomplished the conscious political programs which along with corporate knowledge transfer process has turned them from diffusers to innovators in a short period.
All in all, due to the lack of necessities in difficult ecologic and political environments, the excluded poor should be assisted by high innovators in order to obtain the technologies that would increase their living standard. The possible ways include better the technological transfer programs and relaxation of intellectual property rights regulations in the public health and agriculture areas.
459 words (text only)
Works Cited:
Sachs, Jeffrey. “The Global Innovation Divide”. Innovation Policy and the Economy 3, (2003): 132-141. Print.
