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Technological innovation in developing countries: theoretical analysis and empirical evidence in Sub-Saharan Africaógica en países en desarrollo: análisis teórico y evidencia empírica de África Subsahariana

13rd National Competition for Economic Research Grants

International economics

Senior Researcher : Pedro Mendi Güemes

Research Centre or Institution : Universidad de Navarra. Pamplona.

Abstract

Technological innovation holds promise as a way to help numerous people in less developed countries out of poverty. This project analyses four basic issues. First of all, what are the characteristics of companies which introduce new products and/or processes in less developed countries? Secondly, how do these companies generate their innovations? Thirdly, what are the consequences of technological innovation? And, finally, what are the main obstacles to innovation encountered by these companies?

The study of these questions will shed light which will permit a better design of both public policies and business strategies. In the framework of this project, the aim is to develop theoretical models, based on the empirical evidence available, which incorporate circumstances inherent in those countries, such as a relatively low capacity to absorb more advanced technology, institutional factors which weaken the protection of intellectual property rights, and the competitive pressure exercised by companies in the informal sector, which often exceeds the formal sector of the economy in terms of employment.

The main geographical sphere studied for this project is Sub-Saharan Africa countries. Due to its cultural and institutional factors, this region has traditionally been considered as having low capacity for technological absorption, which has impeded local innovation and the transfer of technology from advanced countries. However, the recent development of M-Pesa, a system of payments by means of the mobile phone, in Kenya, is a significant example of autochthonous innovations. This innovation responds to local needs of the population and its development brings enormous gains in efficiency, as well as the inclusion, from the financial point of view, of part of the population which was previously excluded from the banking system. The ultimate aim of the project is precisely the design of policies to facilitate the development of innovations like M-Pesa, which will have a real impact on the lives of millions of people.

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