The Traps of Immature Innovation Systems

: How High-tech Aerospace Businesses in Brazil have Nationalised Costs and Internationalised Rewards

Abstract

High technology industries from late industrialising countries may not be perceived as a threat to leading global corporations and governments in developed countries. In reality, the idea that businesses in the high-tech sector may be able to succeed in emerging and developing economies may be counterintuitive for at least three reasons. First, conditions for their success, i.e. the abilities of public and private institutions that comprise the national system of innovation (NSI), may be immature at best. Second, these businesses may not have access to the same resources (technology, skills, capital, etc.) as industries in countries at the technology frontier. In fact, the shortage of resources in latecomer countries is what defines latecomer firms. Third, the high-tech sector is comprised of knowledge and capital-intensive industries. In effect, this sector may be described as industries with a high concentration of STEM (science, technology, engineering, and mathematics) or knowledge professionals. Nevertheless, some latecomer firms manage to emerge, grow, and continuously innovate despite the immature condition of their NSI as in the case of the aerospace industry in Brazil. To discover how businesses can succeed within an immature NSI, this study investigates the ways aerospace firms access key resources for technological innovation in Brazil. The results of this qualitative research demonstrate a combination of two conditions. Firstly, local policy and institutional efforts as well as national investments have been decisive for any success, although structural inconsistencies of public policies have trapped public and private organisations into a self-reinforcing immaturity of the NSI. Secondly, the strengthening of foreign linkages at the expense of local linkages has been a way for businesses in the high-tech sector to escape the traps of an immature NSI. As an implication, I argue that the combination of both conditions for success within immature NSIs indicates an unsustainable pattern of nationalising costs and internationalising rewards.

Date of Award	1 Nov 2022
Original language	English
Awarding Institution	King's College London
Supervisor	Valbona Muzaka (Supervisor) & Luciano Ciravegna (Supervisor)