Search

The globalisation hypothesis states that greater economic interdependence among nations will lead to a diffusion of research and development and technology investment, resulting in a reduction of the significance of a nation's technological condition as a factor in trade patterns and competitiveness. A cross-country analysis of 48 nations indicates mixed results using two methods. The first approach does not support the hypothesis while the second one is inconclusive, showing a relation between technology investment catch-up and technology-intensive manufacturing trade performance in only some newly industrialized countries.

Trends and lag intervals in the relationship between national technology investment and related trade performance are investigated. These concerns are critical for the prescription and implementation of science and technology policy focused upon building international trade competitiveness. Using a sample of over 30 nations, a lag interval of less than three years generates the strongest cross-country correlations between R&D investment and employment and trade success. When changes in technology effort and trade in technology-intensive manufactures indicators are examined during the 1980s, mixed results arise (unlike the marked positive link of previous studies focused on ratios at one point in time). Increased investment in many older industrialised nations do not appear to be ‘paying off’ in terms of trade success. This may be evidence of internationalisation acting to dissolve the geographical nexus between efforts to build technological competitiveness and economic returns. Some marginal weakening in the association between technology investment and trade is also observed when their levels are compared in the 1970s and 1980s. National technology investment indicators remain as good predictors of international trade competitiveness in the late 1980s.