The spread of technology and the level of development : a comparative study of steel mills using the Electric Arc furnace technology in India and Britain

• Main Author: Athreye, Suma
• Published: University of Sussex 1994
• Subjects: 330; Economics & economic theory
• Online Access: http://ethos.bl.uk/OrderDetails.do?uin=uk.bl.ethos.294425

In this thesis the relationship between the spread of technology and the extent of economic development is analysed. The quantitative dimension of the spread of technology is usually analysed in studies on the speed and extent of diffusion across countries and industries. The qualitative dimension concerns the adoption and use of technology which is usually studied in the literature on technology adoption and adaptation by firms. A process technology in two countries that differ considerably in their level of development, viz. UK and India, is considered. This controls for the technological and industrial specificity of the spread process allowing the influence of the development factor to be seen more clearly. The study is conducted at the industry/economy level, as well as the firm level. In this way the effects of the studying the different levels of aggregation together, and the relation between adoption and diffusion are clarified. The study indicates a wide diversity of patterns in the spread of technology across countries. Differences in both the coefficients of the diffusion curve and in the underlying functional form are identified. A deeper analysis of the patterns of spread in India and Britain reveals the greater influence of supply and infrastructure constraints in India, while in Britain the entire process was largely consumption constrained. If it can be assumed that capacity and production side constraints are more likely in industrialising economies, these dynamics could be inferred as more typical in influencing the spread of technology in developing countries. A study of the use and adoption of the technology by firms shows the importance of existing market structures, defined broadly to include the structure and organisation of production and consumption. In fact the composition of consumption in terms of users and user sectors was vital in defining rules of competition and in what way technology was harnessed as a competitive force. In the purely technological sense of operational efficiency it is shown that Indian firms performed more poorly than British firms. Furthermore this poor performance could be traced back to diversification strategies of Indian firms which in turn were a response to poorer levels of market formation in the economy.