Technological innovation in a multipolar system: Analysis and implicationsfor US policy

This paper analyzes recent data on the "globalization" of industrial R&D, e mphasizing that the patterns of international R&D investments differ signif icantly among industries, and seem to differ among different activities wit hin the innovation process. I distinguish among the creation of new technol ogies (often identified with invention), the development of these invention s into commercially attractive products, and the production and marketing o f these new products. None of these activities is well measured within indu strial economies, and our measures of their international dimensions are ev en less reliable, The available evidence on trends in each of these three a ctivities suggests that the most significant increases in "internationaliza tion" have taken place in the exploitation of new technologies, largely as a by-product of increased crossborder direct investment in production activ ities. But at least some evidence indicates that much of the technology cre ation activities of large firms remains concentrated in their home economie s. Nevertheless, the structure of activity in technology development and explo itation resembles the pattern of trade in industrial manufactured products- increased specialization in specific technologies or innovative activities that relies on a supportive national infrastructure and innovation system, combined with declining costs of communication and crossnational investment . As a result, intrafirm and interfirm networks for the support of innovati on are developing rapidly throughout the world. The growth oh these network s is one of many indicators of the development of a "multipolar" science an d technology system in the world economy. (C) 2001 Elsevier Science Inc.