Contingent knowledge and technology development

It is widely recopnized that many different opes and forms of knowledge contribute to technology development. Formal codified knowledge, tacit knowledge, informal knowledge and cultural knowledge have all recently been addressed. However, one other particular form of knowledge—the contribution of knowledge/information embodied in the working context—has not been directly or explicitly addressed to the same extent. Tet this form of knowledge—'contingent knowledge'—it is argued, plays a crucial but under-appreciated role in technology development and innovation. In this paper, the concept of contingent knowledge is further explicated and illustrated by means of examples, and the strategic and practical implications are drawn out.     

A contribution to forecast theory

The overall basis of forecasting can be stated as a relation between the projection of the known values of the present and the uncertainty of the future. Information and uncertainty factors have been quantified by the “choice of alternatives” concept used in information theory. There is a strong analogy between information theory and the sum of squares equations used in regression. The regression equations can also be expressed in terms of information and uncertainty. The analogy is used as a background explanation for the relation between the length of the backcast and the confidence in the forecast. The relation is shown by the loss of confidence in the standard interval at the mean of the backcast time to the interval at forecast time. Confidence curves and tables are shown for the normal and t distributions using the 90% confidence interval as projected to various future times. Other intervals can be computed by changing the t value. The last part is a brief discussion of confidence envelopes for three and four dimensions.     

Interactive team reasoning: A contribution to the theory of co-operation

This paper describes interactions between agents who sometimes choose as individuals and sometimes as members of teams. Choosing as a member of a team entails not only being motivated by the team's objective, but also a distinctive pattern of reasoning: an agent who “team reasons” computes, and chooses her component in, aprofile evaluated using the team's objective function. It is not assumed that a given agent team reasons for a particular team; there may be more than one team, and which she reasons for is here treated probabilistically. Ordinary reasoning is a special case in which the team is a singleton. The framework therefore encompasses interactions paradigmatic in the theory of co-operative behaviour in which agents may choose either for the group of for themselves. The hypothesis that people may team reason if and when they are group motivated can, it is shown, explain some puzzling aspects of co-operative behaviour in a new way.     

Toward a non-linear theory of economic fluctuations: Allais's contribution to endogenous business cycle theory in the 1950s

Abstract

In this framework, the existence of a limit cycle is mathematically proved and its existence confirmed by empirical evidence. The mathematical tools are similar to Keynesian pioneering non-linear macrodynamic advances but the theoretical framework is obviously totally distinct. In particular, for Allais, the origin of endogenous cycles is monetary, and explained by the interplay between two key elements: the agents that hold the desired money balances and the banking system that can create money.     

Assessing the technology contribution to value added

Technology and knowledge are two key components for economic growth; however, the two concepts are not consensually defined. This paper proposes a model to assess and quantify the technology contribution to the value-adding process. The methodological approach implied building an operational concept for technology that is independent of the concepts of knowledge and capital. As such, technology could be interpreted and quantified as an input parameter in a new production model. This model interprets and assesses, separately, the value contributions of the uses of technology, of knowledge and of capital in a production process, defining the Technology Index for that process. The model is applied to manufacturing sectors of seven European countries, quantifying their respective dependences on technology. A comparison of the Technology Index proposed here is made with the OECD's Technology Intensity factor, arguing that the former reflects the technology dependence better that the latter. Accordingly, a criterion for classifying the economic sectors' dependence on technology is proposed. A main contribution from this study is an objective classification criterion for technology dependence of firms and economic sectors. It also provides an easy benchmark procedure for knowledge and capital dependence between firms and sectors.     

Integrating fuzzy-set theory into technology roadmap development to support decision-making

Technology roadmap has long been regarded as a useful tool for linking business to technologies. Accordingly, establishing the relationships between market, product and technology elements is an essential part of successful technology roadmap development. Despite the significance as of analysing such relationships, however, few previous attempts have been made to address this issue. To overcome the limitations of previous studies, therefore, this study focused on the relationships between the diverse roadmap layers and aimed to develop a decision-support tool to investigate these relationships. To this end, fuzzy inference was applied to determine the relative importance of link between the roadmap elements, considering the degree of significance as well as the degree of relationship between the two. This study is expected to contribute to the existing roadmap literature by emphasising the value of relationship analysis, and can also be useful in practice by improving the quality of information on technology roadmap.     

Boosting tourism's contribution to growth and development: Analysis of the evidence

The tourism sector's contribution to economic development depends upon complex and dynamic socioeconomic, environmental, and institutional factors. Policymakers require objective evidence to base decisions on which public policies or investments to pursue. In this paper we develop an economy‐wide approach to assessing public investments in tourism. The approach is powerful in that it considers all inter‐sectoral linkages that are critical for tourism‐sector analysis. This framework is linked to a microsimulation module that enables estimation of household‐level and destination‐specific impacts and the distribution of benefits. To illustrate the framework and the insights it can generate, we apply it to a public investment in Belize's Cayo District. Our findings show that the overall level of economic activity increases while an appreciation of the real regional exchange rate results in slower growth in traditional nontourism exports. Greater availability of capital and labor to meet increased demand would reduce this effect. The investment results in a reduction in the poverty headcount on the order of 0.7 percentage points, though there is a small increase in inequality that is a function of the skill requirements of the new positions created as a result of the investment.     

Towards a disequilibrium theory of structural dynamics: Goodwin's contribution

In this paper, we reconstruct the complex itinerary towards the solution of a conceptual and mathematical problem, how to obtain growth and fluctuations in a framework where structural change is an endogenous, though intermittent, phenomenon and irregularity a natural dynamic property. This has been Goodwin's life-long research program, driven by the effort of marrying Poincaré's qualitative approach to dynamical systems with the earliest (and some of the later) attempts to formalise economic structure as a set of interacting economic units, i.e. the cells of the modern cellular dynamics. This eventually led him to computational dynamics. Our interpretation integrates the more conventional one that emphasises conceptual connections with the thoughts of Marx, Schumpeter and Keynes. Focussing upon modelling issues of an apparently pure technical nature permits a comparison of Goodwin's evolving views with those that have emerged more recently in dynamics, e.g. in the real business cycle and endogenous theories of growth. In a brief assessment towards the end of the paper, it is argued that while there is still much to be done along the path he chose, Goodwin left enough indications for us to know in which direction to go.     

Toward enhancement of the contribution of theory to environmental policy

Theory can be helpful to policy makers by pointing out surprising relationships unlikely to be recognized by unaided common sense; by noting significant exeptions to principles widely accepted; and by offering generalizations of its own. The paper argues that theorists may not have done enough of the first two and may have overstressed the last, giving insufficient warnings of pitfalls. Examples of each of the three are provided. The first is illustrated by a theorem which shows that any new energy source, such as gasohol, which is supplied only because of a subsidy, prospectively uses up more energy than it creates. The important exception application is illustrated by showing that subsidies which reward reduced emissions by the firm tend to increase pollution by the industry. Finally, the paper discusses inadvertent bias in the empirical evidence reasserting the superior performance of fiscal incentives for reduced environmental damage as compared to direct controls, thus casting doubt on the allegedly universal superiority of incentives.Princeton and New York Universities. The author is extremely grateful to the C. V. Starr Center for Applied Economics at New York University for its support of the preparation of this paper and to Karl-Göran Mäler and an unidentified reviewer for very helpful suggestions. This paper was originally delivered as the keynote address of the 1991 meetings of the European Association of Environmental and Resource Economics held at the Stockholm School of Economics.     

A contribution to the theory of optimal utilitarian income taxation

The paper provides a new formulation of the Mirrlees–Seade theorem on the positivity of the optimal marginal income tax, under weaker assumptions and in a more general model. The formulation of the theorem is independent of whether the model involves finitely many types or a continuous type distribution. The formal argument makes the underlying logic transparent, relating the mathematics to the economics and showing precisely how each assumption enters the analysis.     

System strategies: application of technology and national systems of innovation theory to the case of australian rural research and development

Recent research has examined 'systems' o f innovation at the 'national' and 'technology' levels. This paper examines the efficiency and complementarity of these approaches through consideration of Australian rural research and development. Australian rural research and development underwent a period of sustained organizational and managerial charge during the 1980s and ear& 1990s. Much of that change has been surrounded by controvercy, due to the nature ofthe reforms that haze been implemented in the sector. The transition from a scattered and disparate research effort prior to 1985, to an effort which is today highly structured, commodity specific and strategically oriented, raises a number of issues concerning the processes used, the motirlation for the change and the manner in which change has been accomplished, The systems approaches of Nelson, Lundvall and Carlsson are used in this paper to examine the reforms that have been experienced in the sector. In so doing, the paper assesses their value as methods of empirical analyses, as well as proriding explanations of change as it has been experienced in the Australian research and development community to move beyond the somewhat restricted investigations of the past.     

The impact of the Interaction between institutional quality and aid volatility on growth: theory and evidence

We analyze both theoretically and empirically, the effect of aid volatility and its interaction effect with institutional quality on per capita economic growth. Our theoretical model, in which an aid-recipient government, operating in an institutional environment of some given quality (making choices over the distribution of aid), predicts that a negative effect of aid volatility on growth is mitigated by stronger institutional quality. We use panel data covering the period 1984–2004 for 78 countries to test this theoretical prediction. Using Generalised Methods of Moments (GMM) we find the relationship between growth and aid volatility is significantly negative and depends on institutional quality. Our baseline results are robust to various computations of aid volatility and foreign aid, time periods, sub-samples and additional covariates.     

Towards a kernel theory of external knowledge integration for high-tech firms: Exploring a failed theory test

Designing information systems (ISs) requires a thorough understanding of the organizational knowledge processes in which these systems are used. Although much is known about internal organizational knowledge processes, the understanding of external knowledge processes is less developed. Hence, this paper reflects an attempt to operationalize and test a model of the process of external knowledge integration (EKI), consisting of an identification, acquisition, and utilization stage. We utilize high-technology based firms from a variety of high-tech categories including nanotechnology based firms since these firms have critical knowledge integration needs. The results of an international survey, with responses of 317 high-tech companies, suggest that not these three EKI-stages, but four organizational effectiveness functions (goal attainment, pattern maintenance, adaptation, and integration) account for most variation in responses. These findings seem to imply that ISs that are to support the EKI-process should be designed according to organizational effectiveness functions rather than to EKI-stages. It is proposed that each organizational effectiveness function imposes different requirements on ISs because users interact differently with IS in each function.     

A contribution to the theory and empirics of Schumpeterian growth with worldwide interactions

This paper proposes an integrated theoretical and methodological framework characterized by technological interactions to explain growth processes from a Schumpeterian perspective. Global interdependence implied by international R&D spillovers needs to be taken into account in both the theoretical and empirical models. For this task, spatial econometrics is the appropriate tool. The econometric model we propose includes the neoclassical growth model as a particular case. We can therefore explicitly test the role of R&D investment in the long-run growth process against the Solow growth model. Finally, the properties of our spatial econometric specification allow the explicit evaluation of the impact of home and foreign R&D spillovers.     

Introduction to development theory

This article introduces the symposium on economic development theory.