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Efficiency of government intervention in technical change in telecommunications. Ten national economies compared

: Grupp, H.


Technovation 13 (1993), No.4, pp.187-220
ISSN: 0166-4972
Journal Article
Fraunhofer ISI ()
R and D; R and D efficiency; R and D management; technology policy; telecommunication; vertical integration

In all countries examined in this paper, the government is - directly or indirectly - involved in the system of telecommunication research and development (R&D). All these governments' policies tend to create market distortions, yet there is little in common between the ten countries that are compared. Among them, different working divisions have evolved between industry, network operators and state establishments for R&D in the telecommunication field. This paper highlights the diversity of structures present in some important industrial countries. A comprehensive measurement system for R&D efficiency in telecommunications is currently not available. This paper thus presents and discusses a set of quantitative, but non-monetary, indicators such as R&D expenditure, R&D personnel, scientific publications, patents and turnover. Expert assessments are added to this indicator system so as to overcome the incomplete links between them, their poor correlation with one another, and data avail ability problems. The quantitative findings are quite discouraging for both technology policy and R&D management. Most of the current preconceptions are not justified when measured carefully. Cross-wise, all possible correlations between government and network operator R&D contributions have been checked against world market shares, and the like. No significant correlations were found, and thus the future technological competitive position is likely to remain the same whether there is more or less government invention in national R&D systems. In addition, vertical integration and the intensity of R&D cooperation between national network companies and the related manufacturers do not result in typical success patterns between R&D and commercialization. There is no optimum, and no really disadvantaged setting for regulatory or business environments. Finally, it is important to note that the introduction of the formal framework of science and technology indicators within the sensitive ar e a of modern telecommunications R&D may be regarded as a facility to assist objective assessments derived from expert interviews, and may enlighten economic studies of the Schumpeterian type.