Technological Innovation in Developing Countries

Technology innovations are happening around the world and are changing rapidly. MacDonald and Weisbach (2004) pointed out that these fluid innovations will transform the values of human capital. If skills are not updated for new technologies, existing skills will lose value, and becomes “has been skills.”

Technological innovation carries the challenge of how to catch up with advanced technologies in developed countries, especially for developing countries. Bhagavan (1990) points out that technological innovation is difficult for developing countries because the development of technological change has created a gap in product production and usage capabilities. As the development of products with modern technology progresses, products becomes easy for anyone to use and becomes versatile, while the production of the product is difficult because it requires advanced technology. Therefore, it is divided into countries that have the technology to produce products and the countries that are limited to importing and using the manufactured products. Countries that can provide products can be scaled up for product development in the future, while countries that rely on other countries for production will continue to rely on the technology of other countries. Given these situations, it is sure that technical products produced in developed countries will flow into developing countries and bring certain benefits associated with the use of those technologies. Still, if technology development in developing countries cannot catch up, the gap between developed and developing countries will be widened.

Smartphones are an example of such technical disparity, but Rwanda, for example, has been acting to rectify the disparity. Up to now, smartphone production was subject to the gap in production technology as mentioned above, but this October, Rwanda’s Mara Company succeeded in producing the first smartphone in the African continent (Monks, 2019). Rwanda is aiming to become a leading IT country in Africa by developing technological infrastructure such as internet access, creating a framework for facilitating the entry of new companies, and actively making IT-related agreements with other countries (Davis, 2019; Soo, 2018). From the perspective of Rwanda’s smartphone development, to catch up with technological innovation in developing countries, it can be said that it is crucial to form a foundation for technological innovation through governmental intervention.

References:
Bhagavan, M. R. (1990) Technological Advance in the Third World: Strategies and Prospects. Zed book: London.
Davis, M. (2019. 10. 19) Is Rwanda in line to become one of Africa’s major tech hubs? Big Think Retrived from https://bigthink.com/technology-innovation/rwanda-tech-hub?rebelltitem=1#rebelltitem1
MacDonald, G. and Weisbach, M. S. (2004) “The Economics of Has-beens.” The Journal of Political Economy. 112. 1. pp. 289 – 310.

Monks, K. (2019. 10. 08) Rwanda opens ‘first entirely homemade’ smartphone factory in Africa. CNN. Retrived from https://edition.cnn.com/2019/10/08/africa/rwanda-smartphone-factory/index.html
Soo, Z. (2018. 11. 01) Rwanda joins Alibaba-led electronic world trade platform amid US-China trade war. South China Morning Post. Retrived from https://www.scmp.com/tech/enterprises/article/2171148/rwanda-joins-alibaba-led-electronic-world-trade-platform-amid-us