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458 Annals Am. Acad. Pol. & Soc. Sci. 7 (1981)

handle is hein.cow/anamacp0458 and id is 1 raw text is: PREFACE The articles in this volume consider the role of technology in the process of economic development. Some emphasize the interaction between advanced countries and less-developed countries (LDCs); some the interac- tion among LDCs, and a few the activities individual countries have taken to foster their own technological development. The transfer of technology is seen by almost all the authors as the implanting and nurturing of methods of production in which the critical elements are not the physical means of production, be they buildings or machinery, but the knowledge of how to operate such means effectively, or in one phrase, the achievement of techno- logical mastery. The characteristic features of the required knowledge are that it is not easy to specify in blueprints or manuals (see the articles by Dahlman and Westphal, McCulloch, and Teece in this volume); it is difficult to negotiate about, since so much of it is tacit and thus a fair price is difficult to define; and that recipients of technology cannot be passive but must undertake purposive action to increase the ability to identify their needs, to learn about those technologies that might be particularly useful, and, especially, to operate them successfully. Unlike some international agencies and some LDC analysts who ritually invoke the free transfer of-often high-technology as the critical missing catalyst to accelerated development, almost every author alludes to the hard work and substantial monetary costs incurred by both transferor and recipient: no magic wands exist to accelerate development, and not only are there no free sandwiches, there are no free high-yield seeds with which to grow the grain for the bread. An important organizing principle for much of the analysis is the distinc- tion between the high costs-and risk-of developing a new technology and the theoretically low cost of disseminating the technology once it has been fully developed. These propositions, if correct, lead to a dilemma. Insofar as individual firms undertake research and development, some mechanism must be introduced to guarantee a reasonable rate of return on the large investment. However, such legal means as patents increase the cost of dissemination above the desirable level as those who want to use the new technology must pay royalties which may exceed the social cost of trans- mission. Many of the articles-for example, those by Evenson, Dahlman and Westphal, McCulloch, Pray, and Teece-suggest that the second proposi- tion, the low cost of dissemination, is in fact incorrect in both agriculture and industry. In industry, it is not a set of blueprints and machinery that is transferred but a substantial body of knowledge, embodied in both individ- uals and firms. Large costs must be incurred by either the transmitting or receiving entity. In some of the articles-for example, Teece's and Lecraw's-it is noted that given the technical difficulties and expense inherent in transferring organizational ability, and the resulting uncer- 7

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