Technological Change and Innovation

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The impact of technological change and innovation is not a recent phenomenon. Technology, from the Greek words techn (useful knowledge) and logos (study), can be understood as the application of useful knowledge to everyday life and has acted as a main driver of change in the world.


Since the industrial revolution, technology has caused accelerated changes in society, first reshaping the face of agriculture and trade-based economies and transforming the world into manufacturing-oriented societies. The 20th century saw the dominance of three so-called engines of change that led to global economic growth and change: management, capital markets, and technology (Micklethwait and Wooldridge, 2002). These three engines are directed by the firm engaged in technology acquisition (Drucker, 1985).
There are two modes of technology acquisition. The first is to acquire the technology from abroad, as firms in Japan, South Korea, and Singapore did after the Second World War through the importation of capital goods, licensing, and foreign direct investments. Japan and South Korea used the technological know-how acquired to learn more about automobiles and computer technologies, for example, and then proceeded to improve on them to come out with world-class products like automobiles (Toyota, Nissan, and Honda), electronics goods (Sony and Panasonic), office equipment (Canon), and even cosmetics (Kao Corporation).
The second way for firms to acquire technology is to develop it from within, a process called indigenous development of technology, the route now being taken by America, the U.K., and several European nations. ...
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