Distributional Assessment of Emerging Technologies: Summary

Atlanta Conference on Science and Innovation Policy 2009This presentation was part of the session : Globalization of Science and InnovationThis material is presented to ensure timely dissemination of scholarly and technical work. Copyright and all rights therein are retained by authors or by other copyright holders. All persons copying this information are expected to adhere to the terms and constraints invoked by each author's copyright. In most cases, these works may not be reposted without the explicit permission of the copyright holder. ©2009 IEEE. Personal use of this material is permitted. However, permission to reprint/republish this material for advertising or promotional purposes or for creating new collective works for resale or redistribution to servers or lists, or to reuse any copyrighted component of this work in other works must be obtained from the IEEE.Emerging technologies are new, science-based, and potentially high-impact. Emerging technologies are particularly likely to increase inequalities because of initial high prices and high skill requirements. They are good targets for policy changes to reduce inequalities, however, because they are at an early enough stage to be shaped by public interventions. The project reported here studied the distributional consequences of five technologies in eight countries. The central question was "How do public interventions affect distributional outcomes for the same technology under different national conditions?" We studied the distribution of business opportunities, employment, benefits, and costs. The team chose "emerged" technologies for study - those that were introduced some time ago - so that they could track actual effects rather than projecting them. The cases were information and telecommunications technologies and biotechnologies. Examples from the past were used to develop a framework for thinking about the future for new areas such as nanotechnology or synthetic biology. The five cases studied are: genetically modified (GM) maize, mobile phones, open source software, plant tissue culture, and recombinant insulin. They represent both proprietary and public ownership models, and range from simple to highly complex. The eight countries included are: Argentina, Canada, Costa Rica, Germany, Jamaica, Malta, Mozambique, and the United States. Half are high-income and half are low or middle income countries. With regard to the distribution of business opportunities, two factors were clearly significant. One was intellectual property protection. In some of our cases, multinational corporations held tight control of intellectual property around a new technology, limiting the opportunity for other firms to enter the market. In GM maize, corporate control limited business opportunities even in related industries in countries far from headquarters. In recombinant insulin, the control is so tight that generic manufacturers had a hard time entering the market even after the original patents expired. In contrast, plant tissue culture, a public sphere technology, has created business opportunities in both developed and developing countries in our study. A second constraint on business opportunity, however, is skill. If an environment does not have enough people at a high enough skill level to support or extend the technology, the ownership question is moot. Open source software illustrates. Open source software is more likely to be used in large firms or universities than small ones. The reason appears to be that in order to benefit from the open source code, the organization must have sufficient programming skill to be able to make some adjustments in the software itself. For the same reason, open source software businesses appear to develop only in places where there is already a software industry; we did not find any evidence of open source-based businesses in the developing countries in our study. Direct employment effects of the emerging technologies in our study were small, with the exception of the mobile phone service industry. In mobile phones, new jobs were created directly with the new form of service, but as land line subscriptions begin to drop, jobs will be lost in that part of the telephone business. For the other technologies, high-technology manufacturing jobs tended to stay in affluent countries (e.g., in recombinant insulin), and there was a modest shift from lower-skilled, more dangerous jobs to somewhat higher-skilled, less dangerous ones. For example, GM maize allows for less pesticide use, a benefit to farm workers. By raising and stabilizing yields, the agricultural technologies we studied also stabilize incomes for family farms and their employees. Our study did not include any of the countries that experienced rapid growth in employment through electronics manufacturing - indicating that those experiences may be the exception rather than the rule. Considering the distribution of benefits and costs from the five technologies, we found a number of effects of public interventions (policies). Environmental regulation in Europe raises production costs for farmers who grow GM maize to fend off European corn borers. Deregulation in the mobile phone industry in several of our example countries brought competition, and competition brought the invention of pre-paid plans to reach broader sets of consumers. Pre-paid plans have in turn been the major marketing mechanism allowing very high rates of access in most countries. But the cost per call unit is higher, and the share of family income consumed is also disproportionate for low income families. Even the pre-paid plans, however, cannot reach the poorest consumers in areas where electricity is not dependable and the wireless equipment not installed. Thus we found that in Mozambique, mobile phone use is largely confined to the capital city, and men are much more likely to use them than women. Public procurement makes recombinant insulin available through public health services in most of the countries of our study. But in the United States, the spotty insurance system leaves significant gaps in coverage. And in Mozambique, doctors are hesitant to prescribe an insulin regimen for use in very poor households, which are unlikely to be able to sustain its complicated requirements. Public procurement also made tissue culture for banana plants available to poor farmers in Jamaica, but when the public subsidy disappeared, these farmers could not afford to import the material, as more affluent farmers did. These examples show that the distributional boundary for the technology is drawn in part by public action and in part by family conditions. The study cannot produce a one size fits all set of policy recommendations, because it shows that national conditions matter a great deal in crafting policy options to spread the benefits of new technologies broadly. It does, however, suggest that * Intellectual property protection should be moderated so that it is not used to suppress business opportunities or limit the availability of essential goods. * Pockets of highly-skilled workers can be critical in giving developing countries local access to new technologies. * Basic infrastructure and education are important investments in increasing the capacity of highly unequal countries to absorb and diffuse new technologies widely.European Commission; U.S. National Science Foundatio