Absorptive capacity and structural congruence: the binding constraints on the acquisition of technology--an analytical survey of the underlying issues

Inextricable links between international trade, growth and role of knowledge-creation are well-established in the economics literature. The issues of creation of technology, its diffusion and actual adoption have been discussed on both theoretical and empirical planes. Effective assimilation of advanced technologies hinges on the ‘Absorptive Capacity’ and the ‘Structural Congruence’ between source vis-à-vis the destinations; role of public policies for actual implementation of these new ideas is extremely crucial. This paper offers a synoptic overview of current research and sketch a possible extension of the analytical framework on an operationally feasible plane within the Computable General Equilibrium framework. The survey highlights that analysis of the issue of technology-induced growth in a knowledge-based society must further the analysis by highlighting the role of factors for capturing the benefits. It has been identified that the factors propelling the acquisition depend, inter alia, on human capital, infrastructures, learning effects, and indigenous inventive activity.