National and international developments in technology - trends, patterns and implications for policy

Declining R&D intensities at the national level coincide with growing international technological links. Deviations of individual OECD countries from the average R&D intensity reflect differences in industry structure as well as in sectoral R&D intensity. At the same time, the sectoral distribution of R&D expenditure varies substantially less across countries than do the respective growth rates. Foreign direct investment (FDI) is the most important vehicle for the exploitation of "home-grown" technology abroad. FDI frequently also entails the generation of knowledge abroad in own R&D facilities the nature of which increasingly shifts from adaptation to innovation development and knowledge-seeking. In addition, international technological collaboration via in- and outsourcing and inter-company alliances is gaining growing significance. The policy challenges posed by technological internationalisation include the provision of better market access, more effective patent protection and competitive regimes, as well as the promotion of clustering and networking and international cooperation.