Technology Policy: Towards an Integration of Social and Ecological Concerns 9783110846256, 9783110136777

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de Gruyte r Studie s i n Organizatio n 5 2 Technology Polic y

de Gruyter Studie s in Organizatio n Innovation, Technology , and Organization

This internationa l an d interdisciplinar y book serie s fro m d e Gruyte r present s comprehensive research o n the inter-relationship between organization and innova tions, bot h technica l and social . It covers applied topic s such a s the organizatio n of : - R &D — ne w produc t an d proces s innovation s — socia l innovations, such as the developmen t of new forms of work organization and corporat e governanc e structure and addresse s topic s o f more genera l interest suc h as : — th e impac t o f technical change and othe r innovations on form s of organization of micr o and macr o levels — th e developmen t o f technologies and othe r innovation s under differen t organi zational conditions a t th e level s both o f the fir m an d th e economy . The serie s is designed t o stimulat e and encourag e th e exchang e o f idea s between academic researchers , practitioners , an d polic y makers , thoug h no t al l volumes address policy - or practitioner-oriente d issues . The volume s presen t conceptua l schem a a s wel l a s empirica l studie s an d ar e o f interest t o students of business policy and organizationa l behaviour, to economists and sociologists , an d t o manager s an d administrator s a t fir m an d nationa l level. Editor: Arthur Francis , Glasgo w Universit y Business School, Glasgow , G B Advisory Board : Prof. Claudi o Ciborra , Universit y of Trento, Italy Dr. Mar k Dodgson , The Australian National Unversity , Canberra, Australi a Dr. Pete r Grootings , CEDEFOP , Berlin , Germany Prof. Lauri e Larwood , Dean , Colleg e o f Busines s Administration , University of Nevada, Reno , Nevad a

Technology Policy Towards a n Integration o f Social an d Ecological Concerns

Editors Georg Aichholzer and Gerd Schienstoc k

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Walter de Gruyter · Berlin · New York 1994

Georg Aichholzer Senior Researcher , Institut e of Technolog y Assessment, Austria n Academ y o f Sciences, Vienna , Lecture r a t th e Universit y of Economics , Vienna , Austria Gerd Schienstock Senior Researcher , Academ y of Technology Assessment, Stuttgar t Lecturer a t th e Universit y of Stuttgart , Departmen t o f Socia l Sciences , German y With 3 4 tables and 2 3 figure s © Printe d o n acid-fre e paper whic h falls withi n th e guideline s of the ANS I to ensur e permanenc e an d durability. Library of Congress Cataloging-in-Publication Data Technology policy : towards an integration of social and ecologica l concerns / edite d b y Georg Aichholzer , Gerd Schienstock , p. cm . — (De Gruyte r studies i n organizatio n : innovation, technology , an d organizatio n ; 52) Includes bibliographica l references. ISBN 3-11-013677- 5 (alk. paper ) 1. Technological innovations. 2 . Technology and state . I. Aichholzer, Georg. II . Schienstock, Gerd . III . Series : De Gruyte r studie s i n organization ; 52. HC79.T4T453 199 3 338'.064-dc20 93-3799 4 CIP Die Deutsche Bibliothek — Cataloging-in-Publication Data Technology polic y : towards a n integratio n of social an d ecological concern s / ed . Georg Aichholzer and Ger d Schienstock. — Berlin ; New Yor k : de Gruyter , 199 4 (De Gruyte r studie s in organizatio n ; 52 : Innovation, technology, an d organization ) ISBN 3-11-013677- 5 NE: Aichholzer , Georg [Hrsg.] ; G T © Copyrigh t 199 4 by Walter de Gruyte r & Co., D-1078 5 Berli n All right s reserved, includin g those o f translatio n int o foreig n languages . No par t of thi s boo k ma y b e reproduce d o r transmitte d i n an y for m o r b y an y means , electronic o r mechanical , includin g photocopy , recording , o r an y informatio n storage an d retrieva l system, withou t permission in writing fro m th e publisher. Typesetting: Converte d b y Knip p Sat z un d Bil d digital , Dortmun d — Printing: Karl Gerik e GmbH, Berlin . — Binding: Dieter Mikolai , Berlin. — Cover Design : Johannes Rother , Berlin . — Printed i n Germany .

Preface

In almos t every Western industrialize d country, technology policy has become a field central to public policy. This development is due to the fact that international competitiveness is heavily dependent o n the extent to whic h a country succeeds in achievin g a positio n o f technologica l leadership . However , i t ha s lon g sinc e become generall y accepted tha t a mere policy of promoting innovative activities can but insufficiently stimulat e technological progress. Rather, successful political action i n this area depend s o n the creation o f structures conducive to innovation in suc h societal realm s a s education and the economy at large. Technology polic y ha s als o experience d a n extension in a second sense . Th e fact tha t a rather widespread 'technolog y euphoria' ha s been followed by a more sceptical assessmen t o f technology and technological progress , ha s also brought its negative social an d ecological effect s mor e int o the limelight. The prevention of such negative impacts creates a need fo r a whole new field of tasks. However, these cannot merely be added on to the traditional tasks of technology policy: they demand an integrative reorientation. Socially- and ecologically-oriented technology policy , as i t i s understoo d here , i s aimin g at a stronge r orientatio n of othe r policy fields towards technological development as well as towards the prevention of the more negative effects o f technological progress . As a whole , th e contribution s in thi s volum e have a dua l focus. Th e paper s in th e firs t par t ar e mainl y devoted t o investigatin g from a theoretica l poin t of view th e possibilities and opportunities as wel l a s the problems an d weaknesse s of a socially - and ecologically-oriente d technolog y policy . The purpos e o f th e second part is to inform o n the mode and extent to which a social and ecologica l orientation ha s alread y foun d it s way int o national technology policies. As will be seen , th e existenc e o f a n integrativ e policy conceptio n i n a reall y advance d version is still far from realizatio n anywhere in the world. However, a number of different an d promising beginnings can be discerned whic h do deserve attention and furthe r efforts . Our thank s go t o everyon e wh o ha s participate d i n th e creation o f thi s book . We woul d especiall y lik e t o than k all ou r author s fo r thei r cooperation . Thei r patience has been sorel y tested by the considerable difficultie s an d delays which such an international project i s bound to bring along with it. We would also like

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to acknowledg e th e suppor t receive d fro m th e Institut e for Advance d Studies , Vienna, where we started this work as well as from ou r present employing institutions, the Institut e of Technology Assessmen t (ITA ) at the Austria n Academy of Sciences an d the Academy of Technology Assessment of Baden-Württemberg, respectively. W e are especiall y gratefu l t o Gertrau d Stadier , wh o ha s care d fo r the boo k i n a most committe d way fro m it s beginning to th e final editing. Our gratitude goes also to Suzanna Stephens for her linguistic checking, as well as to all thos e supporter s an d colleagues a t various public institutions in Austria who have in various ways contributed to the realization of this project. Georg Aichholzer and Gerd Schienstoc k Vienna/Stuttgart, December 199 3

Contents

Preface V Technology Policy in the Process of Change: Changing Paradigms in Research an d Technology Policy? 1 Gerd Schienstock \ Introductio n 1 2 Traditiona l Motive s for Public R&T Policy 2 3 Fro m Materia l Technology t o Technological Practic e 6 4 Th e Crisis of Growth-oriented R& T Policy 1 5 Th e Rol e of Technology Policy : Support or Regulation? 1 6 R& T Polic y as a Social Experiment 1 7 Conclusio n 2 References 2

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From Socio-economic t o Socially Oriented Innovatio n Policy 2 Richard Badham

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\ Introductio n 2 2 Socio-economi c Innovatio n Policy 2 2.1 Conventiona l Wisdom 2 2.2 Institutiona l Implementation 2 2.3 Sociall y Oriented Technolog y Polic y 3 3 Th e Dualisti c Model o f Technology Policy 3 4 Sociall y Oriented Innovation Policy 3 4.1 Th e Limitations of Socio-economic Innovation Policies 3 4.2 Th e Nature of Socially Oriented Innovatio n Policies 3 4.3 Neo-Tayloris t and Skill-Based Manufacturin g Trajectories 35 5 Sociall y Oriented Innovatio n Policy Institutions 3 5.1 Technolog y Transfer an d Diffusion Mechanism s 3 5.2 Managemen t an d the Development of Human Capital Incentives 3 5.3 Worker s Representatives and Concrete Codeterminatio n Support . . . . 3 5.4 Nationall y Based Skil l Formation Restructurin g 3 6 Europea n Promotion o f Human Centred o r Anthropocentric Systems 4 6.1 Europea n Project s an d Programmes 4

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6.2 Th e Socio-technical Trajectory Define d 4 6.3 Ke y Issues of Human Centred Syste m Promotio n 5 6.3.1 Direc t Promotion 5 6.3.2 Technolog y Orientatio n 5 6.3.3 Socia l Orientation 5 7 Conclusio n 5 Notes 6 References 6

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Technology Policy : The Interaction between Government s an d Markets. . 6 Charles Edquist

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1 Introductio n 6 2 Som e Characteristics of Technological Chang e and Technology Policy 67 3 Ho w Technology Polic y is Formulated and Implemented in Practice 7 3.1 Th e Usefulness of Theory a s a Basis for Technology Polic y 7 3.2 Imitatio n - A Common Mod e of Technology Policy-makin g 7 3.3 Lobbyin g as a Mechanism behind Technology Polic y 7 3.4 "Diagnosti c Analyses " - a n Alternative Basis for Technology Policy-making 7 4 Objective s of Technology Policy 7 5 Reason s fo r State Intervention in the Process of Technological Chang e . . . . 8 6 Instrument s of Technology Polic y 8 Notes 8 References 9

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Promote or Regulate: Th e Dilemma of Innovation Policy 9 Ernest Braun

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1 Introductio n 9 2 Technolog y Polic y an d Technological Innovatio n 9 2.1 Th e Scope of Technology Polic y 9 2.2 Definitio n o f Technological Innovatio n 9 2.3 Th e Rol e of Technological Innovatio n in the Economy 9 3 Th e Perceive d Nee d for Innovation Policy 10 3.1 Reductio n of Risk for Private Enterpris e 10 3.2 Publi c Requirements for New Technologies 10 3.3 Directin g Privat e Innovation toward Public Needs 10 4 Way s of Promoting Innovatio n 10 4.1 A Taxonomy o f Possible Suppor t Measures 10 4.2 Researc h an d Development 11 4.3 Direc t Suppor t for Innovation 11 4.4 Procuremen t 11 5 Nee d for Regulation 11 5.1 Adequac y an d Compatibility of Products 11 5.2 Safet y and Health 11 5.3 Environmenta l Protection 11

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Contents I

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6 Mode s o f Regulation 12 7 Summar y and Conclusions 12 References 12

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New Technology Polic y Concepts: Som e Reflections on Technology an d Work Humanizatio n in West German y 12 Richard Badham and Frieder Naschold

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1 Introductio n 12 2 Ne w Technology Policy Concepts 12 3 Traditiona l Limitations o f Work Design Reforms an d Programmes 12 4 Th e Japanese Challeng e 12 5 Nationa l Conditions of NTPCs 13 6 Backgroun d and History of the West German Humanizatio n of Work Programme 13 6.1 Internationa l Background 13 6.2 Ke y National Influences 14 6.3 Thre e Phases of the Programme 14 7 Ne w Technology Policy Concepts i n the West German Humanization of Work Programme 14 7.1 Overvie w 14 7.2 Th e Complex Nature and Tensions within NTPCs 14 7.3 Th e Impac t and Significanc e of the NTPCs 15 7.3.1 Managemen t Domination of Investment Strategies 15 7.3.2 Lac k of Programme Integratio n 15 7.3.3 Problem s of Diffusion 15 7.3.4 Indirec t Benefits 15 8 Conclusio n 15 Notes 15 References 15

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Designing Sustainabilit y of Industrial Society 16 Udo E. Simonis

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1 Introductio n 16 2 Ecologica l Structura l and Technological Chang e of the Economy 16 2.1 De-linkin g Economic Growth from Environmentally Significan t Inputs . 16 2.2 Example s of Successful and Unsuccessful De-linking 16 2.3 Trend s Toward s Industrial Restructuring 16 3 Preventiv e Environmental Policy 16 3.1 Environmenta l Expenditures - Environmenta l Damages 16 3.2 Basi c Conditions of Preventive Environmental Policy 17 3.3 Environmenta l Impact Assessment as Part of Preventive Policy 17 4 Ecologica l Orientatio n of Economic Policy 17 4.1 Conflict s between Econom y and Ecology 17 4.2 Ecologica l Self-Regulation of the Econom y 17 4.3 Ecologica l Economi c Polic y 17

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5 Conclusion s 17 References 18

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Constructive Technology Assessment : A New Approach fo r Technology Assessment Develope d i n the Netherlands an d its Significance for Technology Polic y 18 Joey van Boxsel 1 Introductio n 18 2 Socia l an d Environmental Consequences o f Technology: Th e Emergence o f Technology Assessmen t 18 3 Scienc e an d Technology Polic y in the Netherlands and their Broader Concern s 18 4 Technolog y Assessmen t in the Netherlands 18 5 Th e Idea of "Constructive Technology Assessment" 18 6 CTA : Experiences o f ΝΟΤ Α 19 6.1 CT A Case Studies 19 6.2 Technolog y Dynamic s 19 6.3 Constructiv e TA Projects by ΝΟΤ Α 19 6.4 Disseminatio n Activities 19 7 Th e Future of Constructive Technology Assessment 19 8 Th e Significance of Constructive TA for Technology Polic y 20 References 20

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Integrating Social an d Environmental Costs into High-tech Industrial Development Planning : Experiences an d Expectations in the United States 20 5 Gregory A. Daneke 1 Introductio n 20 2 Regiona l Economic s and the High-tech Solution? 20 3 Th e Problematic Panace a 20 4 A Mixed Blessing 20 5 Th e Curious Case of Groundwater Management 20 6 Additiona l Environmental and Social Cost s 21 7 Toward s a Sustainable Perspective 21 8 Re-orientin g Economic Institution s 21 9 Conclusion s 21 References 21

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Socially Oriented Technolog y Policy in Germany: Experiences o f a North Rhine-Westphalian Programme 22 Erich Latniak and Georg Simonis

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1 Introductio n 22 2 Integratio n of Differing Goal s i n Technology Policy ? 22 3 Reason s fo r a Socially Oriented Technolog y Policy Initiative in 198 4 in North Rhine-Westphalia 23

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4 Administrativ e Output: The Initiative Zukunftstechnologien and the Programme Mensc h und Technik - Sozialverträglich e Technikgestaltung . . . 23 4.1 Patchwor k or Integration? 23 4.2 Organizationa l Aspects o f Implementation 23 4.3 Change s during Programme Implementation 23 5 Outcom e and Impact - Learnin g Effects on Different Level s 24 6 Conclusion s 24 Notes 24 References 24

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National Policie s Devoted to Technology an d the Environment in France: Towards a n Integrative Approach ? 24 Lahsen Abdelmalki and Thierry Kirat 1 Nationa l Technology Policy an d General Innovation-Supportin g Mechanisms 25 1.1 Theor y an d Practice o f National Policy in Favour of Science an d Technology 25 1.2 Fro m Scientifi c Polic y to Technology Polic y 25 1.3 Technology , Institutiona l Change an d National Policy 25 2 Frenc h Environmenta l Policy, Past and Present 25 2.1 Environmen t and Environmental Policy: An Introduction 25 2.1.1 Definitio n an d Scope o f the Environmental Issue 25 2.1.2 Trend s and Practice i n Environmental Policy 25 2.2 Feature s o f French Environmenta l Policy 25 2.2.1 A Belated, Flexibl e and Centralized Environmenta l Policy . . . 25 2.2.2 Th e Tools o f the Environmental Policy 25 2.2.3 Th e Institutiona l Infrastructure of Environmental Policy and its Recent Evolutio n 26 3 Th e Technological Dimension s of Environmental Protection an d their Impact on National Policy 26 3.1 Technologica l Creatio n and Environment: From Knowledg e to Innovation 26 3.2 Trend s i n the Organization and Nature of Technologies i n the Field o f Environmental Protection 26 3.3 D o Environmental Technologies Reveal a Rift i n the Industrial System? 26 4 Nationa l Policies: Between Theoretical View s and Social Realitie s 27 4.1 Th e Instrument s of Economic Analysis in Environmental Policy 27 4.2 Environmenta l Protection a s Central to Social Attitude s and Technological Choices 27 5 Conclusio n 27 Notes 27 References 27

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The Historical Development of Japanese Scienc e an d Technology Polic y in Conjunction wit h Socio-economic Polic y 27 Masahiro Kawasaki

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1 Introductio n 27 2 S& T Institutional Framework an d S&T Policy a s Built into Industrial Policy (1945-1955) 28 3 Towar d the Integration of Science an d Technology Polic y under Economi c Growth and Liberalization Policy (1956-1969) 28 4 Priorit y Shift o f S&T Policy fro m Economic Growt h to Social Welfar e (1970-1980) 29 5 S& T Policy Buil t into Globalization (afte r 1981 ) 29 6 Conclusion s 30 Acknowledgments 30 References 30

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National Systems o f Innovation and Technology Policy : The Case of Denmark 30 Bent Dalum

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1 Introductio n 30 2 Recen t Developments i n Danish Technology Polic y in Brief 30 3 Internationa l Specialization of Small OECD Countries 30 4 Nation s and Globalization 31 5 'Socially-Oriented ' Technology Polic y i n a Danish Context - Som e Example s 31 Notes 31 References 32

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Towards a Social Orientation in Finnish Technology Polic y 32 Torsti Loikkanen and Esko-Olavi Seppälä

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1 Introductio n 32 2 Polic y for R&D 32 3 Finnis h (Science and ) Technology Polic y 32 3.1 Prio r to the 1980 s 33 3.2 Fro m th e Technology Committe e t o the Government's Report t o Parliament in 198 5 33 3.3 Th e Science an d Technology Polic y Council 33 4 Toward s a Social Orientation ? 33 4.1 Th e Social Orientation 33 4.2 Th e Role of Technology Polic y for Finnish Economic an d Socia l Development 33 4.2.1 Development s befor e the 1980 s 33 4.2.2 Toward s Socia l Orientatio n i n the 1980 s 33 4.2.3 Technolog y Assessmen t Effort s 33 4.2.4 Intermediat e Summary 33 4.3 A Case: Integration of Environmental and Technology Policie s 34

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4.3.1 Development s Prior to the 1980 s 34 4.3.2 Toward s a n Integrative Approach 34 4.3.3 Intermediat e Summar y 34 4.4 Assessmen t o f Finnish Development 34 5 Conclusion s 34 References 34

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Technology Polic y i n Spain: Issues, Concerns and Problems 34 Luis Sanz-Menendez and Emilia Munoz

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\ Introductio n 34 2 Antecedent s of the Spanish Situation in Science an d Technology: 1940-197 5 . 35 2.1 Fro m Self-sufficienc y t o the Stabilizatio n Plan: 1939-195 9 35 2.2 Th e Perio d o f "Developmentism" in Spain: 1960-197 5 35 3 Th e Position of Science an d Technology durin g the Democratic Transitio n . . 35 4 Publi c Policy Actions in Science an d Technology 35 4.1 Th e Refor m of the Science/Technology System i n Spain i n the 1980 s . . 35 4.2 Th e Instrument s of Reform 36 4.3 Technologica l Polic y and the National R&D Plan 36 4.4 Technolog y Polic y and the Ministry of Industry and Energy 36 5 Larg e Policies , Littl e Ecological an d Social Awarenes s 36 6 Conclusion . Convergence wit h Europe : How Far are We? 36 Notes 37 References 37

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Technology Polic y unde r Conditions of Social Partnership : Developmen t and Problems of an Integrated Strateg y i n Austria 37 Georg Aichholzer, Renate Martinsen and Josef Melchior

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1 Introductio n 37 2 Structura l Conditions of Technology Polic y i n Austria 37 2.1 Th e Proble m o f Small States 37 2.2 Economi c Structur e 37 2.3 Th e Polic y Pattern of Social Partnershi p 37 2.4 Ne w Challenges 37 3 Developmen t an d Organization of Technology Polic y 38 3.1 Initia l Phase 38 3.2 Integratio n Phase 38 3.3 Distributio n of Competences 38 3.4 Decision-makin g 38 4 Goals , Instrument s and Resources o f Technology Policy 38 4.1 Technolog y Polic y Concept 38 4.2 Instrument s 38 4.3 Expenditure s 39 5 Stat e of Affairs an d Problems Regardin g the Implementatio n of an Integrated Technology Policy 39 5.1 Polic y Mix and Effect s 39

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5.2 Considerin g Socia l an d Ecological Aspects 39 6 Summar y 39 Notes 39 References 40

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Biographical Notes 40 Subject Inde x 40 Name Inde x 41

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Technology Polic y i n the Process of Change : Changing Paradigm s in Research an d Technolog y Policy? Gerd Schienstock

I Introductio n There is no modern industrialize d country not pursuing research an d technology (R&T) polic y i n one wa y o r another. Althoug h state interventionis m in genera l is viewe d mor e an d mor e scepticall y an d despit e a n increasin g shif t toward s favouring th e regulatin g power o f th e market , hardl y an y cal l ha s bee n voice d thus fa r fo r th e state' s withdrawa l fro m th e field s o f research , innovatio n and technology. T o the contrary : no t onl y is public R&T polic y considere d t o be a s indispensable as ever for stimulating economic growth, but it has acquired an even growing importance withi n th e scale of stat e activities . I t may be expected that , as knowledge abou t th e complexit y of technological innovatio n increases, stat e R&T policy will gradually develop into an independent policy field (see Edquist, this volume). Rather than asking fo r an expansion of technology polic y along existing lines, critics refer to the lack of attention devoted t o the social shapin g of technological development, a s wel l a s t o th e socia l compatibilit y o f technologica l change . Moreover, i t i s pointe d ou t tha t ther e i s a lac k o f ecologica l precaution s an d environmentally-benign technolog y - a deficit whos e solutio n i s also expecte d from the state. What one has in mind, though, is not an expansion of R&T policy by complementary measure s whic h take int o account social an d ecological aspects . Rather, there is a generalized cal l for either an integrative or systemic technology policy. Accordin g t o OECD , ther e i s a nee d fo r complet e re-orientatio n withi n this policy field. Its substance must be newly defined, new spheres of intervention must b e identifie d an d ne w structura l arrangements mus t be develope d (OEC D 1988). I n th e following , some o f th e tendencie s shal l b e pointe d ou t o f suc h a re-orientation i n state R& T policy.

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2 Traditiona l Motives for Public R&T Polic y Discussions o n the justification o f stat e R& T polic y ar e generall y based o n th e assumption that economic growth is the central indicator of social well-being and, as such, constitutes a high-ranking societal goal. In turn, decisive growth impulses are said to emanate from technological innovation . Technological development is typically depicted a s a linear phase scheme; whil e here, for reasons o f simplification, the three stages o f research, innovatio n and diffusion shal l be distinguished. As disruptions in the course o f technological development constitut e a danger to economic growth , there i s therefore a major societal interes t in overcoming them (see Braun, this volume). There i s a reaso n fo r attributin g such a n importan t rol e i n th e proces s o f technological innovatio n to th e state : th e structura l problems arisin g withi n th e various stage s ar e ofte n no t solve d wit h equa l efficienc y b y th e market . Th e market process , oriente d alon g th e self-interest s o f privat e actors a s fa r a s th e goal of economic growt h is concerned, lead s to a n insufficien t leve l and/or t o an inappropriate structure of national economic innovation . The central task of state R&T policy is considered to be to correct or even to avoid any such deficiencies by influencing innovation . Moreover, th e latte r shoul d basically continue to follow market economi c principle s (Littmann 1975:45) . Thus , i n justifying stat e R& T policy, crucial importance is attached to the aspect o f market failure i n achieving economic growt h - regardles s o f how great this failure i s considered to be. The followin g enumeration includes the major structural problems of the pro cess of technological innovation: According to the theory of economics, thes e are solved unsatisfactorily, if at all, by market-oriented economies: th e availability of sufficient knowledg e in the natural sciences, the technical or economic indivisibility of large-scale projects , and the lack of transparency of the market (Ewers/Wein 1989). As a consequence, the state is assigned a central role in coping with these problems. Originally, th e justification o f stat e interventio n in th e proces s o f technolog ical innovatio n was primaril y based o n tw o centra l arguments . I t i s generall y acknowledged that , at the enterpris e level , research i s connected wit h consider able external effects. Especially in the case of fundamental researc h i n the natural sciences, third parties ma y use new findings without any market transaction having take n place . A s i n th e cas e o f fundamenta l research, th e marke t economi c principle o f eliminatio n fails: ther e i s n o incentiv e for enterprises , accordin g t o wide theoretical agreement , t o inves t more heavil y in terms o f resource s i n this field (Arrow 1962) . This argumen t is less vali d for applied research: in principle, patent protection - a s well as the chance t o lead i n know-how in the long run provide sufficien t incentive s for investment by private industry. Subsequently, as far as research i s concerned, marke t economic regulation provides an unsatisfactory allocatio n of resources fo r attaining the goal of economi c growth. This shortcomin g i s used t o justify th e fac t that, above all , fundamental

Technology Policy i n the Process of Change 3

research i s not controlle d b y the marke t bu t rather b y th e stat e - i.e . tha t i t is either carried ou t by stat e institution s or at least supporte d b y these, wit h results accessible t o all market participants (Ewers 1990:150) . This i s al l th e mor e tru e i f technological progres s i s claime d t o b e base d o n the "trickling down model " (Hetzler 1970) . Thi s serve s a s the secon d argument for stat e R& T policy . This model implie s that the extent of fundamental researc h substantially influences the opportunities for technological innovation - which , in turn, determines the growth rate of the social product . In the case of an inadequate level o f fundamenta l scientific research , th e redistributio n of resource s toward s this stag e o f technologica l progres s make s i t possibl e t o initiat e a proces s o f national economic growth . Although ther e i s n o doub t tha t a n increas e i n scientifi c knowledge raise s a society's innovativ e potential, its utilization is by n o mean s automaticall y guar anteed. Thi s i s why, in connection with the suppor t of fundamenta l research , th e concept of "conditions providing policy" is used to distinguish it from R&T policy as such (see Boxsel , this volume). Transforming new scientific findings into technological innovation , is basicall y a matte r o f thos e decision s take n b y busines s on how to utilize them. Actions taken at the enterprise level , however, quite often prove detrimenta l t o nationa l economic growth . Therefore , i t seems obviou s t o put the emphasis o f state R& T policy on guaranteeing the transfer of technological knowledge, rather than on encouraging and supporting fundamental research. Such a strateg y prove s rational , especially fo r smal l nationa l economies unabl e to provid e th e enormou s financia l mean s necessar y fo r carryin g out fundamental research . Eve n i n Japan, th e transfe r of moder n technolog y fro m th e leading industrialized nation s was originall y promoted b y th e stat e primarily to initiate a proces s of economic recovery . Onl y recently , afte r Japan' s establishmen t a s a leading industrialized nation, has th e promotion o f fundamental research gaine d in importanc e withi n state R&T policy (see Kawasaki , this volume). In the case of large-scale technologies , th e transformation of scientific finding s is also becoming a problem hardly manageable by the market alone. The massiv e financial requirements resulting from thei r technological and/o r economi c indi visibility, quite often exceed th e capacities of private companies. In such fields as transport technology, space technology, nuclear energy and computer technology, the government s o f mos t o f th e larg e industrialize d nation s subsequentl y fee l compelled t o exten d thei r engagement s i n technologica l innovatio n to field s o f applied research . These fields are closer to the market an d thus avoid the risk of innovative activities being curtailed du e t o the financing problems o f private in dustry. However, the following must be admitted as well: in view of the enormou s research an d development budgets of multinational corporations, th e failure of the market in terms of technological and/or economi c indivisibilit y can be used only to a limite d exten t t o legitimatiz e state researc h an d technolog y polic y (Ewer s 1990:151).

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The additiona l danger of fundamental scientific knowledg e being transformed into technological innovation , only exists if there i s a lack o f information on the probability o f th e succes s o f thes e innovations . This proble m i s gainin g mor e and more in importance: th e profitability o f investment in high-tech research an d development i s har d t o estimat e du e t o th e lon g 'running-in ' periods involved . Although public subsidies may not reduce the risk of failure, they may well reduce related costs . It is argued that, if companies' researc h expenditur e is reduced b y state subsidies, then companies will engage more readily in financial commitments difficult t o calculate in advance (see Braun , this volume). Public support i n these cases, however , i s b y n o mean s a n uncontentiou s issue: i t implie s tha t public institutions are indeed more capable tha n industrial enterprises t o estimate futur e market risks and, accordingly, that the companies' ris k precautions are not justified in case of an appropriate transparency of the market. Reality has proved otherwise: public institutions' estimations of financial risks in the development and marketing of ne w technologie s ar e quit e frequentl y inadequate . Th e resul t o f thi s i s th e permanent necessity of their adopting a role as permanent donors of subventions. As discussion s hav e shown , a public R&T polic y base d o n economic target s is rather limited in its scope of legitimatization. State interventio n in the process of technologica l innovation , however, ma y no t b e justified by th e failur e of th e market argumen t alone. On e shoul d also conside r th e necessit y o f gainin g and maintaining international competitiveness (Rothwell/Zegveld 1980). Competitive enterprises i n so-calle d ke y technolog y area s ar e considere d t o be inevitabl e if technological dependencies detrimental to the national economy are to be avoided. Here, the perspective o f state support does not only refer to fundamental research but also increasingly to the stage o f development at the enterprise level . Public technolog y polic y i n Japan i s especially characterize d b y suc h a n ori entation towards key technologies. Accordin g t o McMillan, "The Japanes e hav e learnt th e lesson s o f th e post-industria l and informatio n revolution an d turne d them t o competitiv e advantage " (1984:64) . Wha t i s characteristi c o f Japanes e R&T policy, is that the economy i s regarded a s a bundle of sectors, branche s and industries. All o f thes e ar e analyze d b y th e stat e wit h regar d t o suc h criteri a a s prospects fo r the future , ne t product or world market potential. Also, a n optimal composition o f th e econom y i s aime d a t by specia l stat e R& T polic y measure s encouraging suc h promising industries as information and data technology, ne w material technology , biotechnology , automati c manufacturing systems, etc . (se e Kawasaki, this volume) . In the meantime , however, a number of other countries have also adopted a n R&T polic y concentrating on the suppor t of key technolo gies. This mean s that national R&T policie s ar e becoming mor e an d more similar . All state s promote the development of the same key technologies, withou t taking into accoun t nationa l specificities or th e characteristic s o f nationa l innovation systems. A t present, a vividly-discussed topic i s the fac t tha t the semiconducto r development is characterized b y considerable structural deficiencies in European

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countries - whic h bears the risk of a European technologica l dependenc e o n the US and Japan. This is why, again and again, the massive subsidization of European companies has been demande d i n the development o f silicon semiconductors . Here again , however, th e legitimac y of public research an d technology policy seems t o be questionable at best. For one thing, the argument of the expedienc y of internationa l division of labou r may b e use d agains t it . Fo r another , i n view of the growing globalization tendencies o f large corporation s an d the increasing number o f strategi c alliance s bein g formed , i t has becom e difficul t t o ascertai n which ar e thos e enterprise s worth y o f suppor t i n term s o f maintainin g national competitiveness. I n the case of semiconductor development , cooperation betwee n a German an d a US corporation a t the expense o f a European one , raise s doubts about th e existenc e o f nationa l or Europe-wid e suppor t o f key technologies . A s shown b y Edquist , this dilemma of publi c technology polic y ma y frequentl y b e encountered in small countries. Traditional research and technology policy, as well as its bases of legitimatization, have been subject to criticism in various respects. First, there is considerabl e doubt abou t th e basic assumption s of the "tricklin g dow n model" . It may by n o means be clearl y prove d whethe r the suppor t of fundamenta l research ove r various stage s o f th e innovatio n process, finall y lead s t o th e developmen t o f ne w marketable products and processes - an d thus, to economic growth . The substantive growt h processe s whic h too k plac e i n th e highly-develope d industrialized countries afte r Worl d War II, ma y no t eve n predominantl y be attribute d to stat e innovation policies. It certainly seems equally justified t o name a variety of other factors a s having caused them . By th e sam e token , ther e i s n o definit e empirica l evidenc e tha t international competitiveness ma y be guarantee d b y means o f state policy. It is true that public researc h an d developmen t subventions are provided massivel y in those areas where individua l industrialized nations hold a particularly strong positio n i n international competition (Krupp 1987). A clear-cut assignment of cause and effect , though, i s hardly possible. Also , on e ma y conside r th e thesi s of plausibl e stat e research an d developmen t policy a s being attracte d b y economi c succes s rathe r than a s causin g it. I n an y case , i t i s difficul t t o prov e th e succes s o f traditional innovation policy with regard t o the objective of initiating economic growth . However, traditional R&T policy is criticized not only because of the uncertain prospects o f success. It is also questioned because of its traditional understanding of technology development an d policy. Economic competitivenes s is exclusively related t o technological progress ; thus, a material conception o f technology pre vails (se e Braun , this volume) . According t o thi s narrow definition , technolog y is understood i n terms of machines and production facilities. Accordingly , public R&T policy concentrates on the support of scientific findings and the development of material technology. However, there i s much room fo r doubt as to whether the competitiveness of enterprise s o n th e worl d marke t depend s exclusivel y on th e modernity of material technology. Conversely, it might b e the other way around:

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as shown by the example o f Japan, organization and management aspects pla y an equally important role. This implies that the traditional, technologically-oriented R&T policy must accept the argument regarding th e limits of its purely technological approach toward s an optimal path to economic growth . At the same time, the question is raised again , though from anothe r perspective, i n how far state interventionism is expected t o interfere in market-oriented stage s o f the technologica l innovation process.

3 Fro m Material Technology to Technological Practice In recent debates on Fordism, it has become clear that the progress i n productivity connected wit h its diffusion wa s no t due to the mer e technica l innovatio n of the conveyor belt: rather, this was possible only in combination with an appropriately adapted work organization and enterprise culture (Boyer 1991) . Mechanization of production, Taylorist principles of work organization and a bureaucratic management concept form an entity, so to say; it is their interaction that can be considered the secret behind the marked stage of growth afte r World War II. Hence, Fordism as a ne w technologica l paradig m wa s no t onl y characterize d b y technological progress, bu t also by changes i n work organization and enterprise culture. This i s a n expressio n o f a change d basi c understandin g of technology . Th e material technolog y concep t i s replace d b y a relationa l on e (Rammer t 1989) . Technology i s define d a s a n organize d syste m o f me n an d machine s i n which scientific findings and experience are applied in the solution of practical problems (cf. als o Dufour t 1991 , quote d i n Abdelmalki/Kirat , thi s volume). I n thi s con nection, Pace y talk s abou t technological practice s (1983:6 ) which , apart fro m a technical dimension, also include both an organizational and a cultural dimension. Technological progres s i s thus a process o f combined techno-organizationa l and socio-cultural innovation. Immediately eviden t when studyin g the specific structure of modern informa tion technology , ar e bot h th e significanc e of a technology concep t extende d b y the element of practice and, simultaneously, the problematic nature of traditional policy. Due to the software element which it incorporates i n addition to the hardware, thi s i s characterize d b y a significantl y highe r degre e o f 'influenceability ' by socia l factor s othe r tha n traditiona l technology. Thi s means , i n other words , that technologica l progres s ma y no t be reduce d t o th e developmen t o f materia l technology; rather , th e way o f structurin g the workin g process vi a the develop ment of software, is an endogenous an d functionall y necessar y constituen t in the development o f technological system s (Naschol d 1986:232) . Serving as the basic assumptio n is , on the one hand, the autonomous development of the technological paradig m in the form of hardware; and on the other, the social paradig m i n the form of software (Dosi 1982) . The utilization of scientific

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findings may alread y hav e resulte d i n the development o f concrete technologies ; however, the systemic combinatio n o f these hardwar e component s wit h relevant software programmes , ca n onl y b e considere d t o b e i n a n experimenta l stage . The sam e i s true, fo r that matter , for the supervisor y structure , the regulation of working condition s an d certai n aspect s o f organizatio n culture . I n an y case , i t cannot yet be foreseen whic h combination of hardware and software components, work-organizational norm s an d enterpris e cultur e pattern s ma y finall y b e con sidered a s th e mos t promisin g technolog y lin e with respect t o productivit y and growth development (se e Badham/Naschold , this volume). The susceptibilit y towards a variatio n of technologica l syste m configurations becomes obvious in the case of the conception o f CIM systems. There, at least two technological practice s hav e developed. Accordin g t o Brödner (1985), ther e i s a technocentric an d anthropocentri c developmen t line ; and accordin g t o Badha m (this volume), a neo- an d a post-Fordist one . Th e two totally contrary systems both o f which differ i n technological structure, machine programming and regulations of work organizatio n - ar e above al l based on different appreciation s o f human labour. A similar argument is used b y Kern an d Schumann, who discove r in thei r analysi s o f ne w productio n concept s a managemen t philosoph y totally different fro m Taylorism . The y ar e influence d by quit e specifi c organizationa l culture patterns (Kern/Schuman n 1984) . The concept of technological practice suggests that the productivity potential of new technologie s ma y be full y exploite d onl y in connection wit h organizational and socio-cultura l innovations . Due t o thei r systemi c o r paradigmati c characte r (Brandenburg et al. 1975 ; Mensch 1977) , the implications of new technologies especially i f based o n advanced electronic s - g o beyond th e sphere of work at the enterpris e level . To allow fo r their efficient application , changes i n a variety of societal institution s have also become necessary. Accordin g to this basic idea , new technologies represen t a scientific developmen t s o powerful that it puts into motion entir e whol e chain s o f technological an d socia l innovation s (see Braun , this volume). In this connection, Nelson and Winter talk about generalized natural trajectories o f technology (1977 , 1982) . In her concept o f "techno-economic paradigm", Pere z also emphasizes th e importance o f th e connection betwee n technologica l progres s an d societa l chang e (1987). Successful techno-economic paradigm s are the result of, on the one hand, the interaction between ne w lines of development; and on the other, both selectiv e mechanisms o f th e econom y an d th e natura l and socia l environment . Before a new technological paradig m ca n lea d t o any substantial productivity rise, i t is argued, a crisis of structural adaptation mus t be overcome. On e should add that old institutions and cultural patterns as well become obsolete; the y correspond to the requirements of the outdated technologica l system. A mis-match occurs betwee n new technologie s and the ol d socia l mode l o f production. Thi s mis-matc h mus t be overcome b y mean s o f institutiona l chang e i f the ne w technologies ' produc tive potentia l i s t o b e full y exploited . B y institutiona l change, Pere z refer s no t

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only t o work organizatio n an d managemen t aspect s bu t abov e al l t o the educa tional system, industria l labour relations, societal valu e conceptions, etc . Crucia l importance is attached to the reform of the system of vocational education in connection wit h the change in paradigm du e to the introduction of new information technologies. Thei r efficien t us e substantiall y depends o n th e degre e t o which employees ar e i n a position t o enter int o activ e dialogue wit h th e technological systems (Loikkanen/Seppälä , this volume). The exampl e o f th e automobil e lend s itsel f onc e agai n t o demonstratin g th e consequences o f paradigmati c technologica l change . Apar t fro m representin g a technological, work-organizationa l an d - a s can easily be checked wit h Ford enterprise-cultural chang e i n paradigm, th e developmen t an d acceptanc e o f th e new transport technology has been similarly and decisively influenced by massive public investment programmes, a s well as the rise in mass consumption via wage and socia l policies . T o carr y thi s exampl e further , th e oi l crisi s ha s no t onl y encouraged ne w engine development but has also le d to the social innovatio n of the "car-fre e weekend" . Finally , massiv e technologica l developmen t initiative s may b e expecte d i n connectio n wit h lega l regulation s fo r th e solutio n o f th e recycling problem. According to what has been said so far, social, cultural and institutional aspect s of work organization at the level of both companies and society may be similarly decisive as technological innovatio n for productivity and economic growth . This seems to be take n into account by shiftin g emphase s withi n publi c R&T policy. While the support of fundamental research continue s to be uncontested, the limits have been extended within which public activities are considered t o be appropriate (OECD 1988) . In view of the centra l importanc e o f technological practice s an d systemic technology structure s for productivity development, i t is argued that effective public innovation policy must comprise considerabl y more functions than the mere financia l suppor t of research an d development or the pilot application of new technologies. I t must be related much more closely to all those factors eithe r hampering or favouring its development or use (Bräunung 1986:264). Essentially, two group s o f factor s ma y be discerne d here : socio-cultura l factors o f wor k organization at the enterprise level , on the one hand, and institutional factors at the societal level on the other (se e Badham/Naschold , this volume). The direct or indirect subsidization of technology development ma y be of less importance for national economic growth than the elimination of barriers to innovation at the enterprise leve l or the support of factors stimulating innovation. This fact has become unconteste d as a basis of legitimatizing public innovation policy. Accordingly, ther e i s consensus i n principl e regarding th e state' s activ e rol e i n establishing bot h infrastructur e and socia l institution s supporting technologica l change. This is the case, for instance, with such economic measure s as guaranteeing a low interest level; eliminating protective tariffs ; providin g efficient traffic , transport or modern communication systems. In the same way, this extends to an economical energ y supply, far-reaching technological standardizatio n or even the

Technology Polic y in the Process of Change 9 extension o f research and educational systems . However , th e question of how far the educational syste m - includin g continuing education - i s to be adapted t o the requirements o f technological progress , is being discusse d quit e controversially. Even stronge r reservation s exis t when it comes to stat e interventio n for th e purpose of re-organizing such social institution s as the system of industrial relations, property right s or social security . The centra l importanc e o f socia l institution s for technologica l chang e lead s to th e deman d no t onl y fo r extendin g bu t als o fo r centralizin g publi c researc h and developmen t policy . A s a consequence , ther e ha s bee n a deman d fo r th e systematic integratio n into public policy of all those policy spheres more o r les s unintentionally influencing technological progress , i.e . transforming implicit into explicit polic y (se e Edquist , thi s volume) . Independentl y o f th e fac t tha t such a polic y perspectiv e i s accompanie d b y enormou s coordinatio n problem s (se e Badham; Aichholze r et al., this volume), the question als o arises o f how far any such dominanc e o f technologica l progres s - a s compare d wit h othe r societa l objectives - i s desirable a t all. The concept o f national innovation systems (se e Dalum, this volume), stressing the very orientation of public R&T policy towards national institutions and cultural patterns, is becoming increasingl y widespread in the literature. This suggests at the very least that the relation between technologica l progress an d the establishment of social institution s should not be understood a s a process of unilateral adaptation - an d accordingly, that there is due justification for maintainin g the independenc e o f individua l publi c policy field s fro m R& T policy. This i n n o wa y means , however , th e discontinuin g of consideration s fo r coordinating publi c policies . Even mor e controversia l tha n th e state' s rol e i n institutiona l adaptation pro cesses and i n providing infrastructure, is its intervention in designing production and wor k processe s a t th e enterpris e level . Ther e i s basi c agreement , however , that th e socia l shapin g o f ne w technologica l system s i s o f eminen t importanc e under the very aspect o f productivity; and this consensus als o extends to the market a s a n appropriat e mediu m fo r th e implementatio n of socia l model s o f wor k organization within a limited range (Naschol d 1986:236) . From thi s perspective , there i s quite a significant scope of intervention for state technology policy. Objections t o th e state' s activ e rol e i n conceivin g th e socia l mode l o f ne w technologies, primaril y relat e t o th e lo w impac t o f supportin g project s o f a n exemplary natur e as a means fo r public R&T policy . This refer s no t onl y to th e structural conservatis m o f busines s enterprise s (Chil d e t al . 1987 ) bu t als o t o the problemati c natur e o f th e transferabilit y of form s o f socia l organizatio n a t the enterprise leve l - an d thus, the model natur e of publicly-subsidized projects. Secondly, the specific sensitivity to state intervention in this field, is due to the fact that intervention into enterprises' productio n and working processes may not be seen under the mere aspect o f productivity growth. Inevitably raised are questions of socia l compatibilit y and ecologica l consequences . Takin g int o account suc h problems an d thu s incorporating non-economi c goal s a s determinants o f public

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R&T policy means nothin g more than questioning the traditional growth-oriented policy pattern and suggesting a complete strategic and institutional re-orientation.

4 Th e Crisis of Growth-oriented R& T Polic y Thus far , the governmen t policy objective o f increasin g socia l welfar e has quite indiscriminately bee n equalle d wit h growt h an d productivit y progress . I n th e discussions in this chapte r so far, however, the decisive argument ha s been tha t a lasting increase i n productivity cannot be achieved by technological innovatio n alone: change s i n enterprises' technologica l practice s an d in societal institutions are also necessary. Th e technological innovations encouraged b y state innovation policy, however , d o no t lea d t o productivit y increases only ; thei r development , as wel l a s thei r application , involv e considerable risk s o f bot h a socia l an d a n ecological nature . Thi s ha s give n ris e t o a n increasin g scepticis m toward s th e traditional objective s o f publi c R& T polic y (se e Braun , thi s volume) . Socia l damage ma y by fa r outweig h productivit y growt h - leading , a s a result , t o a decline in social welfare . It is important to note that social an d ecological risk s are the result not only of the ver y nature of material technolog y as such, but also of its use under specific circumstances. A s ha s bee n show n quit e impressivel y b y Perro w (1984) , th e ecological risk s of modern large-scale technolog y are primarily the result of a lack of mutual adjustment between socia l organization and technological structures . In addition, the hazards to human health as a central social risk are in many cases not due to specific mechanica l properties , bu t rather t o work-organization structure s and excessive performanc e standards . Due t o a specifi c selectivity , th e capacit y o f th e marke t t o eliminat e socia l and ecological risk s is considered t o be extremely low . Consequently, there ar e a number of further examples of market failure which might possibly contribute to considerable shortcoming s o f productio n steerin g (Littman n 1975:52) : externa l effects o f production and consumption, neglect of social and human standards; a s well as differences between privat e and general economi c tim e spans. The externa l effect s o f productio n an d consumptio n increas e dramaticall y in accordance wit h economic an d technological development . Environmental damage - suc h as water and air pollution, the destruction of the ozone layer, as well as the gigantic growth in waste quantities - mak e it clear that many people's quality of life is considerably diminished by technological progress. Impairing the quality of the free goods of water and air as a consequence o f industrial production, raises serious doubt s abou t th e positiv e effect s of productivit y increase an d economi c growth on the general welfare . Scarce resource s may be misdirected i f environmental protection an d improvement ar e lef t t o th e market . Thi s become s easy t o explain when considerin g a s

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1

the entrepreneurial goa l a ratio as favourable as possible betwee n privat e profits and costs. I n line with this goal, the substitution of private costs for societal one s appears t o be quite rational - a t least fro m the entrepreneurial point of view. This applies to the emission of toxic gases in the same way as for discharging contam inated waste wate r into the rivers. As long as the wasteful use of scarce resource s does no t reduce profits , ther e is nothing - fro m the entrepreneurial perspective that speaks agains t the exploitation of nature. Such an externalization of costs ma y mean technologica l progress from th e single entrepreneur's poin t of view; while at the level of society a t large, such behaviour results in reduced socia l welfare . Specific marke t selectivit y become s als o obviou s whe n considerin g human oriented aspect s i n th e conceptio n o f technological practices . A decreas e i n op erational cost s a s a consequenc e o f wor k intensificatio n due t o th e us e o f ne w technologies, is still considered as technological progress in the traditional sense even if this goes hand in hand with physical and psychological strain. This assess ment, though , cannot b e share d o n th e societa l level : there are th e considerabl e social costs , fo r instance , of medica l car e an d huma n capital lyin g idle . Again , costs accrued on the enterprise level during the production process ar e externalized and must be borne b y society a s a whole . Insufficient knowledg e o f the futur e scarcit y of natural resources i s said t o b e the reaso n fo r ye t anothe r for m o f marke t failure . Marke t prices , i t i s argued , are steering mechanism s related t o the present, indicating only current scarcitie s of good s rathe r tha n signallin g future developments . Hence , suc h a short-ter m perspective o f th e marke t inevitabl y lead s t o inappropriat e resource allocatio n and a misdirectio n o f th e innovatio n process fro m th e poin t o f vie w o f socia l welfare. On e argumen t alon g this line refers t o th e insufficien t consideratio n of the needs o f future generation s (Ewers 1990:151) . Such failur e o f th e marke t i s demonstrate d b y th e wa y o f dealin g wit h nonrenewable natura l resources. Th e fac t tha t their availability i s limited , is hardly reflected in market prices as long as the supplied quantities correspond t o demand. In this way, the necessary adjustmen t processes are deferred - whic h may lead to considerable friction and slow-down in growth at a later stage. Only if processes of adaptation to future condition s are initiated at a very early stage, can the expecte d social conflict s b e even somewhat alleviate d (Littmann 1975:57) . The marke t mechanis m contribute s t o environmenta l damage , th e violatio n of huma n standard s an d th e neglec t o f futur e situation s o f scarcity . Thi s fac t suggests th e need fo r further perspectives o n public innovation control. This does not necessarily sugges t renouncing the objective of growth, but rather - an d at the very least - a re-orientation in the policy of growth. There i s th e widesprea d vie w tha t th e developmen t an d applicatio n o f th e new EDP-base d technologie s ma y solv e no t onl y economi c bu t als o ecologica l and socia l problems . Thes e technologie s ar e no t onl y labelle d a s clean : the y are als o suppose d t o lea d t o th e simultaneou s optimizatio n o f economi c an d social objectives . Stimulatin g technological progres s b y supportin g researc h i n

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new technologies - an d possibly in their pioneering application as well - i s thus considered a s a comprehensiv e for m o f stat e interventio n n o longe r requiring any additional orientation towards ecological an d social objectives. Rather, there should be emphasis on maintaining the basic pattern of technology support . Daneke criticize s th e ide a tha t such a conception o f ne w technologies make s them a kin d o f panacea . H e argues , however , tha t these ar e no t unproblemati c from th e ecological poin t of view. In addition, they place high demands on enterprise organizatio n and public infrastructure (see Daneke , thi s volume) while by no mean s leadin g automaticall y to the creatio n o f socially-compatibl e workin g structures (see Badham , this volume). If the welfare-enhancing function o f tech nological progres s i s not t o be impaire d by an y negativ e effects, ecological an d social objectives must explicitly be made the hallmarks of public R&T policy.

5 Th e Role of Technology Policy : Suppor t o r Regulation ? At firs t sight , a simpl e ide a seem s t o provid e a sensibl e orientatio n fo r a typ e of R& T polic y aimin g a t economic, ecologica l an d socia l objectives . Littmann describes thi s basic ide a as follows: Economic-technological innovation s which would not be carried out under the condition s of a (distorted ) empirica l pric e system , bein g considere d unprofitabl e from th e privat e enterprise poin t o f view , shal l b e stimulate d provide d tha t the y contribut e t o workin g towards th e socio-economic optimum. On the other hand, those types o f innovatio n must be discriminated agains t which seem promising of success merely fro m th e financial point of vie w o f privat e industr y but, taking int o consideratio n socia l cost s an d profits , would result in no gain or even in a loss o f people's economic welfar e (Littmann 1975:58).

This basi c ide a seems to suggest a dual R&T policy incorporatin g both suppor t and regulation . "Th e tw o mai n thrust s of technolog y polic y ar e th e suppor t of technology and the regulation of technology. The former stems mainl y from th e desire to strengthen the national economy, whil e the latter is mainly necessary i n order to reduce health and environmental hazards caused by the use of technology" (Braun, thi s volume). Badham (i n thi s volume) refers t o th e partia l inadequacy of thi s rol e assignmen t of th e tw o instruments . Thus, th e developmen t o f ne w technologies - a s mentioned above - contain s certain aspects of regulation; while on the other hand, there are considerable difficulties i n eliminating health hazards via legal provisions regulating working procedures. I t is rather the support of new technologies whic h might lead to more effective results in this area. Putting the above-mentioned ide a int o practice poses considerable difficultie s as well . Abov e all , th e poin t i n tim e a t whic h th e stat e shoul d interven e b y either supportin g or hamperin g th e proces s of innovation , seems t o be a n ope n question. Mayntz/Scharpf give a very good illustration of the problematic nature of suc h a simple recipe a s far as fundamental research i s concerned. I n politics ,

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according t o the authors , it is not possible "t o nurs e the vegetable s an d pul l ou t the weeds : th e sam e root s fee d bot h th e potentia l fo r increasin g socia l welfar e and for jeopardising it " (1990:61). Th e knowledge about nuclear fission, geneti c engineering, o r informatio n storage a s such , ma y no t a priori be categorize d a s supportive or detrimental to social welfare. Thus, the aim of welfare optimization by publi c R&T polic y may no t be achieved b y supporting fundamental research only in those selected fields in which new findings are expected t o be conducive to welfare, whil e withholding support in all those areas wher e new findings conjure up ecological an d social risks . It obviously cause s insurmountable problem s to attempt t o exclude an y negative effects of technological progress, b e they of an ecological o r a social nature , through stat e contro l over fundamental research . I t does, however, seem realistic to orient this research towards finding solutions to existing problems. It is possible to find out which type of knowledge is necessary for solving a given social or ecological problem. Of course, thi s by no means guarantees that an adequate remedy to the problem wil l actuall y be found. On th e on e hand, knowing which kind of scientific knowledge is required, does not automatically guarantee success - eve n if massiv e financia l mean s ar e available for the necessary fundamenta l research . On the other hand , new scientific findings are not immediatel y transformed into the necessary form s of technology utilization. In spite of these imponderabilities, it seem s appropriat e t o assig n t o stat e polic y thre e mai n tasks (Mayntz/Scharp f 1990:63): - generatin g knowledge to find technological solution s to social problems which have not been cause d b y technology itself; - generatin g knowledg e abou t possibl e negativ e sid e effect s o f currently practiced or prospective technological solutions (see also Edquist, this volume); and - generatin g knowledge for minimizing such side effect s and solving problem s arising from former technological practices . What the authors have in mind here, is primarily fundamental researc h i n the field of ecological systemi c relationships. However, their policy conception may easily be transferred to social problems . So , for instance, fundamental research ma y be aimed at finding out where technological practices do not comply with the criterion of social compatibility . Also, research int o the adverse long-ter m effects of work practices can be made the object of fundamental research, in quite the same way as investigating possibilities for confining or totally eliminating such adverse effects. The authors are well aware, however, that the incentive structure currently existing in fundamental research, i s hardly adequate for directing scientific interest towards the investigation of ecological cause-and-effec t relationships. To the contrary, it is systematically designed to neglect interdisciplinary research. In view of this, it can be seen a s the essential task of the state to initiate the kind of institutional change in fundamenta l researc h tha t i s necessar y fo r embarkin g o n interdisciplinary

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problems (Ewers 1990:159-160) . In this respect, some of the developments in the Netherlands seem to be interesting. In the course of the 1970s, special programme s and course s wer e establishe d a t universitie s and othe r researc h institutes . All of these were devoted to investigating the relationships between science, technology and society (se e va n Boxsel, thi s volume). There exists a dilemma of not being abl e to exclude the detrimental effects of technological advance s throug h controlling fundamental research. Its solution is often considered t o lie in a specific model of dualistic R&T policy. There have been attempts to reach the goals of stimulating a level of productivity growth conducive to raising social welfare, a s well as that of maintaining nationa l competitivenes s in the international context by supporting fundamental research . A t the same time, knowledge application is controlled by a variety of forms of state regulation, with a view to avoiding undesired social and ecological consequence s of technological progress - o r at least of limiting possible damag e (Brau n 1984:123) . According to Littmann, it might certainly be much easier to correct an y undesired aspect s of technological progress on the user level rather than trying to establish an optimallystructured developmen t pat h fo r th e econom y a s a whol e vi a th e distribution of researc h fund s (Littman n 1975:59) . I n thi s connection , Collingridg e (1980 ) has draw n attentio n t o th e centra l dilemm a o f control . Thi s i s du e t o th e fac t that, durin g the earl y stage s o f development , technologica l innovatio n may no t be controlle d becaus e o f insufficien t predictability ; while later , a s socia l an d ecological consequence s ma y appear, i t is possible to do so. Control at this stage, however, become s increasingl y difficult, sinc e an y changes ar e extremely costly due to the amount of technological, financial, institutional and cultural investments already made . State regulation may take the form of either laying down concrete lega l provisions o r o f influencin g price-setting : fo r instance , vi a the lev y of taxe s o r othe r charges. Thi s is also described b y the concepts of normative or economic regula tion. Public regulation is discussed abov e al l as a means of achieving ecological objectives. A grea t dea l o f controvers y surround s the issu e o f whic h for m o f regulation is mor e efficien t fo r implementin g non-economi c goal s i n economi c life . B y means o f economic instrument s such as taxes an d othe r charges , producer s an d consumers ar e supposed t o bear thos e externa l costs whic h they themselves hav e caused an d whic h s o fa r hav e bee n pai d fo r b y th e communit y (se e Simonis , this volume) . "Shado w prices " fo r causin g damag e t o th e environment , i t i s assumed, wil l mak e th e rationally-actin g subjects o f economi c lif e us e clea n technologies an d environmentally-benign products so as to avoid the costs arising from lega l requirement s an d pric e hikes . Logicall y speaking , stat e interventio n in th e pric e settin g mechanis m wil l lea d t o th e eliminatio n fro m th e marke t of unclea n technologie s t o b e replace d b y environmentally-benig n product an d process technologies.

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As criticized i n the contribution by Abdelmalki and Kirat , this argumentation has som e weaknesses . On e majo r difficult y i n fixin g 'shado w prices ' lie s with determining th e origins of a specific environmental damage - an d accordingly, discriminating agains t th e technologie s causin g th e damage . I n mos t cases , i t is argued, damage is of complex origins and appears only after some time. Moreover, levies and charge s b y n o mean s invariabl y lead t o the substitutio n of production technologies an d o f product s deprivin g the stat e an d th e environmen t of thei r clean counterparts . Thi s i s primarily a question of how hig h suc h shado w price s are. The problem i s that fixing exact price levels is not possible du e to insufficien t information o n damag e cause d b y a specifi c technology . The y ten d t o b e th e result of biased negotiation s in which typically rather moderate price s ar e fixed, mostly providing little incentive for a change in technological practice s o r buying habits. In addition, the case of futur e generation s i s not take n int o consideration in thi s procedure. O f specia l importance , though , seems t o be the argumen t that trying t o fix a price fo r environmental damage i n principle suggests tha t naturedestructive processe s ar e reversible . However , i n mos t instances , this is no t th e case. Therefore, ecologically-oriente d governmen t regulation by wa y o f price i s in principl e no t suitabl e for solvin g th e proble m o f preventin g environmental damage (Söderbau m 1990:3) . Legal regulatio n also ha s a numbe r of disadvantages . I t has prove d t o inhibi t innovation insofa r as ther e i s n o specia l incentiv e for producer s t o improv e the 'state-of-the-art' beyon d maximu m permissible emissio n levels . The latte r ar e generally fixe d b y th e stat e aimin g at th e developmen t o f cleane r technologies . Those emission s remainin g belo w th e standar d fixe d b y th e state , thu s d o no t incur any costs (Ewer s 1990:156) . Moreover, th e proble m wit h setting emission standards i s tha t thi s mus t b e don e a t a poin t i n tim e whe n th e exten t o f th e individual technologies ' harmfu l effect s i s stil l largel y unknow n (se e Simonis , this volume) . I t come s a s n o surpris e tha t emissio n standard s ten d t o b e to o low: as a rule, the expected damag e i s underrated (Nowotny/Eisikovi c 1991) . In addition, proo f need s t o b e supplie d that the foresee n lega l regulation s actually lead to the desired ecologica l effects . Various authors therefore display a generalized doub t regarding the possibility of efficien t stat e contro l o f knowledg e applicatio n a t th e enterpris e level , b e i t via price or legal regulations (Mayntz/Scharpf 1990:65-66) . This scepticism may be substantiate d by a numbe r of arguments . For instance , it cannot b e exclude d that - eve n b y far-reaching stat e contro l o f knowledge applicatio n - i t is still impossible to prevent the unintended negative side effects of a basically desirable innovation. After all, technological context s hav e become increasingl y comple x and unpredictable. This is also true, for example, wit h the catalyzer, whose us e is certainly les s harmfu l to th e environment but whic h poses substantial , formerly neglected problem s of ultimate disposal. In addition , the thesi s o f controllabilit y o f knowledg e applicatio n i s no t ver y plausible becaus e o f th e fac t tha t ne w scientifi c finding s b y thei r ver y natur e

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constitute a publi c goo d applicabl e o n a world-wid e basis . Stat e regulations , though, do not extend beyond national borders - thus being incapable of preventing certain technologica l developments a s such. Not even within national borders i s it possible t o invariably prevent any damage attributable to technological developmen t by state control o f knowledge applica tion. As can be seen from the example of nuclear energy, such a policy is powerles s as soon a s the damage is due to causes lyin g beyond national borders. Thi s i s true in the same wa y for all those type s of emission whic h cross national borders vi a air or water pollution. In this case, a technology policy based o n regulation can be successful onl y if supranational bodies chec k th e compliance with technological standards an d are also empowered t o impose sanctions . Finally, there are those technologies whic h are unwanted from the supranational point o f vie w bu t whic h ar e o f enormou s advantag e t o individua l states . Thi s is especiall y tru e fo r th e militar y sector . I n thes e fields , nationa l technolog y policy oriente d toward s controllin g knowledge applicatio n canno t achiev e an y satisfactory results. Even if there is a ban on the military use of nuclear technology in individua l countries, thi s canno t hampe r th e furthe r developmen t o f nuclea r weapons. A series of quite similar problems woul d pose themselves to a state technology policy attempting to achieve social objectives by means of controlling knowledge application a t the enterprise level . 'Shado w prices' fo r the use of labour in ways detrimental t o health , fo r instanc e - independentl y of th e difficult y o f settin g them - woul d be problematic primaril y because o f the assumption of health as a renewabl e good . Lega l regulation , o n th e othe r hand , i s confronte d wit h th e problem o f proving the causality between damag e an d specific technologies - an obstacle hardl y t o be overcome. Chroni c disease s ar e primarily the consequenc e of comple x cause-and-effec t relationship s i n whic h th e copin g potentia l o f th e person concerne d play s a substantial role: i n addition, they appear i n many case s only toward s th e en d o f a person' s workin g life . Eve n greate r difficultie s aris e if indicator s othe r tha n health hazards ar e take n a s a yardstick fo r assessing th e criterion o f social compatibility : for example, that of self-realization. Apart fro m th e various forms o f regulation, public contract-placing is considered a n especiall y suitabl e too l fo r implementin g social an d ecologica l aspect s by mean s o f publi c R& T polic y (se e Edquist , thi s volume) . B y virtu e o f th e mere choic e fro m amon g severa l technologie s availabl e on th e market, the stat e might conceiveably influenc e technological development , provided that the level of state demand is of any significance. For instance, vehicles for state institutions might b e purchase d fro m th e poin t of vie w of specificall y ecologica l consider ations. Also , privat e enterprise s whos e productio n organizatio n i s considered a s exemplary wit h regard t o social criteri a migh t be given preference whe n placing public contracts . Admittedly , however, thi s i s onl y a n indirec t wa y o f steerin g technological progress .

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Of much greater significance is the placing of public contracts with the object of providing specific research an d development results. There are special advantages to this way of exerting public influence: th e expected research an d developmen t results ma y b e specifie d i n detail ; th e instrumen t of contract-placin g ma y b e used i n a highl y flexibl e way; an d th e state , throug h compilin g th e contracts , has th e possibilit y of securin g itsel f rather far-reachin g rights to controlling th e innovation proces s (Littman n 1975:210) . However , i f thi s instrumen t is t o b e used successfully , there mus t b e a guarante e o f interes t o n th e par t o f private enterprises t o take on contracts from the state . What i s decisive here, i s whether the state monopolizes paten t rights to research and development result s or whether those are also at the disposal o f the contracting enterprise . The chance s fo r puttin g greate r emphasi s o n socia l an d ecologica l aspect s by mean s o f placin g researc h an d developmen t contract s ar e relativel y goo d within publi c R&T policy . Ther e are , however , som e problem s wit h usin g this instrument which must not be overlooked. Let us mention here only the difficult y of a technically-adequate specification of research an d development contract s by public institutions. As a rule, it cannot be taken for granted that there is sufficien t qualified staf f wit h th e specifi c knowledg e require d fo r carryin g ou t thi s tas k satisfactorily. Therefore, i n specifyin g contracts an d definin g th e criteri a of ecologica l an d social objectives , th e stat e usuall y has to rely on external know-how. This, how ever, involve s the ris k o f expertiz e bein g provide d fro m th e poin t of vie w of a later participatio n in a cal l fo r tenders . I n orde r t o minimiz e such a conflic t o f interests, i t seems reasonabl e t o split the process o f placing public contracts into several steps . Still , th e proble m remain s tha t thi s instrumen t migh t be o f quit e limited efficienc y fo r orientin g technological innovatio n towards ecological an d social objectives, due to the insufficien t technica l qualification o f state actors .

6 R& T Policy a s a Social Experiment In vie w of th e problem s pointe d ou t s o far , i t seem s necessar y fo r publi c R& T policy t o adop t ne w approaches . Undoubtedl y of bu t limite d success woul d be a technocrati c polic y trying to achiev e ecologica l an d socia l aim s by mean s o f interfering i n the market mechanism or the improvement of regulatory practices. Such a re-orientation can only be initiated by a change in political decision-making culture and b y th e development o f ne w political decision-making structures and institutions. Regarding th e chang e i n politica l decision-makin g culture primaril y with a view t o takin g int o accoun t ecologica l objectives , a numbe r o f demand s hav e been expressed (Ewer s 1990:156-157 ; Simonis, this volume):

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- th e obligation of the emitter to prove as non-harmful th e effect o f emissions; - th e acceptance o f heuristic methods of decision-making, since cause-and-effect relationships are insufficiently known; - th e individual obligation to automatically reduce permissibl e standards; and - givin g priority to less optimistic prognoses . Quite similar demands can be made on state policy to take into consideration socia l objectives o f technolog y development . T o giv e onl y on e example , enterprise s should be obliged to prove that specific technological practices ar e not detrimental to health. I n addition, abandonin g th e proof o f causality o f work-related illness , may be conceived as a basis for political decisions. There i s some doubt, however, as to the feasibility of actually implementing such change s i n political decision making culture. This explain s an approach which , unlike the call for a change in public decision-making culture, does no t aim a t an automatic expansion of state control o r regulatio n ove r th e dynamic s o f technologica l development . Rather , it choose s t o ai m a t a redefinition o f the condition s for legitimatizin g regulatory policies (Nowotny/Eisikovi c 1991). It would certainly be asking too much to assign to the state the role of central societal control - includin g the definition of basic technological developmen t lines , the establishment and administration of comprehensive research and development programmes, and the control of knowledge application at the level of society. One factor would be the immense coordination problems involved in such a process. I n addition, as previously mentioned, it is these very technical qualification barrier s that presently spea k agains t such state dominanc e in the technological innovation process. Thus , a re-orientatio n o f publi c R&T polic y mus t i n th e firs t plac e b e accompanied b y a redefinition o f the state's role i n the technological innovation process. Thi s shoul d primaril y be base d o n coordination , integratio n and infor mation. There is more or less unanimous agreement i n professional literatur e that public R&T polic y ca n by no mean s remain restricted t o either supporting technological knowledg e o r t o controllin g its application . I t seem s t o be th e state' s central task t o create a consensus o n socially-desired an d undesired line s of technological development - no t least because of the far-reaching social consequence s primarily due to the systemic character of new technologies (Bräunun g 1986). At the sam e time , this means tha t ne w decision-making structures shoul d not only aim a t integratin g externa l expertis e bu t als o a t mor e incorporatin g democrati c elements. The establishment of technology assessmen t centre s is generally considered a n essential institutiona l innovation aiming a t simultaneousl y pursuin g economic , ecological an d socia l end s withi n th e scope of publi c R&T policy . However, the days see m t o b e ove r whe n on e witnesse d th e heyda y o f a typ e o f technolog y assessment oriente d toward s risk assessment i n mere term s of quantity. There ar e several reason s fo r this. Firstly, risk assessmen t b y various experts - especiall y in th e early stage s o f the process of technological innovatio n - hav e prove d t o

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be widely diverging. This make s i t clear tha t risk assessment i s highly dependen t on th e subjectiv e interpretations an d interest s o f experts . I n addition , risk s o f a social o r ecologica l typ e ar e ofte n connecte d wit h specifi c technological prac tices rathe r tha n wit h a specifi c materia l technology . Here , however , a purely technocratic ris k assessment i s impossible. Finally , the traditiona l form o f tech nology assessmen t - a s a rule characterized b y centralization, bureaucratization and expert-orientation - lack s the democratic element . This is due to the serious social impact o f new technology systems , on e decisive fo r an R&T polic y base d on consensus . The impossibilit y o f objectivizin g technologica l risk s involve s th e dange r of specific interest s being imposed , eve n i f unintentionally , by wa y o f technolog y policy. Ther e ar e variou s decision-makin g approache s designe d t o avoi d thi s problem. Especiall y i n the USA , publi c R&T polic y is based o n th e instrument of concurrent expertise. On e has to admit, though, that those view s perceived a s too critical are often exclude d from the opinion-forming process: eithe r they lac k the convincing lobby or the necessary resource s fo r scientifically sustainin g their ideas. To compensate fo r this, public R&T policy would have to be committed to increased suppor t for 'alternativ e research institutes' . The proble m o f orientin g th e technologica l innovatio n process toward s so cial an d environmental concerns, ma y no t be solve d b y mean s o f expert advice : this typ e o f technolog y assessmen t continue s t o b e base d o n th e ide a o f direc t regulatory-interventionist control b y th e state . However , thi s mean s tha t there i s no direct lin k betwee n technolog y assessmen t an d the development o f new - o r the improvement of existing - technologies . Ther e i s no direct input of knowledge on socia l an d ecological risk s into the technological innovatio n process; only an indirect one exists, via government measures. Moreover , technologica l practice s largely defy th e logics o f state interventionism . These include, apart form technical, also organizational and cultural aspects. Thus , public R&T policy must watch out for alternatives to the classical centralis t technology assessmen t mode l base d on expert knowledge. Such ne w form s o f technolog y assessmen t hav e alread y starte d t o appea r o n the horizon. At the enterprise level , those directl y concerned ar e increasingly assigned a n expert role in the techno-organizational restructuring of production an d work processes. Their experience wit h regard t o social an d ecological impact s of technology i s thus immediately integrated int o the technological innovatio n process (Naschold 1986 ; Badham/Naschold, this volume). At the level of society, the institutionalization of a democratic dialogue between variou s social groups and institutions constitutes a form of technology assessmen t (Nowotny/Eisikovi c 1991) . The idea of "Constructive Technology Assessment" , a s spread b y the Netherlands Organization for Technology Assessmen t (NOTA ) in the Netherlands, i s anothe r indication of change in the forms of technology assessmen t (se e va n Boxsel, thi s volume).

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Characteristic o f thi s chang e i s th e transitio n fro m publi c regulatio n t o th e self-regulation o f technological innovation s (Latniak/Simonis, this volume). The state - o r rather, th e institutions established b y the state - confin e themselve s primarily t o the rol e o f providing the necessar y condition s for experiments o f a socially- and environmentally-oriented technology developmen t an d application. Thus, fo r instance , i t ma y b e regarde d a s th e centra l elemen t o f constructiv e technology assessment, t o provide for the networking of researchers, innovators and othe r socia l group s according t o the idea of a socio-technical - a s well as to strengthen the mechanisms of communication and cooperation. Organizing such a dialogue pursues the aim of integrating a maximum of social perspectives and interests into the innovation process at a stage as early as possible. Accompanying investigations o n socially - an d ecologically-oriente d technologica l innovations , shall certainly provide additiona l input into the socia l dialogue. In this way, this is a t leas t th e intention , a continuou s learning proces s wil l b e se t int o motion. Moreover, b y mean s o f th e wides t possibl e diffusio n o f th e knowledg e thu s gained, there will be a heightening in social awareness of the social and ecologica l problems o f technological progress. Quite similar aims to the concept o f constructive technological assessmen t ar e pursued b y the North Rhine-Westphalia n programm e 'Ma n an d Technology Socially Acceptabl e Shapin g o f Technolog y (SoTech) ' (Latniak/Simonis , thi s volume) a s wel l a s b y th e 'Integrate d Environmen t Programme' develope d b y the Environmental Protection Agenc y (EPA ) in the USA (Daneke , this volume). As fa r a s the scop e o f expansion o f suc h R&T polic y i s concerned, ther e i s due cause for scepticism. Many state-supported socia l and ecological experiment s are far fro m havin g model character, an d there i s hardly ever a diffusion throughou t society a t large. Nevertheless , suc h experiments see m t o contribute to a cultural change, in increasing people's awareness of the social and ecological aspect s of technology developmen t an d utilization.

7 Conclusio n Since it s onset, public R&T policy has undergone considerable change . The new understanding o f technolog y ma y serv e a s initia l evidenc e o f this . Whil e stat e intervention wa s originall y aimed a t materia l aspect s only , now organizationa l and cultura l aspects ar e increasingl y taken int o consideration. Th e objec t i s no longer pure material technolog y bu t rather technological practices. Moreover , t o an ever-increasin g extent , socia l an d ecologica l aspect s ar e integrate d int o th e objectives o f public R&T policy, despite its original exclusive orientation towards economic growth. Rather than being predominantly oriented towards fundamenta l research, th e scope o f state interventionis m increasingly includes those stages of the technological innovation process tha t are more closely linke d to the market .

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While public R&T polic y wa s originally part o f economic policy , it is gradually developing int o a n independen t polic y field closel y interlinke d with such fields as educational , financial, industria l and labou r marke t polic y - t o nam e jus t a few . Formerl y implici t technology polic y i s thu s mor e an d mor e developin g into explicit technolog y policy , whic h means tha t technologica l aspect s are also considered i n the for m o f stat e influenc e on these polic y fields . Finally , the rol e of th e stat e i n th e technologica l innovatio n process i s als o undergoin g change . While the state originally understood itsel f to be the central actor trying to impos e specific technologica l developmen t line s by mean s o f suppor t an d regulation , it has recently rather turned int o a facilitator and coordinator providing institutiona l arrangements for the self-regulation of technological innovation . This ca n also be called a transition from direct to context control. I n the following overview, som e significant characteristic s o f traditional and modern technolog y policy shall onc e again be compared . Table 1: Characteristic s o f traditional and moder n technolog y polic y Traditional R& T policy Moder

n R& T polic y

Object

Material aspect s (material technology )

In addition, organizational, institutional an d cultural aspects (technological practices )

Objective

Economic growt h

In addition, social an d ecologica l compatibility

Stage of technologica l innovation process

Stages of little bearin g on the market (primaril y fundamental research )

Also stages closer to the marke t (technology transfer )

Policy integratio n

Part of economic polic y (largely implici t R&T policy)

Independent policy-fiel d closely interlinked with other polic y areas (increasingly explicit technology policy )

Role of the stat e

Central acto r o f techno logical innovatio n process

Facilitator and coordinato r o f the self-regulation o f the innovation process

Instrument

Support, regulatio n

Provision o f infrastructure

Policy typ e

Direct contro l

Context contro l

It goes without saying that this is a presentation o f ideal types. I n reality, R& T policy i n th e individua l countrie s i s a combinatio n o f traditiona l an d moder n elements. However , on e may clearly observe that such aspects as context control,

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explicit policy, the combination with other policy fields, integration of social an d ecological objectives, greater closeness t o the market, and technological practice s are al l indee d increasingl y becomin g constituen t elements o f th e R& T policie s of individua l countries. Nevertheless , th e developmen t o f a ne w typ e o f public intervention in the technological innovatio n process cannot yet be concluded.

References Arrow, K. (1962) The Economic Implications of Learning by Doing, in: Review of Economic Studies 29 (80): 155-173 . Boyer, R. (1989) New Directions in Management Practices and Work Organization, paper at the OECD Conference "Technological Chang e as a Social Process" , Helsinki. Brandenburg, A.G. , P . Brödner, H.W . Hetzler , G . Schienstoc k (1975 ) Di e Innovationsentscheidung. Bestimmungsgründe für die Bereitschaft zur Investition in neue Technologien, Göttingen: Otto Schwartz. Braun, E. (1984) Wayward Technology, London: Pinter Publishers. Bräunung, G . (1986 ) Ansätze , Konzepte un d Instrument e staatliche r Technologiepolitik , in: H.-H . Hartwic h (ed.) Politik un d di e Macht de r Technik, Opladen: Westdeutscher Verlag, 264-277. Brödner, P. (1985) Fabrik 2000 -Alternative Entwicklungspfade i n die Zukunft de r Fabrik, Berlin: Edition Sigma. Child, J. , H.-D . Ganter , A. Kiese r (1987 ) Technological Innovatio n an d Organizational Conservatism, in: J. Pennings , A. Buitenda m (eds.) Th e Development an d Diffusion o f Microelectronics, Cambridge , MA: Ballinger, 87-115. Collingridge, D. (1980) The Social Control of Technology, New York : Martin's Press. Dosi, G . (1982 ) Technologica l Paradigm s an d Technologica l Trajectories , in : Research Policy 11 : 147-162 . Dufourt, D. (1991) Les politiques technologiques: une nouvelle rationalite de interventio n de 1'Etat dan s l e System e productif?, in : J . D e Brandt , D. Fora y (eds. ) devaluation economiaue de la recherche et des innovations technologiques, Paris : Edition du CNRS, 351-380. Ewers, H.J . (1990 ) Marktversage n un d Politikversage n al s Legitimatio n staatlicher Forschungs- un d Technologiepolitik , in : H . Krup p (ed.) Technologiepolitik angesichts der Umweltkatastrophe, Heidelberg : Physica, 147-160 . Ewers, HJ. , T . Wein (1989) Gründ e un d Richtlinie n fü r eine Deregulierung , Discussio n Paper No. 139 , Berlin: Technische Universität. Hetzler, H.W . (1970) Soziale Strukturen de r organisierten Forschung, Düsseldorf: Westdeutscher Verlag. Kern, H. , M . Schuman n (1984) Da s Ende de r Arbeitsteilung? Rationalisierung i n de r industriellen Produktion, München : Beck. Krupp, H . (1987 ) Forschungspoliti k un d international e Wettbewerbsfähigkeit , in : Fraunhofer-Gesellschaft. Jahresbericht 1986, München : Fraunhofer-Gesellschaft , 64 66. Littmann, K. (1975) Die Chancen staatlicher Innovationslenkung, Göttingen : Schwartz.

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Mayntz, R. , F.W . Scharp f (1990) Chance s an d Problem s i n th e Politica l Guidanc e o f Reseearch Systems , in : H. Krup p (ed.) Technologiepolitik angesichts de r Umweltkatastrophe, Heidelberg : Physica, 61-83. McMillan, C. (1984) The Japanese Industrial System, Berlin , New York: de Gruyter. Mensch, G. (1977) Das technologische Patt, Frankfurt/Main : Fischer . Naschold, F. (1986) Politik und Produktion. Thesen zu Politik und Technologieentwicklung, in: H.-H . Hartwic h (ed. ) Politik un d di e Macht de r Technik, Opladen : Westdeutsche r Verlag, 231-241 . Nelson, R. , S . Winte r (1977 ) I n Searc h o f a Usefu l Theor y o f Innovation , in: Research Policy 6(1) : 36-75. Nelson, R., S. Winter (1982) An Evolutionary Theory of Economic Change, Boston: Harvard University Press . Nowotny, H. , R . Eisikovi c (1991) Entstehung, Wahrnehmung un d Umgang mi t Risiken, Bern: Schweizerischer Wissenschaftsrat. OECD (1988 ) New Technologies i n the 1990s: A Socio-economic Strategy, Paris : OECD. Pacey, A . (1986) Th e Culture o f Technology, Cambridge , MA : MIT . Perez, S . (1987) Micro-Electronics, Lon g Wave s an d World Structura l Change, in : World Development 1 3 (3): 441-463. Perrow, C. (1984) Normal Accidents: Living with High Risk Technologies, Ne w York: Basic Books. Rammert, W . (1989) Technisierun g und Medie n i n Sozialsystemen . Annäherun g an ein e soziologische Theori e de r Technik , i n P . Weingart (ed. ) Technik al s sozialer Prozeß, Frankfurt/Main: Suhrkamp , 128-173 . Rammert, W . (1990) Telefo n un d Kommunikationskultur . Akzeptanz und Diffusio n eine r Technik i m Vier-Länder-Vergleich , in : Kölner Zeitschrift fü r Soziologie un d Sozialpsychologie \: 20-40. Rothwell, R., W. Zegveld (1980 ) Innovation an d Technology Policy, London : Pinter. Söderbaum, P . (1990) Nationa l and Privat e Environmental Policy, paper a t "Annua l Con ference of the E. A.E.P.E.", Florence .

From Socio-economi c t o Socially Oriente d Innovatio n Policy Richard Badham

1 Introductio n In th e mid-1970s , Ernst Schumache r (1974:1 ) proclaimed tha t "The proble m o f production has not been solved". By this he meant that despite th e appearance o f affluence, th e modern path of development was undermining its own foundations by destroyin g tw o o f it s key requirements: it s natural and human resources. An economics "a s i f people mattered " would , he argued , broade n th e criteri a use d by thi s "disma l science " t o includ e thes e tw o ke y elements . I n recen t years , assertions suc h as thi s have move d ou t o f the aren a o f wha t could b e calle d th e culture of protest and into the culture of power (Mathews 1988). Rather than being interpreted a s a social protest agains t industrialism per se , the renewe d concer n with ecolog y an d "human " wor k is commonly understood a s a key requirement for the successful transition to a new stage of industrialism. Unlike the 'post-industrial ' rhetoric, this new stage i s correctly see n a s involving a radical reassessment o f the nature of manufacturing - no t a gradual declin e in it s significance . Although many o f th e 1970 s socia l concern s o f technolog y policy hav e been subordinate d to the commitment to '^industrialization", thes e concerns hav e emerged ane w as a major consideration in economically oriented policies. Thus, in a recent overview of the technology policy context, Schmandt (1989) emphasize s tha t th e assembl y lin e an d th e organize d R& D laborator y were th e tw o ke y technica l innovation s of th e Secon d Industria l Revolution , in which industries based on steel, electricity, chemicals and the internal combustion engine wer e o f central priority . While economic polic y wa s concerned wit h the overall regulatio n o f demand fo r mass-produce d goods , science an d technolog y policy wa s oriented toward s th e 'engin e of technological change ' b y stimulating R&D t o u p t o 3 % o f GNP . I n contrast, th e presen t thir d stage o f industria l de velopment i s led by th e new science-based industrie s (microelectronics, nuclea r physics, information science, genetics). Key focuses of technical concern ar e the improvement of materials an d the conservatio n o f scarc e natura l resources; an d the combinatio n of compute r with telecommunications technologies i n revolu tionizing th e generation , transmissio n an d us e o f information . In addition , th e capacity an d demand fo r non-standardize d high-tech production results in orga -

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nized R&D being displaced fro m it s past role as primarily a 'front end' inpu t into the innovatio n process, t o a ne w role , continuall y intervening in the innovation process in closer collaboration with production and marketing. The result of these developments i s a rol e fo r economicall y oriente d technolog y polic y that incor porates environmenta l and energy concern s as well as the creation o f innovative work and organizational forms for the new 'informated' workplac e and integrated scientific-industrial establishment . In th e fac e o f thes e developments , technolog y policie s ar e slowl y changin g to mee t th e demand s an d help shape th e ne w era. However , a s we are currently seeing i n Eastern Europe, institutiona l changes can take on a dynamic that leaves ideas an d policies fa r behind. Even more significantl y fo r the presen t dilemmas facing technolog y policy , I would argue, is that quite often idea s can change and become partially embodied i n the conventional wisdom, long before they become embodied i n concrete governmenta l institutiona l an d policy changes . I n a sense , I believe, this i s the situation today. In the face of the changes outlined, we have witnessed th e collapse i n the intellectua l realm of two key underpinnings of traditional policy analysis : the R&D Push Model o f technological development and the Dualistic Model o f technologica l polic y a s divide d int o two separat e area s of techno-economic promotion and socially oriented regulation. This is indicated by th e numerou s calls fo r a n increas e i n fundin g fo r diffusio n an d technolog y transfer, th e adoption o f a more "systemic " approach t o science an d technology policy, the establishment of radically new links between the education and industrial systems, the promotion of new "organizational technologies", th e integration of energy-savin g concern s wit h economic-oriente d technolog y promotion , an d the establishment of more "proactive" forms of technology assessment, etc . Yet th e recognitio n o f th e importanc e o f suc h issue s ha s onl y begu n t o b e accompanied b y the adoption of coherent policie s an d institutional mechanisms for thei r promotion . A s describe d i n th e othe r chapter s i n thi s book , however , there ar e a numbe r of importan t an d interestin g initiatives currently underway. These face a number of obstacles, eve n active sources o f opposition, tha t have to be overcom e fo r suc h development s t o proceed an d expand. Som e o f thes e ar e created b y th e traditiona l divisions draw n u p betwee n ministries , others b y th e politically controversial natur e of the changes required, and others by the intrinsic policy difficulties o f adopting a broader approach t o technology policy. The ai m o f this paper i s to examin e these development s i n the context of th e human resources rathe r than the natural resources area . Th e focus is on technol ogy policy concerns directl y related t o the changes wrough t by the combination of compute r technolog y wit h communications . I n particula r th e focu s o f m y discussion wil l be on the promotion o f changes i n manufacturing production organization and skills in order t o assist technologica l innovatio n and diffusion. I n its broades t sens e thi s could b e referre d t o a s "socio-economi c innovatio n policy" i n the manufacturing sphere. I n the view of many - from , amongs t others , work humanization programmes, department s concerned wit h educatio n and in-

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dustrial relations, and trade union s - thi s represents an important opportunity to explicitly orientat e technologica l innovatio n towards socia l ends . I f successful, such initiative s coul d b e describe d a s a mov e toward s "sociall y oriente d innovation policy" . I n th e pas t reference s hav e bee n mad e t o simila r initiative s i n England an d German y a s "sociall y directe d innovation " (Elliott 1986 ) an d "so cially oriente d researc h an d developmen t policy " approache s (Naschol d 1980) . This chapter examine s these approache s i n the context of current developments in technolog y polic y i n Europe , wit h a particula r focu s o n experience s i n th e promotion of "human centred" o r "anthropocentric" production systems.

2 Socio-economi c Innovation Policy 2.1 Conventiona l Wisdom If we take statements fro m management journals, consultants recommendations, governmental reports , an d trad e unio n o r industria l association publication s as an indicatio n o f industry' s 'conventiona l wisdom' , i t woul d appea r tha t th e importance o f th e huma n facto r i n successfu l innovatio n is no w full y recog nized (Hayes/Jaikumar 1988 ; Walton/Susman 1987 ; Weiner/Brown 1989; OEC D 1988b; ACTU 1987 ; BMFT 1990) . Similarl y to Margaret Thatcher' s clai m that "the Cold War has now been won", ther e seems to have been victory in the human factors battle , at least a t the leve l of public displays of conventional wisdom. As detailed by a leading US information technology expert, US firms have an annual 12% increase in their data processing budget, but only 2% productivity increases they are therefore being directed to spend more attention to the 'human element'. This has been apparen t a t four differen t levels . Firstly, it is widely asserted tha t the effective us e of new technologies requires , in th e word s o f th e Harvar d Busines s Review , "Peopl e Policie s fo r th e Ne w Machines". A s a result of the cost, interdependence, an d flexibility of new microelectronics base d equipment , its effectiv e us e require s an increas e i n th e skills , responsibility and motivation of system users. Sophisticated and flexible technology, i t is commonly said, require s sophisticate d an d flexibl e users . Thi s issue i s confirmed i n a variety of opinion surveys of managers, who lis t the lack of skills as th e primar y obstructio n t o effectiv e technolog y introductio n (Danie l 1987 ; McLoughlin/Clark 1988) . Secondly, i t is often state d tha t the tren d toward s computer-integrate d manu facturing i s primaril y a n organizational based rathe r tha n a n equipment-base d change. I n a modification of the GIGO rule ("garbage in , garbage out") , ther e is an awareness tha t if the business organization is inefficient, th e automation of inefficiency wil l provide little benefit. It is frequently commented by firms that have introduced the new structures that it was the organizational changes that provided

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the most benefit. No t only is there an acceptance o f the slogan "N o CIM without HIM" (o r HER) but the organizational component o f integrated manufacturin g is seen a s the most importan t but the most difficul t t o implement. Thirdly, i n technolog y policy circles th e processe s of technolog y diffusion o r transfer ar e now widely recognized a s a crucial component o f technological development. I n particular, many countries, especially th e smaller ones, emphasiz e the significance of technology adoptio n rather than technology leadership strate gies, i.e . the importanc e withi n technology polic y o f an emphasis o n promoting national capabilities in the area of the evaluation, adaptation an d development of foreign technologies . Moreover, within this area importance is attached to the organizational and skill components of effective diffusion. The OECD 1988 Science and Technology Outlook stated , for example, that policy i n these areas shoul d include (all) steps taken to increase the economic efficienc y wit h which the new technolog y is utilized. These migh t include reorganization o f factor y wor k an d material s flow s (suc h as just-in-time programmes), improve d managemen t practice s an d increase s i n educatio n and skills i n the firm's labour force. In contrast t o tangible investments in physical capital, these represen t investment s in organizational and huma n capital. They ma y b e critica l to capturing the economic potentia l of new technology, even though they have not traditionally been viewe d as directly connected t o science an d technology policy (OEC D 1988b:51) .

This concentratio n o n th e diffusio n proces s doe s no t exclud e R& D funding , however, bu t rathe r direct s thi s fundin g t o th e adaptatio n an d developmen t o f received technologies . Fo r thi s reaso n th e ter m 'socio-economi c innovation ' i s used i n this paper to refer to the institutiona l processes involve d in the selection , adaptation an d development of commercially available technologies . Fourthly, a s represente d i n th e call s fo r a systemic approac h t o technolog y policy (Sweene y 1985) , a broader understandin g has develope d o f th e rang e of factors influencin g th e diffusio n process . I t i s recognize d tha t th e direc t o r in direct fundin g o f technolog y promotio n o r diffusio n activitie s ma y b e o f les s significance tha n the modification o f environmental variables that either obstruct or facilitate diffusion. Thes e include such familiar factors as the high real cost of capital, lack of technical standards whic h increase adoption costs , lon g deprecia tion periods fo r capital equipment, government regulations that promote th e use of inferior domestically-produced technology , the shortage of technical personne l acquainted wit h technology, the unfamiliarit y o f management wit h the potentia l of technology , an d entrenched organizationa l and work practices . A s the OECD Outlook commented, however, possibly "the mos t commonly cited barriers relat e to inadequat e huma n capita l an d concer n th e scarcit y o f appropriatel y skille d technical and managerial personnel" (OEC D 1988b:76) .

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2.2 Institutiona l Implementatio n Despite thes e change s i n th e conventiona l wisdom , however , th e practica l im plementation o f these idea s i s frequently less dramatic. Firstly , as discerned i n a number of industry studies, personnel an d industria l relations manager s i n firms are frequently not involved in early discussions of technological innovation , and are consulted only late on in the process. Secondly, ergonomists or human factors engineers ar e no t onl y regarde d a s o f littl e significanc e by designer s bu t thei r weak organizational location prevents them from imposin g their ideas on the design process. Thirdly, trade union involvement in technological change, especially as measure d b y thei r involvement in technolog y agreements , i s frequentl y 'too little, to o late' . Eve n wher e the y ar e no t activel y excluded fro m interventio n at an earl y stage , the y ar e frequentl y constraine d b y inadequat e time , limite d re sources, an d th e restricte d focu s of man y of thei r member s o n job securit y and working conditions. Fourthly, management - particularl y line management - stil l has a stron g interes t i n an d focu s o n th e contro l o f th e workforce , an d thi s i s frequently embodie d i n the development of system elements tha t enhance techni cal control even a t the cost of restricting organizational learning . Such obstacle s have prove d t o b e extremel y formidabl e when combine d wit h othe r source s o f resistance created by inadequate management strategic planning, the imbalance d conflict betwee n financia l an d design/R& D managemen t an d productio n man agement, th e oppositio n of middle management an d plannin g department t o th e devolution of functions, etc . At the governmental policy level the obstructing factors are no less significant . An examinatio n of th e scienc e an d technolog y polic y fundin g i n OEC D countries, reveal s a clea r predominanc e o f invention/innovatio n fundin g rathe r than innovation/diffusion. Th e OEC D ha s attribute d thi s t o a variet y of institutional obstructions, including the fact that technology developmen t policie s fo r th e suppl y o f technolog y ar e administrativel y more attractive tha n thos e fo r diffusio n an d demand . Technica l objective s ca n generall y b e specified mor e easil y tha n marke t objectives an d are perhap s mor e consonan t wit h thos e who have technological rather than economic backgrounds. It is also likely to be easier, bot h administratively and politically, to manage publi c funding fo r the supply of R&D tha n the demand fo r innovations. The latte r can involve sensitive areas such as tariff dismantlement, restructuring o f ta x regime s an d investmen t incentives, changing managemen t attitudes , reducing rigidities in the labour force an d so on (OECD 1988b:54) .

Institutional difficultie s ar e eve n mor e pronounce d whe n a n emphasi s i s place d upon the organizationa l and skil l component s o f diffusion. Scienc e an d technol ogy policy departments ofte n have little experience wit h dealing with education , training an d industria l relations issues , whil e th e othe r department s concerne d with these issue s have a similar lack of expertise i n technological innovation and diffusion processes . A s a result, programmes fo r the promotion of skills and organizational change for new technologies ofte n take the form of technology policy

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department initiative s oriente d t o th e direc t practica l problem s experience d b y industry with little integration into the overall structure of education and training, while educatio n an d trainin g departmen t initiatives represent length y processe s of transformin g educational structures in a manne r that i s ofte n condemne d fo r its lack of knowledge of or concern with immediate industry requirements. This general concern with diffusion an d its organizational and skill components compounds the traditiona l proble m o f coordinatin g a central technolog y polic y with the activities of other ministries that control importan t areas o f technology. In orde r t o systematicall y address thes e issues , integration is require d betwee n all those ministries wit h responsibilities fo r factors tha t bear upon this process and tha t includes, i n particular, education an d trainin g ministrie s and industrial policy ministries , as wel l as othe r sometime s ke y ministrie s with responsibility for area s o f scienc e an d technology suc h as transport, communications, energy, public industries, etc. Yet each of these ministries have their own histories, traditions and interests, and while both industry and education/training ministries have programmes tha t have implications for diffusion, an d sometimes directly addres s these issues , the y are often inadequatel y coordinated wit h technology ministries and innovation/diffusion policies . As a result the challenges of a systemic technology policy that directly addresses the requirements of socio-economic innovatio n or diffusion processe s ar e immense. This i s especially significant give n th e existence withi n industr y o f th e powerfu l factors, outlined above, tha t obstruct this process. 2.3 Sociall y Oriented Technology Policy The attemp t by technology policy-maker s to grapple wit h thes e issue s of socio economic innovatio n occurs withi n a quit e specifi c context. I n th e fac e o f th e changes outline d in th e introduction , and th e direc t threa t o f "deindustrializa tion", th e general emphasi s o f technolog y polic y ha s shifte d - fro m th e mor e "socially" oriente d initiative s i n the lat e 1960 s an d 1970s , to a greater concer n with adapting the science and technology system to the radically new "demands " of '^industrialization". For some critics this had led to a "new politics of science" that, by promoting indirect funding and using tax relief mechanisms, substantially reduces public control over science and technology (Dickson 1984) . Other critics have observed that it involves a move towards a "techno-corporatism" that creates an expert elite stratum of policy-makers that reduces the traditional role of interest group bargaining in the formulation of policy (Fischer 1988) . Drawing o n a numbe r of experience s i n countrie s suc h a s th e Unite d States , Great Britai n an d Australia , these perspective s regar d governmen t claims to b e taking socia l factor s int o consideratio n i n th e innovatio n proces s i s a t bes t a techno-economically drive n enterprise, an d a t wors t a cynical ideologica l exer cise designe d t o legitimat e change s t o organizationa l an d wor k practice s tha t

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worsen employee s workin g condition s (Couchma n 1990) . I n contrast , a n alternative perspective ha s emerged referrin g frequentl y t o initiatives in Scandinavia, West German y an d sometime s Japan . Thi s mor e optimisti c versio n argue s tha t the declin e o f explicitl y "social" policie s ha s bee n accompanie d b y th e arriva l of a secon d industria l divide tha t provide s th e techno-economi c precondition s for a repoliticization and democratization o f technology policy , a new er a of human capital, and new forms of socially directed innovatio n (Elliott 1986; Mathews 1989a; Piore/Sabel 1984; Reich 1983). In either case by pointing to the importance of the promotion of technology for non-economic socia l ends and the limitations of "reactive " form s o f regulation , bot h perspective s deman d a reconsideratio n of th e Dualisti c Model o f technolog y polic y a s separat e area s of promotio n an d regulation.

3 Th e Dualistic Model o f Technology Polic y In th e classic term s characteristi c o f th e Dualisti c Model view , Professor Ernes t Braun stated i n 198 4 that The curren t interes t i n technolog y polic y arise s ou t o f a paradoxica l twi n concern : o n the on e han d th e wis h b y eac h natio n no t t o b e lef t behin d i n th e rac e fo r technology based prosperit y an d o n th e othe r han d multi-facete d fear s abou t undesirabl e socia l an d environmental consequences o f technology. The belief that better technology means higher economic efficienc y an d international competitive advantage is a strong driving force behind attempts b y mos t government s t o support, foste r an d accelerat e technologica l innovation. The fears abou t technology, on the other hand, force governments int o a range of regulatory activities (Braun 1984:123) .

This distinctio n i s philosophically based o n distinction s between fact s an d val ues, an d techno-economi c an d socia l issues . I n it s institutiona l form, differen t commentators fro m acros s th e politica l spectrum hav e mad e majo r distinctions between promotio n an d contro l institutions , stimulation and regulatio n institu tions, and accumulatio n and legitimatio n activities of the stat e (O'Conno r 1973 ; Johnston/Gummett 1979) . This distinctio n has, however , bee n undermine d by theoretica l development s and practice s withi n bot h th e 'promotion ' an d 'regulation ' areas . Fro m within the promotion area, innovatio n studies have simultaneously uncovered the socioeconomic processes involved in establishing alternative technological trajectories, regimes o r paradigms , an d reveale d th e "parado x o f automation" , i. e tha t a s automation succeed s i n takin g over a multiplicit y o f huma n tasks, i t increase s the significanc e o f thos e remainin g and establishe s th e basi s fo r ne w learnin g opportunities an d developments . I n combination , these insight s reveal bot h th e social construction of paths of technological development, and the importance of social an d organizationa l innovation s as constituent s of th e innovatio n process .

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Moreover, a s Piore and Säbel point out in their classic work The Second Industrial Divide (1984) , social change s o f this kind do not emerge solel y from the marke t or represent a simple social adaptatio n to the demands of technology. Models o f production , they poin t out, originate from withi n specifi c political and institutional constellations. They outline in particular the conditions affecting the Europea n craf t mode l an d th e Unite d State s mas s productio n model . A s i s now widely discussed, such models are diffused fro m one country to another, with each countr y adoptin g 'successful ' model s bu t adaptin g them t o their own spe cific circumstance s (Boyer 1989) . This proces s o f adaptation involve s changing customs and practices in a manne r tha t impose s different costs and benefit s on various groups. When new technologies a s significant a s microelectronics diffus e throughout the economy, an d organizational models aris e suc h as new Japanes e management methods, the adoptio n and modificatio n of these technique s in different production systems brings about a change in conditions of work and orga nization that have become accepte d a s a 'natural' part of economic lif e and even a key component of cultural identity. The resulting paths of socio-economic innovation are, consequently, inherently political and socially structured processes. As a result the "technical" promotio n of technology for "economic" ends is inevitably subject t o politica l shaping, however much 'technocrats ' o r wha t Professor Sel f has called "econocrats" attempt to support "the belief that there exist fundamental economic test s or yardsticks according t o which policy decisions can and should be made " (Sel f 1975:15) . Th e proble m tha t this inevitably creates i s ho w suc h political issues should be addressed, particularly within institutional organizations that have a self-understanding of their work as primarily technical or economic . From withi n the so-called regulatio n area, the study of the domination of tech nological developmen t by large scale systems ha s been a major factor leading to the explicit recognition of the "social shaping " of all technological artefacts and systems. Mos t o f th e traditiona l plethora o f regulator y institution s (monitoring committees, publi c inquiries, technology assessmen t bodies , etc. ) hav e foun d i t extremely difficult t o intervene effectively in the paths of development promote d by these systems, and have been restricted to a primarily "reactive" role. There has, consequently, been a n appeal fo r a more "proactive" or "constructive" approac h to technolog y assessment tha t attempts t o interven e earlie r on i n the innovation process - thu s attempting to 'promote' alternative paths of development. All such initiatives ar e grappling with wha t David Collingridg e ha s calle d "th e dilemm a of control" , i.e."attemptin g t o contro l a technolog y i s difficult , an d no t rarel y impossible, because durin g its early stages, when it can be controlled, not enough can b e know n about it s harmfu l socia l consequence s t o warran t controllin g its development; bu t by th e tim e thes e consequence s ar e apparent , contro l has be come costl y and slow" (Collingridge 1980:19) . If, more appropriately , the wor d 'shaping' i s substituted for 'control' , one o f the central dilemma s of al l socially oriented technology policy is revealed.

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A third area of technology polic y i n which the distinction between promotio n and regulatio n mechanism s ha s bee n broke n dow n i s i n th e spher e o f develop ment policy . I n this sphere, a greater concer n fo r the developmen t o f productiv e technologies 'appropriate ' fo r radicall y differen t culture s ha s le d t o a greate r awareness o f th e artificialit y o f th e Dua l Model . Thi s ha s not , however , bee n a dominant emphasis withi n economic polic y i n many developing countries. In the recent publicatio n On e World o r Several fro m th e Developmen t Centr e o f th e OECD, for example, Federic o Mayor commented tha t The recognition tha t expenditures on human resources development ar e not only necessar y in themselve s an d g o t o th e ver y hear t o f development , bu t tha t the y als o yiel d essentia l returns o f an economic nature , has not yet been full y incorporate d int o economic develop ment planning, nor into analyses of the allocation of increasingly scarce resources available to the social sector s (Mayor 1989:185) .

One attemp t t o develo p appropriat e concept s ha s bee n stimulate d by th e wor k of Steva n Dedije r a s witnesse d i n the collection From Research Policy t o Social Intelligence (Annersted t and Jamison 1988) . This attempts to provide a concept of "social intelligence" a s the organizational ability of a country to avoid mimicking overseas model s o f development and adapt t o a changing world by combining the effective acquisition , evaluation and use of information wit h planned policies an d activities for development .

4 Sociall y Oriented Innovation Polic y 4.1 Th e Limitations of Socio-economic Innovatio n Policies Despite thi s general breakdow n o f the Dualistic Model, i n the area of innovation policy th e clai m tha t huma n an d organizationa l consideration s shoul d b e incor porated a s a ke y facto r i n socio-economi c innovatio n is frequently treated wit h suspicion. Althoug h there i s an increasin g recognitio n o f th e nee d t o tak e suc h factors int o account , attempt s t o promot e thei r incorporatio n ar e ofte n see n b y business an d governmen t polic y maker s a s th e inappropriat e insertio n o f "soft " factors int o the "hard" processes of technical an d economic development . I n response, th e rhetoric of socio-economic innovatio n promoters strongl y emphasize s the economic necessit y o f the organizational changes the y advocate, ofte n down playing or actively denigrating the role of human or social consideration s as goals of th e proces s o f chang e (de n Hertog/Schöde r 1989) . Wher e greate r emphasi s is placed o n huma n skills, teamwork an d organizationa l decentralization , thi s is represented i n traditional 'socio-technicaP term s a s a fortunate overlap betwee n economic requirement s and social desirability . Unlike the 'socio-technical ' tradition, however, this view often involves a form of 'sof t technologica l determinism '

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as these change s ar e portrayed a s an inevitable requirement for the effective us e of new microelectronic based technologies . It thus becomes difficul t t o orient innovation policy towards a consideration of alternative socio-economic innovation trajectories, an d the stimulation of more 'humane ' path s of development. A second restrictio n on socio-economic innovation policy, as promoted b y science an d technolog y ministries , i s a tendenc y t o focu s o n traditiona l areas o f specialization. This is exemplified by the response t o the need for greater human skills, knowledge and intra-firm learning with policies for stimulating the number of R&D personnel. Thus an authoritative report on innovation policy by Rothwell and Dodgson , afte r arguin g tha t "Ther e exists stron g evidenc e to sho w tha t a n SMF's abilit y to access, transfe r and assimilat e external knowledg e depend s t o a larg e exten t o n it s leve l o f in-hous e technical expertise" emphasize s th e im portance of "a schem e to subsidize the costs o f hiring R&D personnel in SMFs" (Rothwell/Dodgson 1989:16) . Despite the importance of such schemes, it is crucial tha t the leve l of "in-house expertise " i s also taken to refer to developmental and reflexiv e processes of "learning by doing" on the part of system users. Thus, at a Japa n Institut e of Labou r conference , fo r example , a broade r approac h t o The Role o f Labor an d Management i n Technology Transfer i s adopted, definin g the "technology transfe r triangle" as a systemic interlinking of government, management and workers (Pock To o 1987) . This emphasi s is supported b y evidence of th e increasin g concer n o f managemen t not onl y wit h th e compute r skill s o f engineers but, centrally, with their human relations an d industria l relation s abilities (Williams 1988). A systematic consideration of such issues , however, takes innovation policy beyond the traditional province of many science and technology ministries. 4.2 Th e Nature o f Socially Oriented Innovation Policie s As th e ter m i s use d here , sociall y oriented innovatio n policies ar e intende d t o transcend bot h th e restriction s outline d above. O n th e on e han d the stimulation of socio-economi c innovatio n is no t understoo d purel y i n term s o f facilitatin g the establishmen t o f th e 'social ' condition s necessar y t o spee d u p technologi cal innovatio n and maximiz e economic profitability . I t is, rather, concerned wit h investigating the range of socio-technical innovation alternatives available for stimulating economic advance, and promoting paths of development in accordance with the production culture and social priorities of different countries. On the other hand this activity cannot, and shoul d not, be see n i n terms of the direct or indirec t promotion o f R& D fundin g an d personne l but , rather, a s a systemic approach to intra-firm and inter-firm innovation processes and governmental innovation policy. The for m i n which these intra-fir m an d inter-fir m innovatio n processes occu r will diffe r substantiall y between firms, industries and countries. As a result, there

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can be no simple prescription o f 'the' mode l o f humane paths of development o r appropriate polic y mechanisms . A s reveale d i n a numbe r of studie s of differen t production cultures, the development an d use of new technologies i s determined by th e "socia l constitution " (Hildebrand t 1989 ) o r "inherite d characteristics " (Child 1987 ) o f use r firms . Thes e ma y b e relate d t o thei r individua l history , the natur e o f th e industria l sector i n whic h the y ar e located , o r thei r position within a nationa l system o f skill s formatio n an d industria l conditions. In orde r to develop effective socio-economic innovatio n policies and orient these toward s social goals, these context s need to be given central priority. Moreover, countries clearly var y considerabl y i n th e natur e o f thei r scienc e an d technolog y syste m and relevant governmental structures. The for m take n b y systemic approaches t o socio-economic innovatio n will therefore differ i n accordance wit h the nature and degree of establishe d governmen t interventio n measures, th e metho d o f interes t group representation, an d negotiated forms of inter-departmental co-ordination.

4.3 Neo-Tayloris t and Skill-Based Manufacturing Trajectorie s Despite these qualifications about the context specific character of socio-technical innovation, there has been sufficien t research conducted on international variations in the introduction of new microelectronics-based technologie s in manufacturing to develop some genera l guidelines concerning the range and desirability of organizational options in this area. Due to the flexibl e an d integrated character of the new technologies, th e traditional conditions of both craft and mass producers ar e being changed. Fro m th e poin t of vie w of stimulatin g workers skill s and auton omy, however, th e form that this takes can var y between tw o extremes, variously described o n th e on e han d a s "neo-Taylorist" , "technocentric " or "neo-Fordist " regimes an d "skill-base d manufacturing" , "anthropocentric" o r "post-Fordist " regimes o n the other (Badham/Mathews 1989 ; Badham/Schalloc k 199la) . The neo-Taylorist tendenc y i s characterize d b y th e creatio n o f wor k system s that involve: - a broader rang e of employee tasks but the restriction of job enrichment opportunities or 'vertical ' skil l attainment; - a n increase i n skills an d training but a simultaneous growth in system moni toring and pacing of the workforce ; - th e tendency t o develop an d reward th e skill of key employees an d operators but a restriction o f this group to a minority of the workforce ; - th e attempt to motivate employee s responsibl e fo r costly an d interdependent equipment but the restriction of autonomous learning processes using the new information possibilitie s of new process technologies ; an d

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- th e training of worker s i n the new 'technical ' skill s require d t o operate th e equipment but a lack o f consideration t o the use and integratio n of traditional skills in the design of the new systems . In contrast, th e skill-based manufacturing tendenc y involves: - increasin g job enrichment as design and planning tasks are devolved to system operators; - a growth in the autonomy and responsibility of the workforce i n the exercise of local initiativ e and the developmental "learnin g b y doing" processes; - a reduction in the division of labour between "skilled" and "unskilled", an d an increase i n job rotatio n and team-based organizations ; - th e desig n o f ne w system software , architectur e an d organization i n orde r to facilitat e th e us e an d developmen t o f traditiona l skills and utiliz e syste m development capabilities . The degre e to which differen t firms , industrie s an d countries wil l b e abl e to , o r will attemp t to , approximate toward s on e or other en d of the spectrum will vary. Moreover, i t i s onl y to b e expecte d tha t i n the serie s o f negotiation s an d trade offs involve d in establishin g th e ne w productio n systems, n o singl e mode l wil l emerge o f 'the' desirable path of development. The challenge of socially oriented innovation policie s i s to adap t policie s t o thes e context s whil e formulating an d implementing criteria in a process of economic and socially oriente d intervention. Although this may be regarded a s a difficult task , it is important to recognize tha t the socia l structurin g of path s o f developmen t wil l inevitabl y happen, eve n i f this is carried ou t as a "practice without a name" while different interes t group s promote their view as "the" "efficient " an d "inevitable" form of socio-economi c innovation. Th e advantag e o f sociall y oriente d innovatio n policie s i s tha t the y make this social structuring explicit, and directly relate negotiations to competing visions of humane and desirable workin g conditions.

5 Sociall y Oriente d Innovatio n Policy Institutions At th e leve l o f industr y policy a wid e variet y o f scheme s hav e bee n suggeste d for integrating social, economic an d technology policie s in order to stimulate the process o f socio-economi c innovation . Influenced b y th e succes s o f innovative regional economies , Piore/Sabe l (1984) have recommended integratin g financial investment, trainin g and politica l initiative s in th e stimulatio n of collaborativ e regionally base d innovativ e economies. Thi s ha s stimulate d further widesprea d international interes t in regional firm networks and methods fo r their promotion. Drawing upon experiences i n Japan and Scandinavia, Robert Reic h (1983) place s central emphasis o n the larg e corporation a s the centr e of innovation , and advo -

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cates governmen t fundin g o f corporate socio-technica l innovatio n through integrating investment subsidies, job-retraining schemes , and social welfar e funding . For others emphasizin g the central rol e o f a democratic industr y policy, Scandinavian countries are often se t up as a model wit h initiatives extending from wor k environment an d codeterminatio n legislatio n t o nationall y coordinated busines s retraining scheme s an d th e us e o f pensio n fund s t o financ e tripartite investment decisions (Mathews 1989b) . At th e leve l of specific initiatives to stimulat e socio-economic innovatio n in a direction that explicitly incorporates socia l a s well as economic goals , a number of common general measure s have been developed or suggested b y proponents in different countries . In practice ther e are ofte n some difficulties i n distinguishing between mor e restricte d socio-economic initiative s from sociall y directed ones , as the public rhetoric o f many of the former include references t o "social goals " (see section 3.1) . However, some of the main policy mechanisms and institutional forms that could be used to stimulate socially oriented innovation are listed below.

5.1 Technolog y Transfer an d Diffusio n Mechanisms Many o f th e technolog y transfe r and diffusio n mechanism s develope d ove r th e last decade ma y be utilized to promote social objectives in the innovation process. The foundation of such moves can be the incorporation of social objectives in the charters o r missio n statement s o f thes e programme s o r institutions , composin g a Board structur e that incorporates a t least tripartit e representation an d ensuring that suitabl e personnel an d fund s ar e mad e available . Some o f th e ke y area s i n which such innovations can be made are : Government-Assisted Technical Consultancy and Training Institutions: Thes e institutions can assis t i n the selection, implementation and development o f skillbased manufacturin g systems . Activitie s may rang e fro m providin g assistance in th e developmen t o f appropriat e technolog y an d huma n resources strategie s to th e trainin g of syste m users . A ke y componen t o f suc h institution s coul d be th e operationa l definitio n an d applicatio n o f appropriat e syste m desig n an d implementation methods for the new systems. Government-Assisted Design an d Innovation Centres: Thes e centre s ma y b e responsible fo r software and system design to support skill-based manufacturin g systems. A ke y functio n o f thes e centre s shoul d als o b e th e marketin g of thes e systems, an d diffusin g knowledg e of their advantages into industry. University Research an d Consultancy Units: Th e substantia l resources o f th e higher education and universit y syste m can als o b e utilize d t o addres s th e sam e issues as the above two types of centres. This can be assisted b y the establishment of education-based centres fo r research an d consultanc y with simila r guidelines to the above .

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Industrial-Sector Restructuring Plans: Man y countries now hav e sectora l in dustrial plans to assist ailing traditional industries and promote the development of rising high-tech industries. This assistance ca n be administered by tripartite bodies, and involve the funding o f investment dependent upon firms involving unions in the establishment of business plan s and the design of new work practices. Government Procurement Policies and Offsets Arrangements: Governmen t purchasing practices ca n b e influentia l i n tw o ways : th e softwar e an d system s pur chased fo r us e i n publi c manufacturing enterprises ca n b e require d t o confor m to skill-based manufacturing design guidelines; and government institutions may require that firms from whic h the y bu y goods and materials move towards skillbased manufacturin g working practices. I n addition, where good s ar e purchase d from oversea s companie s a requiremen t ca n b e mad e fo r thes e firm s t o trans fer skill-base d manufacturin g an d knowledge t o collaborating firms in the hom e country. Investment Funds, Programmes and Corporations: Publicl y assisted investment funds ma y range fro m venture capital enterprises throug h development corporations to state regulated pension funds. These may be directed towards the fundin g of products or firms that enhance or are moving towards skill-based manufacturing processes, or be dependent upo n initiatives being made i n this direction.

5.2 Managemen t and the Development of Human Capital Incentives As revealed i n a number of international studies, managements i n different countries are influenced in their personnel policies by the structure of national systems of skill s formation . The effec t o f thes e system s can , however , b e strengthene d or weakened b y direct government actions . Initiative s to enhance th e importance attached b y management to upgrading the skills and responsibility of their workforce, and correspondingly their working conditions, include a variety of measures of which some are : - Apprenticeshi p training grants - Shor t term job training or retraining schemes - Nationall y coordinated trainin g funds financed by employer contribution - Employmen t insuranc e or other legislativ e measures t o discourage externa l labour market strategies towards the hiring and firing of employees .

5.3 Worker s Representatives and Concrete Codeterminatio n Support In the formulation of detailed skill-based manufacturing designs for specific firms, workers representatives pla y a crucial role in both determining the social criteria of central importance to the workforce and in ensuring the effective participatio n of employees i n system selection, implementatio n and development. Consequently,

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the tw o majo r argument s for providin g assistanc e t o worker s organization s and representatives are: firstly, the imbalance of resources betwee n capital and labour; and, secondly, the difficultie s tha t workers an d their representatives have in ade quately considerin g the implication s of ne w systems an d examining the choice s available. Some possibl e government initiatives are: Government Funding of Union Technology and Industrial Democracy Units: These can act as a source of information, training and advice for firm-based worker representatives, a s well as initiating projects in the definition an d implementation of skill based manufacturin g systems . Legislative Support for Information and Consultation Requirements in the Introduction o f New Technology: A range of measures may be involved here, bu t an important consideratio n i s the provisio n of arrangement s fo r worker s represen tatives to hire outside consultants, allocate sufficien t pai d time to considering or making innovatio n proposals, an d participat e i n union/public institution trainin g courses t o improve their knowledge and skills in the area o f innovation. Legislative Guidelines on Work Environment Conditions That Must Be Met in the Introduction of New Technology. A Requirement for Worker Involvement or Acceptance when Firms Review Government Assistance for R&D and Investment. 5.4 Nationall y Base d Skil l Formatio n Restructurin g The degree o f interest that individuals, firms and unions have in the upgrading of skills and employee responsibility reflects the national skill formation structures within whic h they ar e embedded . Man y o f th e initiative s outlined above hav e an influenc e o n thes e structures ; indeed, i n a sens e the y partiall y constitut e it. However, governmen t action s i n a t leas t thre e othe r area s hav e a n importan t influence an d ar e henc e o f crucia l significance in shapin g alternative path s o f socio-economic innovation . These three are public education systems, government collective bargaining institutions, and public sector enterprises . Public Education Systems: I n order to facilitate both horizontal and vertical upskilling of employees, new broader-based trainin g courses are required in addition to modular course structures that allow for retraining and upgrading. These course structures are part cause and part effect o f career path s and job structure s in industry, an d consequentl y require modification to support skill-base d manufacturin g development. Government Collective Bargaining Institutions: The nature and role of governments in the collective bargaining process clearly vary greatly between countries . However, thes e mechanism s can, wher e possible , b e utilize d t o ensur e tha t the successful resolutio n of conflicts over wage s an d workin g conditions are relate d to th e introductio n of a numbe r o f labou r marke t characteristic s tha t suppor t skill-based manufacturing . Som e o f th e mos t crucia l are : th e broadbandin g of

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job classifications , pay fo r knowledg e wag e systems , an d th e establishmen t of skill-based career paths. Public Sector Enterprises: Th e influenc e o f th e governmen t on publi c secto r enterprises ca n b e use d t o assis t th e developmen t o f skill-base d manufacturing processes by introducing the changes outlined above. The schemati c natur e of this list necessarily provide s only a general outline of possible socially oriented innovatio n policy measures. Any coherent and effective socially oriented innovatio n policy would require the considered development of an integrated packag e o f such measures. I n practice, however, technology policy programmes oriented towards social ends in the area of process innovation hav e predominantly take n the form of direct fundin g o f research an d development or company project s i n this area. A s illustrate d in Table 1 , there ha s bee n a proliferation of such government programmes t o stimulate socio-economic innovatio n in Europ e ove r th e las t tw o decades . Withi n thes e programme s on e stran d o f research and promotion has developed tha t is explicitly directed towards sociall y oriented innovatio n - thos e concerne d wit h the promotion of "human centred", "anthropocentric" or "skill-based" manufacturing systems. Despite the relatively small siz e of suc h projects an d programme s whe n compare d t o overall govern ment technology policy expenditures, their novelty and originality deserves som e further consideratio n a s an important set of initiatives to explicitly conduct a socially oriente d innovatio n policy. The purpos e o f the next section o f this chapter is therefore t o briefly outline the range of programmes involved, describe th e general characte r o f th e socio-technica l trajector y promote d b y thes e programmes , and discuss some of the problems and challenges that have faced these initiatives. As commente d above , a n effectiv e sociall y oriented innovatio n policy requires a fa r broader an d mor e extensiv e se t of initiatives . However, a s exercises in the use o f direc t promotio n mechanism s t o stimulat e sociall y oriente d innovation, the experience o f human centred project s an d programmes provid e an important insight into the difficulties an d dilemmas facing technolog y policy in this area.

6 Europea n Promotio n of Human Centred o r Anthropocentric Systems 6.1 Europea n Projects and Programmes Government promotion of human centred or anthropocentric systems was prominently represented b y a number of exemplary projects carried out in the early 1980s in Sweden, German y and the UK. In the UK, at the University of Manchester, an interdisciplinary project funded by the British research counci l SERC was undertaken by the world-renowned control engineer, Professor Howard Rosenbrock, to create a human-centred lathe which left the creative programming decisions in the

41

From Socio-economic to Socially Oriente d Innovatio n Polic y

Table 1: Europea n governmen t programme s promotin g technology, wor k and organization Government R& programmes

UK: Scienc e policy research unit , ESRC X funded programme s (PICT, Ne w Technologie s in the firm ) France: Ministr y o f S&T X interdisciplinary programme o f research o n technology, work , employment & way s of life (PIRTTEM) , people, wor k and technology programm e Netherlands: Dept. o f education & X science: Technology wor k & organization (TAO ) programme Sweden: Wor k fun d programme X (MDA, LOM, development) Norway: HABUT programm e Germany: Ministry fo r research & technology: work & technology (AuT) X manufacturing X technologies (PfT ) χ programme, Breme n work & tech (AuT) programme

D

Implemen- Greate tation & technolog diffusion orientatio

χ χ

r Greate r Contac y educatio n n an d organization orientation

t

R. Coomb s r University

Mancheste

National Centre fo r Scientific Researc h

X S&

T Ministry

XX

Institut

XB X

XX

XX X Projektt

Belgium: X Flemish Foundatio n for Tech Assessmen t (STV )

X STV

EC: FAS T 11 : χ ESPRIT, BRIT E X programmes

XX

HABU

. Shepherd Nyman , W.E. Fund

T BMFT Au T (P. Oehlke) Projekttr ge r T Pf T . Martin ) r ge r G. Simonis, AuT Institut, Gelsenkirchen, Prof. F. Rauner, Bremen Univ .

BMF Χ (Τ

X ESPRI

Dr. Hertog MERI T e Maasstricht, also TNO Institut e & Erasmus University

W

. Wobbe, FAST 1 1 T CI M Human Aspects Advisory Group (P. Kidd)

X: Represent s relative emphasis compared t o other programmes; they do not represent an exclusive concentration. Where absent , there is no comparatively dominant specialization. x: Represent s less significan t emphasis. X an d χ are intende d a s rough guide s only.

Source: Adapte d fro m de n Hertog/Sc h de r (1989)

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hands of the operator, with the computer performing repetitive and routine func tions. In Sweden, fro m within the Centre fo r Working Life, a computer scientis t with sociologica l training , Pelle Ehn, coordinated th e UTOPIA computer-base d page se t up project, partiall y funded b y the Work Environment Fund. The ai m of the project was to develop a system, in collaboration wit h print workers, that aided rather than undermined traditional craft printing skills. In Germany, an enginee r working within the Manufacturing Technologies programm e o f the German Re search and Technology Ministry , Peter Brödner, emerged a s the leading exponent of a collaborativ e projec t t o establis h worksho p oriente d programmin g (WOP ) systems fo r decentralize d craft-base d machin e programming, an d decentralize d production islands fo r computer assiste d multi-skille d grou p wor k with both di rect and indirect production activities carried out by craftspeople on the shopfloo r (Brödner 1987 , 1989 , 1990) . Althoug h these three projects i n particular were de liberately organize d an d influential a s exemplary models , the y do of course only represent a few of the multiplicity of initiatives that were carried ou t during these years, especiall y i n Germany and Scandinavia . These projects wer e the product of, and source of further inspiration for, a fairly extensive "humanization o f wor k constituency " (Badham/Naschold , i n this volume). This constituency is oriented to the redesign of the technological and social components o f modern production systems to improve both production efficienc y and the skill, responsibility and autonomy of the workforce. They are the product of a number of different developments but, in particular, they owe their intellectual origins t o fou r mai n influences: firstly, the theoretica l wor k an d practices o f th e Tavistock Institut e ("socio-technical theory" ) an d th e Luca s Aerospace/Greate r London Enterpris e Boar d activitie s ("socially usefu l production") ; secondly, th e post-war critique of the "inhumane" natur e of automation emerging from control engineering and computer science 1; thirdly, the movemen t fo r "alternative tech nology" and "socially responsible " growth that gathered momentu m in the 1970 s and found wider cultural acceptance an d institutional embodiments in the 1980s 2; and, fourthly, the quality of working life or humanization of work movement that became increasingl y popular throughout the 1970s . It was , however , th e nationa l traditions o f wor k refor m an d nationa l government programmes that provided the major direction and stimulation to the different projects. I n the UK, the network of local enterprises fostere d an d co-ordinated b y the Greate r Londo n Enterpris e Boar d di d much to promote th e idea s o f sociall y useful productio n associate d wit h th e promotio n o f huma n centred technolog y concepts developed b y Mik e Cooley whil e participating in the formatio n of th e shop steward s pla n at Lucas Aerospac e (Coole y 1984) . I n West Germany , ther e have been a number of attempts to define and implement features of 'anthropocen tric' productio n island s i n a n industria l relations contex t tha t include s a stron g trade union structure, extensive legal support for workers rights, co-determination legislation an d statutor y consultation wit h works councils. Two of the ke y influ ences hav e bee n th e programme s funde d b y th e Federa l Ministr y of Researc h

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and Technolog y i n th e area s o f manufacturin g technologie s (Fertigungstechnik) and th e humanizatio n of wor k (no w wor k and technology) . Th e 'Humanization of Work ' programm e wa s establishe d i n 197 4 an d b y 198 1 i t ha d spen t D M 400 millio n an d budge t plan s wer e se t to ru n a t 10 0 million D M annually . The Manufacturing Technologie s programm e wa s les s directl y oriented t o wor k hu manization and subject to less formal trade unio n influence. However, i t played a key role i n the development of programming technologies an d production island concepts tha t came t o exert a strong influenc e o n human centred ideas . Of major significance hav e als o bee n th e programme s establishe d b y th e Nort h Rhine Westphalian government (Socially Oriented Technology Design) and the Bremen government (Wor k an d Technology) . I n Nort h Rhine-Westphalia , the activities of th e Institut e of Wor k an d Technology , linke d to a specia l researc h grou p o n production islands at the Universit y of Bochum, are playing an increasing role in the further developmen t of anthropocentric concepts. In Scandinavia , sociotechnica l idea s fro m th e U K wer e develope d i n Nor wegian industria l democracy experiment s fro m the mid-1960s (Thorsrud/Emery 1970; Eide n 1979) . I n addition , a developmen t agreemen t betwee n th e Norwe gian employe r an d unio n organizations, the NA F (Norwegia n Employer s Con federation) an d the LO (Norwegia n Confederatio n o f Trade Unions) , allocated 5 million Crowns (US $ 700,000) annually for research an d education programme s on th e wor k organizatio n and industria l democrac y feature s of ne w technology . However, sinc e the establishmen t of th e Swedis h Wor k Environmen t Fund (Arbetsmiljofonden) i n 197 2 (which allocates over US $ 40 millio n annually, funded by a tax on employers), Swedish project s hav e come to play a dominant role. Of particular significance for human centred systems design, have been the Development Programme fo r New Technology an d Work Organization (1982-1987 US$ 8 million), and th e Programme fo r Man-Computer Interactio n (a joint programm e with the Swedish National Board for Technical Development) (1987-1992 US$ 1 0 million). The former programme wa s established "to investigat e the possibilities of developing job conten t and work organisation, as well as high productivity and competitive capacity , i n conjunctio n with th e introductio n of ne w technology " (Oscarsson e t al . 1988 ) an d bot h advis e an d disseminat e th e informatio n from the 2 4 projects . Th e latte r programm e i s aime d "t o promot e th e developmen t of compute r technolog y a t wor k adapte d t o huma n need s an d requirement s by a systemati c build-up of interdisciplinar y knowledge. Thi s i s to b e achieve d b y stimulating an d supportin g collaboration between research an d development i n technology an d work environment research" (MD A 1990:3) . In addition , the Work Environmen t Fund provided fund s fo r the Swedish Cen tre fo r Workin g Lif e (Arbetslivscentrum) whic h wa s establishe d i n 197 7 a s a n independent tripartite body. Government legislatio n of codetermination and par ticipation, provide s th e guidelines for the researc h activitie s of th e centre which are directed b y employer/union agreement. Par t of the research philosoph y of the centre i s tha t i n orde r t o hav e a significan t impac t o n ne w technology , unions

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have t o presen t workabl e modification s and alternativ e designs. Th e emphasi s is on loca l trad e unionist s working in collaboration wit h researchers (engineers , computer specialists , linguist s an d socia l scientists) . The centre wa s directly involved i n the UTOPI A project' s activitie s to involv e graphic workers , compute r and social researchers workin g together to propose modifications to the design of new newspaper tex t and image technology . In the second hal f of the 1980s , the activities undertaken in the different national projects hav e bee n formall y writte n u p an d diffuse d i n Englis h i n th e for m o f books b y Brödner , Eh n an d Rosenbrock . A t th e sam e tim e th e huma n centre d activities have become mor e influential at the European level . This has been mos t prominent in the European Commission ESPRIT project s 53 4 and 1199 , with the latter in particular combining representatives fro m th e UK, Scandinavia and West Germany. Curren t project s o f significanc e includ e ESPRI T 560 3 an d BRITE EURAM 3302 . Th e Europea n Commissio n FAS T programm e ha s als o take n up thes e idea s an d encourage d thei r diffusio n throug h the exertio n o f influenc e on Europea n technolog y programme s suc h a s ESPRI T an d BRITE-EURAM , the establishmen t o f a newslette r (AT&S) , collaborativ e researc h project s o n national condition s favourabl e t o anthropocentri c systems , th e creatio n o f a n 'institute withou t walls' t o assist Europea n interaction , and a series o f seminar s and working papers in the area of human centred o r anthropocentric technologies . This coordinatin g activit y is strongl y assisted b y th e wor k o f th e IFA C Socia l Effects o f Automatio n Committee wit h it s triennia l conference s o n Skil l Base d Automation and workshops in IFAC conferences, the establishment of a MODE M network linking national programme administrator s in the technology, work and organization area, and the work of the SEAKE Centre in the UK in the publication of the journal Artificial Intelligence an d Society an d the Springer-Verlag Artificial Intelligence an d Society boo k series . This furthe r developmen t i n the latte r hal f o f the 1980 s has bee n strongl y in fluenced b y thre e additional factors: firstly , th e apparent developmen t withi n th e computer an d proces s contro l industrie s of bot h th e capacit y fo r decentralize d production solution s and a greater degre e o f attentio n to "user-oriented " desig n practices; secondly , widespread debat e an d substantial agreement o n the need fo r "new productio n concepts " o r "broader " "comprehensive innovatio n concepts" to mee t th e "Japanes e Challenge " an d addres s th e failure s o f th e "automated " "unmanned" "compute r integrated " factor y o f the future; and , thirdly, the close r integration o f th e Europea n Community , and debat e ove r th e meanin g of socia l citizenship an d technolog y polic y fo r th e "ne w Europe" . A n influentia l par t o f these development s i n Europ e ha s bee n th e debate s surroundin g the Europea n ESPRIT CIM-OS A projec t t o creat e a new se t of technical/organizational stan dards for future system s development for the computer integrated manufacturing (CIM) "factor y o f th e future" , th e rol e o f th e FAS T programm e i n promotin g a sociall y oriente d vie w o f technolog y polic y tha t deliberatel y facilitate s th e integration o f researc h network s aroun d the desig n an d implementatio n of "an -

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thropocentric" production systems, an d the rise and development of government programmes, research practitioners and consultancy firms oriented towards implementing "comprehensive innovatio n concepts" (Badharn/Naschold, in this book) . 6.2 Th e Socio-technical Trajectory Define d In combinatio n these development s hav e resulted i n the creatio n o f a Europea n community o f projects , programmes , institution s and network s tha t hav e a sub stantial interes t i n th e promotio n o f huma n centred o r anthropocentri c systems . The majo r activities and influence s upo n this community are schematicall y outlined in Figure 1 . Any discussion of the general approac h adopted mus t be awar e of the clear influence that different nationa l contexts have had on the development of variou s projects an d programmes . A s socio-technica l theor y wa s differentl y emphasized i n differen t countrie s suc h a s th e U K (liberal-pragmatic) , Scandi navia (worke r democracy) , th e US A (huma n relations) , an d th e Netherland s (comprehensive-strategic goa l oriented ) (de n Hertog/Schöde r 1989 ; Eh n 1988 ) so the different huma n centred activitie s have received a different emphasis . This has involved, for example, a stress withi n Germany on production islands, within Scandinavia o n democrati c participator y design, an d th e U K o n tw o theme s o f human/machine interface and socially usefu l production . Despite this divergence of national emphasis, however, certain common themes of a general approach can be observed . A key focu s is the direct promotion o f new exemplary model s and techniques of system design t o enhance job enrichmen t and worker autonomy. Through the use of such dichotomies a s "technocentric" and "anthropocentric" approache s t o new manufacturin g systems, thi s approach continue s and develops upo n the tra ditional socio-technical an d organization theory contrast s betwee n "mechanical" and "organic " systems , "low-trust " an d "high-trust " cultures , "Theor y X " an d "Theory Y " management philosophies , etc . I n this sens e ther e ar e a numbe r of similarities with the image of the skill-based socio-technical "integrated factory " provided b y socio-technical writers in the United States. Accordin g to this view, the contemporar y introductio n of flexibl e an d integrate d technologie s i n a n in creasingly uncertai n manufacturing environmen t results i n a general increas e i n the need fo r worker's skills , responsibility and teamwork . The huma n centre d mode l i s i n thre e way s als o a partia l rejectio n o r im portant developmen t upo n thi s traditiona l approach . Firstly , i t emphasize s th e socially shaped, negotiate d an d influentia l characte r o f technological systems. I t is stressed tha t job designer s tha t fai l t o actively intervene in th e initia l shapin g of technological system s are , i n a sense, "rearranging deckchair s o n the Titanic " (Rosenbrock 1990) . Ke y decisions about wor k ar e buil t int o technological sys tems, and given traditional Taylorist management philosophies and technocentri c views of human operators a s sources o f "error" in automated systems, the poten-

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Richard Badha m

1960s to 1970s

Socio-lechnical, qualit y o f working lif e an d industria l democracy movement s

Critique o f inhuma n systems development by computer scientists and control engineers, e.g. Wiener , Wei/,cnbau m

Alternative technology, environmental and costs-of-growth movements

1970s

FRO humanization ot wor k and technology programme s and institutions , e.g. BMF T HdA, PIT programmes . IHAA, IA O institute s

Scandinavian wor k environment and industrial democrac y programmes an d institutions , e.g. Arbctsmiljofonden , Norwegian Industria l Democ racy Programm e

UK radica l and regional miti a lives, e.g. Luca s Aerospac e Plan, Greater Londo n Enter prise Boar d

Key national projects 1980s

FRG Work-Oriente d Pro gramming (WOP) and pro duction island projects (ke y figure: Brödner)

Utopia craft-oriente d com puter-based newspaper lay out software (ke y figure : Ehn)

UMIST human-centred lathe projec t (key figure : Rosenbrock)

Key European project s Late 1980s

Some associated technologies and institution s

Late 1980s

Contemporary tech nologies, e.g. FR G (WOP N C programmes, LP S Bochum DISCOS S and COSCOSS island planning systems) ; ESPRIT human-cen tred CIM result s (BICC Huma n Centred Systems Ltd.) ; Production Planning CAD Sketchpad, Scandinavia (Utopia page set-up )

Contemporary instit u lions, e.g. FR G (Arbeit un d Technik. Gclsenkirchen; IHAA, Berlin ; 1AO , Frankfurl/Main); U K (Human Centre d Sy s terns, London; Seak e Centre, Brighlon: HUSAT, Loughbor ough); Scandinavia (Arbelsmiljöfondcn, Stockholm. Sweden ; DTI, Taaslrup, Den mark; IRM . Trondheim, Norway)

Figure I : Schemati c outline o f human centred system design developments

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tial of modern technolog y t o facilitate enriched grou p work may be prevented. In Shoshana Zuboff's terms , systems will have "automatic" function s built into them and "informating" capabilities built out (Zuboff 1988) . The human centred capa bilities of new systems are thus a potential to be realized i n truly interdisciplinary (Kidd 1990b ) syste m design , no t a consequenc e o f fortuitou s development s in information technolog y an d marke t conditions . The developmen t o f th e human centred CI M philosoph y an d th e creatio n o f exemplar y models , practica l de sign criteri a and techniques , is consequently see n t o be o f crucial importance in influencing manufacturin g technology paradigms . As Howar d Rosenbrock com mented, while "there is a strong tradition in the social scienc e o f 'socio-technica l design', i n whic h th e technolog y an d condition s of wor k ar e bot h studie d to gether i n th e desig n stage" , thi s i s usuall y onl y relate d t o "smal l change s a t the fringe s o f technology" . I n contrast , huma n centre d project s ca n b e see n a s attempting t o appl y socio-technica l desig n principle s at a deep leve l i n technologySecondly, thi s approach i s explicitly oriented t o nation s with highe r level s of skills, established trade union structures, competitive advantages in higher-quality and more customize d manufacturin g products , an d cultures and political systems based o n individualis m and democracy . These conditions, it is emphasized, pro vide real resources that can be deployed i n the shaping of new production systems in a manner that builds upon and develops rathe r than undermines human skills. It i s no t assumed , therefore , tha t ever y industr y in ever y countr y wil l (o r can ) follow th e same route but rather that the above economic an d political conditions broaden the range of options for some firms and nations. Those countrie s with, for example, higher trust production cultures and producing for more quality-oriented customized markets, wil l have substantial advantages (Sorge/Streeck 1988) . The promotion of "human centred" approaches i s explicitly based on this assumption, especially b y the European Commissio n Forecasting an d Assessment o f Scienc e and Technology (FAST ) programm e an d European Strategi c Programm e o n Research i n Information Technology (ESPRIT ) (Warne r et al. 1990) . The objectiv e is therefor e th e desig n an d implementatio n o f competitiv e strategie s an d sup portive technological and organizationa l structures that will adap t to, rather than undermine, these advantages . Thirdly, as a corollary to the first two points, it is recognized tha t there are substantial constraints upon the development of the "human centred" path . Not only are the traditional Tayloristic management strategies an d departmental structure s highly resistan t t o chang e bu t th e 'ne w productio n concepts ' tha t ar e emergin g pose potential dangers for human skills and the quality of working life. Under the umbrella of "flexibility " and "integration" , ne w form s of work organizatio n may be implemente d tha t result in jobs that ar e increasingl y stressful, and wor k pro cesses (an d workers ) tha t are mor e rathe r tha n less monitore d an d controlled by central planning departments an d uppe r leve l management. For the mor e radical advocates o f "wor k oriented " o r "labour oriented " system s design, thi s require s

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making sharp distinction s between restricte d "socio-technical " perspectives an d more radica l "collectiv e resource" approache s (Eh n 1988) . Wha t i s commonl y agreed i s that one of the key challenges facing "human centred" CI M approache s is drawing upon existing technological, economic an d political resources to create techno-organizational systems that avoid these dangers . The desig n idea l o f huma n centred approache s i s generall y characterize d i n opposition t o "Taylorist" or "traditional engineering'V'technocratic " approache s that (i) identify efficienc y wit h the maximum extraction, codification and automation o f al l productio n knowledge an d skill s and (ii ) view th e remainin g human activities withi n engineering system s as sources of "error" or "disturbance" . In opposition t o this view, a design idea l i s upheld that seeks t o "subordinate" ma chines t o huma n rather tha n vic e versa , buil d upon an d enhanc e existin g skills and abilities , and plac e huma n purposiveness a t the centr e o f syste m operation s (Rosenbrock 1990) . In elaboratin g thi s general orientation , the "computer a s craf t tool " metapho r is used a s an important design objective . This orientatio n is clearly expressed i n the imperativ e "to desig n an d use computer artifact s base d o n the practical skill of craftsmen, rathe r tha n just the calculus of engineers" (Eh n 1988:371 ) an d assertions that "The perspectiv e i n system design has to be shifted from developin g computer programme s imitatin g and replacing human expertise toward s design ing computers a s a useful too l fo r human experts. Thus , not the computer but the computer aide d craftsman might emerge a s the new hero of production (Brödner 1989:45). The importanc e of these desig n ideal s is not their originality, for such debates wer e widespread in discussions of the tool/machine question in the nineteenth century . They posses s a differen t twofol d significance : firstly, that they are no w being operationalize d i n the desig n o f ne w computer base d productio n technologies, an d secondl y tha t they ar e intervenin g at a specifi c technological conjuncture i n the development o f CIM. The operationalization of these concepts involve s an emphasis o n three design imperatives fo r human centred systems . Firstly , the statu s and operations o f th e system mus t be as far as possible mad e "transparent " t o the user , i.e. dat a base s are accessibl e t o users , syste m statu s informatio n i s available , informatio n i s organized an d presented i n a manner that is compatible with traditional forms of knowledge an d wor k practices , etc . Secondly , th e user s o f system s mus t be th e main sources o f "judgement", i.e . actions are at the user's discretio n (eve n wher e these ar e supported , assesse d an d evaluate d wit h the assistanc e o f computers) , machines are controlled b y those most directly and immediately involved in their use, the choice between allocatin g functions to machines or humans is made by the users, etc. Thirdly, the maximum degree o f "autonomy" mus t be given to users in controlling their own wor k an d fulfillin g th e indirec t support function s required for thei r tasks , i.e . maintenance , syste m selectio n an d development , personne l recruitment, scheduling , incremental process improvement , etc. Huma n centre d systems shoul d therefor e (i ) accep t th e presen t skil l o f th e use r an d allo w i t t o

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develop, rathe r tha n incorporatin g thi s skil l int o the machine , an d subsequentl y de-skilling th e human ; (ii) allow a greater degre e o f freedom fo r user s to shap e their ow n workin g behaviou r an d objectives , thereb y increasin g th e exten t t o which th e huma n control s th e technolog y rathe r tha n vic e versa ; an d (iii ) unite the planning, execution and monitoring components o f work, thereby challenging established division s of labour (Corbett e t al. 1991) . These principles have been explicitl y embodied i n the design of NC Worksho p Oriented Programmin g (WOP) softwar e in Germany, MDI NC lathe software developed at UMIST Manchester, an d the computer aided desig n (CAD ) sketchpad developed in ESPRIT project 1217(1199) . If we focus on one example, th e WOP system was developed usin g research showing that there are economic advantages in allowing skilled workers to develop programmes, ye t the experience and knowledge of these worker s i s at odds wit h traditional abstract programmin g method s and editing devices. Th e WO P syste m provide s a unifie d use r interfac e for ne w shop-floor programmin g method s suite d for turning, milling, grinding and shee t metal cutting. The software allow s the workers to draw upon their manufacturing knowledge, planning capabilities and situational knowledge. In contrast t o earlier NC programmes, i t is up to the worker to plan the programme's flo w an d decid e on technologica l data . Th e syste m keep s recurrin g geometri c element s and cutting cycle s i n a generalize d pre-programme d form , an d th e worke r use s his/he r initiative i n combining these module s and settin g parameters. Furthe r assistance is give n by a tool data base and graphi c real-time simulation of too l movement s in a user interface that emphasizes the graphic (rather than abstract and symbolic) representation o f object s an d operations . Th e "user-friendliness " o f th e syste m is evidenced b y th e fact that workers ca n us e the syste m unaide d after a quarter of a n hour, and tha t operators wit h no programming experienc e perform , afte r a five-day learning phase, a s well as their experienced colleague s di d at the beginning (Brödner 1989) . In the case of the UMIST software , further developed i n the ESPRIT 121 7 graphic interactive CNC lath e project, an added advantag e is that it can be turned off and left asid e in order for the operator t o work in a conventional way i f this is appropriate (Gottschalc h 1989) . As observed by Professor Rosenbrock , head of the UMIST project, this research appears a t an important technological conjuncture. In the development of numerically controlle d technology , shopfloor/manufacturin g manua l data inpu t (MDI) systems an d integrate d compute r aide d desig n an d manufactur e (CAD/CAM ) systems offe r ver y differen t technologica l vision s for th e us e an d developmen t of compute r base d manufacturin g technology. Development s i n microelectron ics and computer hardware, accompanie d b y proven downtime and other costs of highly integrated systems, have created a techno-economic opportunit y for retaining and developing traditional manufacturing skills and traditions. In this context, the importance o f human centred syste m development s is that they ar e designe d to revea l an d promot e th e economi c effectivenes s o f th e MD I option , thereb y enabling th e retentio n an d computer-assiste d developmen t o f mor e traditional

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workshop-oriented productio n skills . Unlike Noble (1984) , who emphasizes the defeat o f "record playback" automatio n models a s a result of a capitalist control imperative, Rosenbrock stresse s the importance of focussing on the particular use and developmen t o f NC and the transcendenc e o f traditional engineering design prejudices. It is this connection wit h these broader issue s that has led the human centred approac h t o a compute r a s craf t too l idea l tha t extend s beyon d th e de sign o f user-friendl y software t o assis t sho p floo r operators . A s on e proponen t of huma n centred desig n commented , "huma n centre d i s no t user-friendl y writ large". The "tool " idea l ha s thre e othe r characteristic s tha t suppor t thi s difference. Firstly, th e us e o f computer s a s tool s supportin g huma n judgement require s a deeper consideration o f the allocation of functions betwee n human s and systems than the design o f easy-to-learn-and-use "interfaces" fo r a pre-given distribution of functions. Three essential characteristics ar e (i) system architectures t o support decentralized desig n an d productio n competencies ; (ii ) hybrid automation tha t ensures the appropriate allocatio n of functions between system s and operators at every leve l to enabl e an d encourag e th e exercis e of human judgement; an d (iii) user/system interfaces tha t suppor t rathe r tha n undermin e production skills and tacit knowledge an d enhanc e th e "tool" like character o f new systems . The current BRITE EURAM 3302 project is exploring this issue further, emphasizing the degree to which anthropocentric ideals requir e even mor e radica l approache s t o system design, involving furthe r extendin g the understanding of anthropocentric systems from criteria of "what the system does" to "how the system operates". This is, in a sense, a far deeper level of 'transparency ' than the design of user-friendly interfaces to support traditional craft skills, it involves not how the system appears at different levels but how it functions overall. It cannot, for example, involv e the use of complex APT programming languages at one level and workshop-oriented programming (WOP) language s at another (Kid d 1990a) . Secondly, in traditional craft production , productio n design emerge d fro m a profoun d understanding of manufacturing tool s an d practices an d involved a strong commitment to produc tion qualit y an d excellence . A s a result, the compute r a s craft tool idea l orient s systems design s toward s mor e quality-oriente d product market s an d th e manufacturing oriente d MD I rather than design-oriented CAD/CAM options . Thirdly, craft tools were traditionally designed, maintained and purchased by craftspeople , and knowledg e abou t th e us e o f these tool s occurred throug h master/apprentic e experience base d learning. This design ideal focusses o n the broad range of tasks and activitie s fulfille d b y craftspeople and , in the context of contemporary man ufacturing, facilitate s greater attention to group work and the decentralization of these varied 'indirect ' responsibilities to the craft group. This ideal has been mos t developed i n huma n centred o r anthropocentri c project s t o desig n an d suppor t Fertigungsinseln o r production islands. Since the establishmen t by th e Researc h an d Technology Ministr y of it s pro duction islan d projec t i n 1980 , ther e hav e bee n fou r majo r conference s hel d

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by th e AW F Associatio n i n Eschborn , mos t recentl y i n 1990 , elaboratin g th e principles an d case stud y experiences o f productio n islands . These proceeding s represent th e mos t extensiv e coverag e o f productio n islan d experiments . Som e of the most significant project s ar e those established a t Sulzer-Weise (Bruchsal), Feiten & Guilleaume (Nordenham), and Kodak (Berlin), as well as others carried out by such firms as MAN Roland , Heidelberger Druck , Mercedes Benz, Kraus s Maffei, Mannesma n Demag and others . Th e institute s involved and the project s upon whic h they have worked hav e been fostere d b y a number of governmental programmes. Amongs t the mos t significan t ar e two programmes o f the Germa n Federal Ministr y for Researc h an d Technolog y (BMFT) : th e Ne w Manufacturing Technologie s Programm e an d th e Humanizatio n of Wor k (no w 'Wor k an d Technology') Programme ; an d stat e governmen t ( L nder) programme s suc h a s the North Rhine-Westphalia n 'Ma n an d Technology: Sociall y Oriented Techno logical Development ' (SOTECH ) Programm e an d th e Breme n cit y stat e 'Wor k and Technology' Programme ; an d other governmen t research funds , suc h as the 5-10 year specia l researc h gran t funding th e establishment o f the multi-institut e Production Islan d Research Centr e a t the Rhein-Ruh r University, Bochum. As a result of this degree of support, the concept an d reality of production islands has become a key feature of models of human centred CIM. The experiences and discussions about German projects have had a considerable effect o n human centred CIM designs throughout Europe, represented at the European level for example in the semi-autonomou s production islands produce d b y ESPRIT projects 53 4 and 1217. Following fro m th e technologica l research , fo r example , ther e ar e presently a wid e variety of Germa n compute r base d productio n plannin g systems t o sup port production islands, in addition to the WOP programming software describe d above. These systems operate at various levels from strategi c production planning (PPS/MRP systems and mainframe support), to medium-range co-ordinating planning (Sho p Floo r Contro l SF C system s an d workstation/PC support) , an d shor t term loca l plannin g (Local Are a Cel l Controller s an d P C support) . Firstly , operators task s are widene d as far as possible. Secondly , computer aided planning facilities ar e located at shop-floor rather than planning-department level. Thirdly, as far as possible plannin g and schedulin g functions ar e supported a t production island rather than foreman/area control level. Some of the German system s that fulfi l thes e function s include the ΑΗΡ Leitstand DO S system ; INFOR CI M Leitstand DOS system; FI2 UNIX system; and Inteps, LPS DOS system. More recently, the capacities of the LPS system, developed a s a production planning aid to production islands, has been supplemente d through th e developmen t o f a COCOSS syste m fo r plannin g and co-ordinating production islands. The University of Bremen partners in the ESPRIT 1217 project have produce d a n IKARU S programme tha t is no t ye t commerciall y available. From the same ESPRIT project, Appropriate Computer Integrated Manufacturin g Technology (ACiT ) PC base d softwar e i s now sold b y Huma n Centred System s

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Ltd. (BICC) in the UK for scheduling both within and between productio n islands. In on e BRIT E projec t co-ordinate d b y th e Fraunhofe r IP K i n Germany , furthe r additional support fo r decentralization has been provide d through the creation o f a knowledge-base d shopfloo r contro l syste m t o assis t grou p leader s o r foreme n in makin g complex productio n decisions (Schalloc k 1989) . From on e poin t o f vie w thes e initiative s could appropriatel y enoug h b e see n as a furthe r extensio n o f job desig n an d wor k humanizatio n activitie s t o tak e into greater account th e technical component s o f socio-technical systems . Fro m another poin t o f view , however , the y ca n als o b e perceive d a s th e activitie s of a growin g 'technologica l constituency ' attemptin g t o interven e significantl y i n the developmen t o f a technologica l trajector y tha t ha s no t ye t culminate d i n working systems an d commercial products : the path towards computer integrate d manufacturing (CIM) . A s such , they represen t a n importan t set o f initiative s in a new type o f technology polic y - th e direct interventio n by government i n the early introduction of social orientations (other than health and safety regulations) into the design an d development o f new forms of process technology. As is comprehensively documented , the new technologies i n design, manufacture and planning that go to make up CIM as yet affect onl y a very small minority of jobs, documented a s 7.1% usin g programmable equipmen t in West German y in 198 8 (Ebel 1990:22-25) . Moreover, th e diffusion o f the new CIM technologie s in their more 'hi-tech ' an d 'global ' form s o f corporate integration i s remarkably limited. Thi s i s apparen t eve n withi n such sophisticate d producer s a s th e Wes t German machin e tool industry (Schultz-Wild 1990) . This mean s that we are faced with a dynamic and changin g situation no t a fixe d 'mature ' technolog y wit h established an d rigi d operatio n procedures . Th e debate s ove r CI M are , therefore , to a great extent , a discussion ove r wha t images o r models shoul d be adopted a s a guid e to the desig n an d implementatio n of CIM. Moreover , radicall y differen t models aboun d o f how best t o use the new technologies, an d serious discussions are carried ou t into the effectiveness of "Fordist", "Toyotist", "Volvoist" an d even "Sonyist" model s o f production . Thi s i s accompanie d b y a n equa l diversit y in the technical standard s governin g CI M technologies. No t only wil l th e technical components o f CIM i n design, productio n an d plannin g often no t spea k t o eac h other, there i s no consensus about wh o should b e speaking t o whom an d what they should b e saying. Integratio n standards ar e not well developed an d are stil l a matte r o f inter-corporat e an d inter-nationa l rivalry , th e conflict s surrounding MAP, TOP and CIM-OSA standards are only some o f those involved . The information requirements of highly integrated and formalist technical systems ar e also extremely complex t o define and even more difficul t t o fulfil. Softwar e unreliability, data inconsistenc y an d limited control senso r abilit y all contribute to syste m vulnerability and breakdown. Al l that can comfortably be said is that CIM need s to be custom-built by an d fo r specifi c enterprises, an d tha t littl e is known abou t how this is to be most effectively achieved .

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In thi s context, huma n centred o r anthropocentric design activitie s can best be seen a s the work of a growing 'technological constituency' proposing a particular model of CIM capable of addressing defined technological problems. Where, a s is now commonly accepted, experiences wit h CIM implementation reveal low levels of productivity improvement, this 'critical problem' ca n b e perceived differentl y as, for example, the result of inadequate levels of technological development an d coordination, the fault of inadequate implementation processes, or design failures in a technocentric attempt to remove huma n skills from productio n systems. Th e solution to such "reverse salients", a s they are described i n history of technology research, can , consequently , be differentl y defined . I n suc h situations , there ar e always wha t innovation researchers have called "socio-technica l constituencies " promoting differen t form s o f hardware , software , syste m architectur e and orga nizational design as solutions (Molina 1989) . These constituencies include R&D laboratories, corporat e equipment vendors, engineerin g research an d consultancy institutes, universit y research department s an d applie d consultanc y centres, hu man factors and engineering associations, nationa l and international standards and regulatory bodies , governmen t innovatio n programmes, corporat e syste m user s and use r groups , employe e representative s an d trad e unio n associations , educa tional an d trainin g bodies an d industria l regulation institution s etc . Moreover , there is substantial evidence t o suggest that, in most cases, the activities of thes e constituencies are often carried out without a clear overview of the overall context of system development , and wit h mistake n views of the ultimat e implications of the systems . As observed i n the ILO report on Computer Integrated Manufacturing: Th e Social Dimension (Ebel 1990) , for example, there has been a strong US constituency promoting wha t som e hav e dubbed th e "moonshot " or "sta r wars " approach t o CIM, i.e . the promotio n o f extremely capital intensiv e and hig h technology factory designs and exemplary models that attempt to utilize the latest developments in information technology an d process control equipmen t to fulfil th e long standing technocrati c drea m o f th e unmanne d or automati c factory . Promote d b y th e American Department of Defense, suc h large corporate vendor s as General Elec tric (MacDonal d 1987 ; Nobl e 1984) , an d use r multinational s such a s Genera l Motors an d Boeing , thi s computer integrate d and highl y automated "factor y o f the future" concept has been develope d a s part of the attempt to restore American competitiveness i n the fac e o f lo w wag e competitio n fro m newl y industrialized countries and the "Japanese threat" . This concept has been weakened by evidence that man y o f th e exemplar y factorie s o f th e futur e hav e becom e costl y 'whit e elephants' unabl e to match Japanese productivit y or meet thei r expected targets . In addition, growing experience wit h the introduction of information technology has reveale d th e centra l importanc e o f huma n and organizationa l changes, bot h in ensurin g the effectiv e use o f th e technolog y an d a s a sourc e o f productivity increase i n their own right .

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In the face of evidence collected that between 40 and 70% of total improvements can b e attribute d to bette r logistic s an d organizationa l changes (Ebe l 1990:47) , one of the dominant themes no w present in US business and organizational journals is the centra l significanc e of human and organizationa l support for efficien t manufacturing rather than a reliance on what are now perceived t o be excessively high levels of automation (Badham 1989) . In the face of current experiences eve n in relativel y lo w levels of CIM, there i s now a not inconsiderable lobb y of management consultants , engineering organizations , and university research centres , as well as vested interest s within user firms and organizations, promoting the idea that the key to productivity is greater attentio n to the "human factor " an d "organizational redesign". In this context, the human centre o r anthropocentric design constituency represents a n attempt to define these human and organizational factors i n a specific direction - on e that builds upon rather tha n undermine s 'craft ' traditions of worker autonomy, creativity and skill . The interventions of this constituency ma y occu r a t three strategi c levels : i n the developmen t o f globa l CI M concepts; i n the creation of generic CIM componen t technologies; an d in the development and introduction of CIM systems for specific firms. The constellations of human factors, socia l science, compute r system , engineering and government groups an d institution s supporting 'sociall y responsible ' development s i n thes e areas ar e worth y of promotion . This wil l only be so , however, if their activities are understoo d fo r wha t the y are : th e action s o f a specifi c technologica l con stituency to expand its role in CIM syste m desig n and development. It represent s a constellatio n o f veste d interest s an d socia l concerns , group s an d institutions, that ar e presently relativel y fragmente d and far weaker than other 'technocratic ' constituencies. I t is for this reason tha t the activities of coordinating groups such as th e IFA C Socia l Effect s o f Automatio n Committee , th e MODE M technol ogy, wor k an d organizatio n network , th e CAPIR N productio n cultur e research group, the FAST activitie s in stimulating the development of an anthropocentri c research network, and the book series and journals established by publishers such as Springe r (e.g . Artificia l Intelligenc e and Societ y journal and book series ) ar e so important. The promotion b y this constituency of 'European ' solution s to the production problems associate d wit h technocrati c CI M approache s ma y o r ma y no t com e to have a significant impac t o n the shap e an d diffusio n o f CIM. It s activities ar e best seen , however , a s those o f a constituency worthy of promotio n rathe r tha n a grou p wit h unique insight into 'th e requirements' o f CI M o r th e vanguar d of a revolutionar y shift t o a ne w 'humane ' worl d of work . It i s already observabl e that the earlier forerunner s of th e constituency in the lat e 1970 s an d 1980 s such as Mik e Cooley , Howar d Rosenbroc k an d Pete r Brödner , an d th e programme s they initiate d or were part of, have now been supplemented by a new generation of researchers and programmes (Badham/Schalloc k 1990 ) The changes, debate s and critiques that this involves should not be interprete d i n terms of the collaps e or fragmentation of the constituency but rather as inevitable developments within

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a constituenc y whic h need s t o bot h giv e a coherenc e t o it s ow n activitie s an d enroll outside interests. I t is this constituency that can or should be influenced and promoted b y labour representatives an d others sympatheti c to their aims . Whether this group will continue to adhere t o the concepts o f human centred o r anthropocentric systems, or replace these by more neutral terms such as "interdis ciplinary syste m design " o r "comprehensive innovatio n processes", will depen d in par t upo n th e dominanc e o f differen t section s withi n the constituenc y an d i n part upon strategic negotiation s wit h potential allies i n government programmes , CIM system vendors , consultancy organizations, etc. Fro m th e point of view of a direct sociall y oriented innovatio n policy, however, it will b e importan t to retain the explicitly political element of actual system development, i n selecting for promotion system s tha t approximate mor e toward s th e "post-Taylorist " rather than "neo-Taylorist" options. Whethe r thi s is conducted unde r such label s a s human centred an d anthropocentri c remain s t o b e seen . Thes e concept s do , however , suggest a desig n philosoph y an d general orientatio n tha t remains o f centra l im portance, i n a sens e becaus e of , rathe r tha n despite , it s inherentl y controversial nature. Despite it s presenc e a s a technologica l constituenc y promoting a particula r socially directe d innovatio n path, however , i n term s o f numerica l strengt h an d practical achievements i t remains relatively weak. As identified i n the ILO report, initiatives ca n b e observe d withi n technolog y agreements establishe d b y trad e unions, th e developmen t o f ne w form s o f syste m desig n b y socially responsible engineers an d associations an d government programmes promoting human factors considerations i n CIM syste m development . However , a s discussed else where, there i s substantial evidence o f the restricted characte r an d limited effects of technology agreements, th e isolation of many 'human factors' group s to a small and organizationall y weak minorit y of engineers , and , despit e importan t excep tions, th e comparativ e insignificanc e o f governmen t activit y in thi s are a whe n compared t o th e fundin g o f large-firm-dominate d an d technology-le d form s o f automation (Badham/Naschold, in this book; Badham/Schalloc k 1991b) .

6.3 Ke y Issues of Human Centre d System Promotion The project s an d programme s t o promot e huma n centre d system s represen t a n important attemp t a t sociall y oriente d innovatio n policy . Ye t som e reflection s on th e ke y problem s an d challenge s facin g thes e activitie s throw som e ligh t on the practica l difficultie s facin g all such form s o f innovatio n policy. Three issue s will b e briefl y addresse d here : th e problem s o f direct promotion methods ; th e dilemmas o f a technology orientation; an d th e adoptio n o f a meaningfu l social orientation.

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6.3.1 Direc t Promotio n All form s o f direc t technolog y promotio n ar e commonl y recognize d a s facing two majo r problems: firstly , th e relativ e insignificance o f direc t governmen t expenditure compared t o business expenditure and the effect o f indirect government activities; and, secondly, th e difficult y o f ensuring that the recipients o f govern ment fund s fulfi l th e intention s of th e fundin g programm e withou t the us e o f overly restrictive bureaucratic regulative measures . With regard t o the first problem, ther e ha s been muc h discussion within Ger many and Sweden ove r the usefulness of promoting "exemplary models " of new technology an d wor k humanizatio n through government funding. I n the case of the German Humanization of Work programme, there was substantial controversy generated earl y o n in the programm e ove r th e larg e amount of funding give n t o Bosch a s an exemplary model. Mor e recentl y i n Sweden, th e LO M programm e has been deliberatel y developed b y the Work Environment Fund in opposition t o the earlier Developmen t Programme base d on the philosophy of setting up "bestpractice" models (Gustavse n 1987) . A s argue d b y critics o f exemplar y models , the allocation o f moneys to companies large and sophisticated enoug h to become good models , and in sufficient quantitie s necessary t o assure the influence of government programme criteri a on the project, act s as a severe drai n on programm e resources. Moreover, i t is questioned whether other companies wish to copy leading edge examples as considerable scepticism is expressed ove r the applicability of conditions i n larger innovative firms to other enterprises. With specific referenc e to sociall y oriente d models , i t has bee n observe d tha t firm s ma y b e les s willin g to copy organizational/social models than technological ones (Klei n 1991b). In a current revie w of CI M implementatio n i n Germany, fo r example , nearl y all th e firms brought in external consultants to assist with the technology, yet practically none hired externall y for organizational assistance. 3 I n opposition to the critical view, other s stres s th e influenc e tha t model s hav e i n definin g an d transferring scientific paradigms, an d point to the strong impac t that economically successful models, suc h a s tha t provide d b y Japanes e manufacturin g techniques , hav e on the productio n imagination . The whol e questio n of th e diffusio n o f suc h mod els remains controversial, wit h more 'realistic ' proponent s emphasizing the need for a detaile d breakdow n o f direc t economi c benefit s as a ke y diffusio n factor , while others stres s the priority of changing existing measures of productivity and economic benefit s to incorporat e a broader rang e o f socia l a s well as economi c considerations. With respec t t o th e secon d problem , a ke y difficult y fo r direc t promotio n programmes i s that it is the large firms and established researc h an d consultancy institutions tha t have bette r link s to policy-maker s an d administrator s an d hav e the resources and expertise availabl e to apply for funding an d carry out projects . In th e proces s thes e companie s an d institution s have a stron g impac t o n ho w the actua l project s ar e conducted , an d attemp t t o transfor m thes e project s i n

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a manne r tha t conform s wit h thei r ow n interest s an d expertise . Ther e are , fo r example, a numbe r o f example s fro m th e Europea n programme s o f Germa n Fraunhofer Institute s interested i n CIM influencin g programme s suc h as Eurek a and the FAMOS projects in the direction of their interests. Similarly, humanization of wor k project s carrie d ou t b y engineerin g institutes i n th e area s o f assembl y and robotic s hav e been know n to defin e humanization primarily in terms o f th e automation of detailed jobs or the further development of robots, o n the grounds of health and safety, that are then not specifically developed fo r the complex forms of welding etc. that create the ergonomic problems (FAMOS Project Members 1990) . In order to counteract suc h reorienting of the programmes, potentially away from programme goals , increase d tim e and effor t mus t be spent o n specifyin g project requirements, monitoring and evaluating progress, etc . Yet , these activitie s make it even mor e difficul t fo r smalle r firm s an d les s substantia l research institute s to obtain and effectively use the money available. Direct funding programme s must , therefore, b e develope d i n a manne r that addresse s th e difficul t tas k o f taking into accoun t th e effec t o f th e institutiona l contex t withi n which the programm e is embedded , an d a s par t o f a se t o f integrate d measure s t o foste r a favourable institutional an d cultural climate for reform .

6.3.2 Technolog y Orientatio n As commented above , on e o f the key considerations in socially directe d innova tion i s t o appl y socia l criteri a earlie r o n i n th e desig n o f technolog y an d wor k systems. Where , however , thes e activitie s are promoted b y technolog y oriente d public institutions or programmes - suc h as, for example, the European Commis sion ESPRI T an d FAS T programme s o r th e Germa n Researc h an d Technolog y Ministry, this ma y create an excessive concer n wit h the reshaping of technolog y to the relative neglect of the organizational features o f new production systems . As commented by leading researchers an d trade unionists in this area, the amount of tim e an d effor t required t o develop ne w technologie s ma y b e bette r spen t on projects t o assist the way i n which these technologie s ar e implemented and used (Hammarstrom 1990 ; Dankbaa r 1990a , 1990b) . Moreover , give n th e acknowl edged difficult y i n gainin g effectiv e collaboratio n betwee n socia l scientist s an d engineers (Rosenbroc k 1990 ; Corbet t e t al . 1991) , th e conduc t o f man y suc h projects withi n engineerin g institution s is likel y t o lea d t o a n overl y dominan t emphasis o n th e engineering an d technica l aspect s o f th e problems, ofte n i n accordance wit h th e particula r engineerin g specialit y tha t a particula r institution wishes t o develo p an d promote . A carefu l an d balance d approac h need s t o b e taken, therefore , t o no t onl y th e importanc e o f socia l interventio n at differen t stages o f th e innovatio n cycl e bu t als o th e realisti c abilit y t o mak e effectiv e changes a t each of these stages .

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6.3.3 Socia l Orientatio n As emphasize d b y Charle s Edquis t i n thi s volume, the explici t introduction of political an d ecological concern s int o technology policy requires effective lobb y groups in society with an interest in these areas . Thi s phenomenon is more com plex tha n th e existenc e o f organize d interests , fo r ther e ar e a broa d rang e o f conditions tha t influenc e th e formatio n of a popular sens e o f grievance an d then act to enhance or prevent such grievances being transformed into political issues addressed a t the centr e o f government. Involve d in this process ar e cultura l and institutional factor s tha t influenc e public perceptions , interes t grou p formation , and the general 'non-decision ' making processes within public bureaucracies and political partie s tha t selec t whic h issue s ar e give n consideratio n (Luke s 1975) . Without the presence o f favourable 'external ' condition s and 'internal ' support , government projects an d programmes integratin g social an d ecological concern s into technolog y polic y ma y b e trivialize d or interestin g onl y a s a legitimator y phenomenon to prevent protest. In the discussion o f socially oriented innovation , for example , frequen t reference s ar e mad e t o th e risin g educationa l leve l an d expectations of the workforce. These, i t is argued, exert a pressure for appropriate work reforms additional to that created b y new technology an d changing markets (Grootings 1990 ; Brödner 1990) . This theme, prevalent in post-industrial writings in the early 1980 s (Scott 1990) , is particularly emphasized b y commentators on the pressures fo r work humanization in West Germany and Sweden.(Edquist/Glimell 1989; BMFT 1990) . There has , however, been relatively little systematic researc h on th e strengt h o f this phenomenon i n the context o f the implementatio n of new technology, it s relativ e influenc e o n trad e unio n and managemen t perceptions , and it s promotion b y the education an d training establishment. Some interesting suggestions have, however, been mad e by researchers o n Sweden an d West Ger many concerning the influence of the supply of skills and government influenced employment level s on corporate approache s toward s exploitin g these skill s and overcoming potential absenteeism problem s (Sorge e t al. 1983 ; Edquist/Lundvall 1989). The existence of such conditions is of importance in assessing th e significance of trends to replace terms such as "human centred design" or "work humanization" by "interdisciplinar y design" o r "integrated technology , wor k an d organization " approaches (Kid d 1990b ; de n Hertog/Schöde r 1989) . Withou t th e presenc e o f social an d politica l lobbies ensurin g that these categorie s includ e effective con sideration of working conditions desired b y the workforce, the y will all to easil y be limited to restricted economi c requirements and legitimatory phraseology. The more 'neutral ' term s o f "comprehensive " o r "interdisciplinary " desig n o f ne w systems i s accompanied b y a n emphasi s o n th e socia l gain s achievable through the overla p betwee n change s t o enhanc e economic efficienc y an d work humanization. A s detaile d b y Ela m an d Börjeso n (1991) , thi s has becom e a dominant "language o f workplace reform" i n Sweden (Elam/Borjeso n 1991) . However, a s

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observed a t the firm level by Janice Klei n and a t the industr y level by Ela m an d Börjeson, wher e worker s hav e previousl y ha d a substantia l degree o f wor k au tonomy, there is greater resistanc e to organizational reform s tha t may restrict this autonomy - eve n whe n thes e ar e presented a s "post-Taylorist" in many impor tant respects (Elam/Borjeso n 1991 ; Klei n 1991a) . Oppositio n i s also observabl e amongst less skilled workers in countries such as Australia to reforms that may increase the gap between highl y skilled and favoured "core" groups and less skilled "peripheral" ones (Badha m 199la) . I f socio-economic innovatio n processes ar e to be meaningfully sociall y oriented, they must be directed i n a manner that takes into consideratio n thes e want s an d desires . Nationa l condition s wil l clearl y b e influential i n determining what these want s and desires are , whethe r they can b e considered, an d i f there i s a wil l t o d o so . These condition s rang e fro m th e in dustrial structures and skill formation processes in the national economy, through the strengt h of collective bargaining associations and industria l relations system characteristics, t o the governmental structure s and the party in power. A realistic assessment o f thes e condition s is a n essentia l componen t o f an y attemp t to se t up effectiv e direct promotio n activitie s as par t o f a sociall y oriented innovation policy. Som e importan t researc h i n this area i s being conducted b y a numbe r of European programme s an d institution s including those o f th e Europea n FAS T programme, th e CAPIRN network , and individual university-based programmes such as ADD-TECH (Linköping , Sweden) and MERIT (Maastricht, Netherlands).

7 Conclusio n In it s repor t o n Ne w Technologies i n th e 1990s: A Socio-Economic Strategy, the OEC D (1988a ) argue d fo r a bette r understandin g o f "th e comprehensiv e innovation process " an d th e importan t technolog y polic y rol e o f "constructiv e technology assessment" . Thi s requires , a s they observed, a radical change i n the direction of technology policy . In their words , Government scienc e an d technology polic y i s at a crossroads. Th e polic y trajectory which has survive d ove r th e las t 3 0 years , wit h it s almos t uniqu e focu s o n R&D , need s t o have it s boundar y line s redrawn. Thes e line s wil l b e broader , les s minimalistic , an d les s 'market failure ' inspire d than the y appeare d a t th e outset . The y involv e a ne w phas e o f experimentation with new institutiona l structure s and arrangements (OEC D 1988a:45) .

In this process, there are important opportunities open for the introduction of more socially oriente d innovatio n policies. Yet there ar e at the sam e time , as we have seen fro m the above discussion, substantial problems in defining an d implementing suc h policies . A s ha s bee n witnesse d i n discussions o f ESPRI T an d FAS T programmes t o introduce "human centred" or "anthropocentric" technologies, and in reviews of the German Humanization of Work programme, thi s has even led to

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Opposition to the use of explicit terms suc h as "human", "sociall y oriented" , etc. These terms, i t is argued, arous e antagonis m from man y established interests . I t is better, they argued, to participate in what has been aptl y termed "th e rhetori c of consensus politics". B y this is meant conformity to the increasing acceptanc e o f the central importance of socio-economic innovation and policies, an d attempting to shap e th e definitio n o f th e "technica l requirements " o f ne w technolog y i n a favourable direction, i.e. according to formally unvoiced socially oriented criteria . In contrast, it has been and can be argued that we are presently at the crossroad s in th e publi c understanding of technolog y an d innovation . If thi s is so , an d th e public has become increasingl y awakened t o the political nature and social significance o f technologies, t o promote a view that these problem s ca n be 'managed ' by 'polic y experts ' woul d b e t o seriousl y undermin e the potentia l tha t th e ne w technologies provid e fo r increasingl y open publi c discussion an d consideratio n of technology policy issues. On these grounds the explicit raising of political and social issue s by the use of such terms as "socially oriente d technolog y policy " or "socially oriente d innovatio n policy" i s a strong argument in their favour, despite the necessaril y controversia l nature of an y attemp t t o defin e their exact nature . Such term s ma y b e easil y condemne d a s "valu e laden" , "ideological " o r "ide alistic" bu t thes e ma y b e thei r strengt h an d importanc e i f th e issue s addresse d correspond t o broad rangin g social concerns. I f they do not, they are likely to fai l in any case. In the more particula r task of addressing th e key issues raise d b y socially ori ented innovation policy, a recent OECD (1989 ) report on Government Policies and the Diffusion o f Microelectronics provide s som e interesting guidelines. Four priority issues for what we have called socio-economi c innovatio n policy are outlined. Firstly, the promotion of training and skill development. Secondly , improvement s in the quality, availability and use of consulting services. Thirdly , widening of the technology base , to ensure ready acces s to technology from all sources. Fourthly , monitoring and assessment of the use and effects of new technologies . These sam e issue s ar e als o ke y areas fo r sociall y oriente d innovatio n policy initiatives in the manufacturing area. Criteria for skill based manufacturin g could be clarifie d an d applied i n new training and skill development initiatives, as well as being incorporated int o systematically organized consultanc y approaches an d institutions. Som e o f thes e criteri a an d initiative s ca n b e see n i n suc h varie d contexts a s the research repor t provide d b y the ISF Research Uni t in Munich for the Karlsruh e CIM Centr e an d th e "Contributio n o f Labour " componen t o f th e Australian National Industry Extension Service . Th e widening of the technology base can be further extended throug h further technological innovation s promote d by humanization of work organizations an d principles, and further attention pai d to the way in which, for example, softwar e development firms can be influenced to apply such principles . Due to the limited amoun t of public funds available , an attempt to influence the strategies o f developer firms may be preferable to directly

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funded projects . Discussion s aroun d thes e issue s ar e presently being undertake n in th e Arbeit und Technik programm e o f the German BMFT . Finally, a s confirme d b y th e OEC D repor t o n governmen t policie s an d th e diffusion o f microelectronics , furthe r informatio n i s require d o n th e natur e an d type o f ne w technologie s i n us e an d th e characteristic s o f users ; th e exten t o f their diffusio n b y industry , fir m size an d ownership ; th e obstacle s i n acquiring and usin g ne w technologies ; an d skills , trainin g and employmen t impacts . Thi s research agend a need s t o b e extended , however , t o includ e (i) a n examinatio n of th e dynamic s o f productio n technolog y desig n an d development , th e natur e of present development trajectories, an d criteria formulated a t an adequate leve l of generalit y fo r assessin g th e socia l desirabilit y o f thes e developments , (ii ) a classification o f sociall y desirabl e inter-fir m productio n systems , an d th e for m these tak e i n differen t industria l sectors , (iii ) a n examinatio n of th e exten t t o which thes e ar e diffuse d throughou t differen t sectors , an d th e exten t t o which the structura l characteristics o f particular types o f firms facilitate o r hinde r their development. Th e European FAS T programm e i s presently conducting a number of studie s i n som e of thes e area s i n FAS T Stud y No . 1 on Applie d Technolog y Assessment. Thes e issue s cannot , however , b e resolve d i n the abstract , no r can they be validly extended between culture s and across countries. An important part of thi s exercise, therefore , i s an examination of the type s of research institution s and policy making bodies suitabl e to carry ou t these studie s and initiatives. In conclusion, it is clear that if the concept of socially oriented technology policy is taken seriously it requires a radical reconsideratio n o f existing policies and in stitutions, and in the case of socially oriented innovatio n policy faces institutiona l obstacles eve n mor e fundamenta l tha n thos e facin g socio-economi c innovatio n policy. However, i f interesting and sporadic loca l initiatives or programmes ar e to be co-ordinated an d given relevanc e suc h issue s need t o be seriousl y addressed . This could, and should, be perceived a s the key technology polic y concern o f the 1990s.

Notes [1] Thi s tren d i s exemplified i n the wor k o f engineers an d compute r scienc e critic s suc h as Norbert Wiener , Id a Hoos, Mike Cooley, Howard Rosenbrock , Huber t Dreyfu s and Joseph Weizenbaum . Wit h particular focus on numerically controlled (NC) machines , computer aide d design (CAD ) equipment, and artificial intelligenc e (AI) programmes , this led to a general critiqu e of the technocratic hybri s that exaggerated th e power an d capabilities of the new machines an d programmes, an d an emphasis o n necessity an d desirability of preserving an d supporting huma n "tacit skills" , "operator experience" , and huma n "purposiveness" as a central element i n the new designs . [2] Th e classification of these groups and initiatives as a "social movement" i s contentious. As socia l movement s ar e usuall y define d i n contras t t o traditiona l forms o f politic s

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embodied i n trade unions , government programmes, etc. , th e descriptio n o f a se t of human centre d desig n initiative s that involv e such forms a s a social movemen t ma y be somewhat surprising . However, one of the central characteristics of the groups and initiatives involved is an explicit commitment to going beyond traditional trade union approaches an d for m o f governmen t action , an d th e espousa l o f man y o f th e values associated wit h social movement activities, e.g. orientation to direct action and cultural innovation, the formation of network/grassroots organizations, changes i n values and lifestyle, an d participation in changes i n civil society. Although , because o f its stron g links to mor e traditiona l trade unio n policies an d structures , this movement has a far greater degre e o f ambiguity than many others. Se e the discussion i n Scott (1990) . In addition, as a movement attempting t o directly reshape technology it involves a more or less fragmented network of researchers an d practioners from different intellectua l disciplines such as ergonomics, work science, industrial sociology, management science , computer science, and production engineering. Whether one can perceive a degree o f coherence an d integration amongst thes e sufficien t t o apply th e label "movement" t o their activities is a matter of not only debate bu t also action. What is certain, however, is tha t i t represent s a substantia l establishment o f veste d interest s an d ideologica l predilections for the "humane" reshapin g of technology and work. [3] Thi s i s one o f th e preliminar y unpublished findings o f G . Doer r at the WZB , Berlin , in the stud y currently being undertaken of CIM implementatio n in German firms .

References ACTU (1987 ) Australia Reconstructed, Canberra: Australia n Government Publishin g Service. Annerstedt J. , A . Jamiso n (eds. ) (1988 ) From Research Policy t o Social Intelligence, London: Macmillan. Badham, R . (1989) The Factor y o f the Future: A Concept i n Search o f a Reality, Discus sion Paper , Wollongong : Department of Science an d Technology Studies , University of Wollongong. Badham, R . (199la ) Huma n Centred CIM : Informatin g the Design/Manufacturing Inter face, in : Futures December : 1047-1060 . Badham, R . (1991b ) Compute r Integrate d Manufacturing : The Socia l Dimension , in : International Labour Review 3 (130): 373-392 . Badham, R. (1991 c) Work, Organisation and Culture, in: Artificial Intelligence an d Society 4 (5): 263-277. Badham, R . (1991d) Anthropocentric System s an d th e Australian Production Culture , in: CAPIRN Report to FAST on International Production Cultures, Bremen : Institut Technik und Bildung. Badham, R . (1992 ) Skil l Base d Design : Europea n Experience s an d thei r Internationa l Relevance, in : Prometheus 2(10) : 239-259. Badham, R. (1993) Smart Manufacturin g Techniques: Beyond Electroni c Drawing Board s and Turnkey Systems, in : International Journal o f Computer Integrated Manufacturing (in press) . Badham R. , J . Mathew s (1989 ) Th e Ne w Productio n System s Debate , in : Labour an d Industry 2 (2): 194-247 .

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Badham, R., B. Schallock (1990) The Human Centred Syste m Design Constituency , Working Paper, Berlin : Fraunhofer IPK . Badham R., B. Schallock (1991a) Human Factors in CIM Development: A Human Centred View from Europe, in: International Journal o n Human Factors i n Manufacturing 2(1) : 121-141. Badham R. , B . Schalloc k (1991b ) Th e Huma n Shapin g o f CIM , in : R.A.Peacoc k (ed. ) Information Technology and People, Milton Keynes: Open University/Peter Pereguinnes. BMFT (1990 ) Research an d Development Program "Wor k an d Technology" (Projec t Management Team "Wor k an d Technology" o n behalf of the Federa l Ministe r fo r Researc h and Technology), Bonn : BMFT. Boyer, R. (1989) New Directions in Management Practices and Work Organisation, mimeo, prepared fo r th e OEC D conferenc e "Technica l Chang e a s a Socia l Process : Society , Enterprises an d the Individual", Helskinki. Braun, E. (1984). Wayward Technology, London : Pinter. Braverman, H. (1974) Labor and Monopoly Capital, Ne w York : Monthly Review Press. Brödner, P. (ed.) (1987) Strategic Options for 'New Production Systems': CHIM: Computer and Human Integrated Manufacturing, Brussels : FAST Occasiona l Paper s No . 150 . Brödner, P. (1988) Options for CIM: 'Unmanne d Factory' versu s Skill-based Manufactur ing, in: Computer Integrated Manufacturing Systems 2 ( 1 ) : 67-84. Brödner, P . (1989) I n Searc h o f th e Compute r Aide d Craftsman , in: Artißcal Intelligence and Society (3) : 39-46. Brödner, P. (1990) The Shape o f Future Technology, London : Springer . Burns T, H. Flam (1987) The Shaping o f Social Organizations, London: Sage . Child, J . (1987 ) Organizationa l Desig n fo r Advance d Manufacturin g Technology , in : T. Wall , C . Cleg g an d N . Kem p (eds. ) Th e Human Side o f Advanced Manufacturing Technology, Chichester : Wiley, 145-163. Collingridge, D. (1980) The Social Control o f Technology, London : Pinter. Cooley, M . (1984) Architect or Bee?, New York: Abacus. Corbett, J.M., L . Rasmussen, F. Rauner (1991) Crossing th e Border, London : Springer. Couchman, P . (1990 ) Th e Rhetori c o f Consensu s Politics , Unpublishe d Ph. D Thesis , Wollongong: Departmen t o f Scienc e an d Technolog y Studies , Universit y o f Wollon gong. Daniel, W.W. (1987) Workplace Industrial Relations and Technical Change, London: Pinter. Dankbaar, B. (1990a) Prospects of Anthropocentric Production Systems in the Netherlands, Draft Repor t for FAST, Maastricht : MERIT. Dankbaar, B . (1990b) Interview, Berlin, January. Dickson, D. (1984) The New Politics o f Science, New York : Pantheon. Ebel, K.-H.(1990 ) Computer-Integrated Manufacturing: Th e Social Dimension, Geneva : ILO. Edquist, C., H. Glimell (1989 ) Swedis h Frontier s o f Change - A Guide to the Impact of New Technologies , Wor k Design s an d Managemen t Practices , repor t prepare d fo r th e Directorate fo r Socia l Affairs , Manpowe r an d Education , OECD, mimeo , Linköping: Linköping University (ADD-TECH Programme) . Edquist C., B.-A . Lundval l (1989) Comparin g Smal l Nordi c System s o f Innovation , paper presente d t o th e semina r o n "Nationa l System s Supportin g Technica l Progress" , Maastricht. Ehn, P. (1988) Work Oriented Design o f Computer Artefacts, Stockholm : Arbetslivcentrum.

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Elam, M., M. Börjeson (1991 ) Strategies of Flexibility or Rewording the World of Work in Sweden?, in : B. Jessop, H . Kastendiek , K. Nielsen and O. Pederse n (eds. ) Th e Politics of Flexibility, London : Edga r and Allen , 167-198 . Eiden, M. (1979) Three Generation s of Work Democracy Experiments in Norway: Beyond Classical Socio-Technica l Analysis , in: G . Cooper , E . Mumfor d (eds.) Th e Quality o f Working Life i n Western and Eastern Europe, London: Associated Business Press, 21 -32. Elliott, D.(1986 ) The GlC's Innovatio n and Employment Initiative - Second Report , in: TPG Occasional Paper 11 : 1-3 . FAMOS Projec t Member s (1990 ) Intervie w wit h Fraunhofe r IP K Participants , Berlin: Fraunhofer IPK , January. FAST (1991) Anthropocentric Technology and Systems (AT&S), in : Newsletter 1 , Brussels: European Commission. Fischer, F . (1988) Techno-Corporatism i n the Unite d States: A Critique of Contemporar y Technocratic Theor y an d Methods , in : WZ B Discussio n Paper F S 1 1 88-105 , Berlin : WZB, 1-25 . Fleck, J., J. Webster, R. Williams (1989) The Dynamics of IT Implementation: A reassessment of Paradigms and Trajectories of Development, in: Edinburgh PICT Working Paper Series 3 : 1-24 . Gottschalch, H. (1989) Examples of Human-Centred Work Design in CIM Structures, IFAC International Federation of Automatic Control, Symposium on "Skill Based Automated Production", Vienna. Grootings, P. (ed.) (1990) New Forms of Work Organisation Berlin , New York : de Gruyter. Gustavsen, B . (1987 ) Report o n th e LOM Programme, Ontario : Ontari o Centr e fo r th e Quality of Working Life. Hammarstrom, O . (1990 ) Intervie w wit h Chie f Researc h Officer , Swedis h Whit e Colla r Unions, May, Stockholm. Hayes, R., R. Jaikumar (1988) Manufacturing's Crisis: New Technologies, Obsolet e Orga nizations, in: Harvard Business Review September-October : 77-85 . Hertog, J.F . den , P . Schöder (1989 ) Social Research fo r Technological Change: Lessons from National Programmes i n Europe an d North America, Maastricht: MERIT. Hildebrandt, E. (1989) The Socia l Constitution of the Firm, paper presented t o "CAPIRN Workshop", Sant a Cruz, November. Johnston R. , P. Gummett (eds.) (1979) Directing Technology, London : Croom Helm. Kidd, P. (1990a) Telephone Interview, December, Berlin : Fraunhofer IPK. Kidd, P. (ed.) (1990b ) Organisation, People an d Technolog y i n European Manufacturing: Interdisciplinary Research fo r the 1990s , Brussels: CEC/FAST Consultanc y Report. Klein, J. (199 la) A Re-examination of Autonomy in Light of New Manufacturing Practices , in: Human Relations X (43): 23-31 . Klein, L. (1991 b) Contributions to CIM Gestaltungswissen: International Experiences Panel Meeting, Göteborg: IVF . Lukes, S. (1975) Power: A Radical View, London: MacMillan. MacDonald, L. (1987) Bargaining for Lynn's Factory of the Future: A Case Study, Working Paper 87-6, Lowell : University of Lowell. Mathews, J. (1988) A Culture o f Power: Labour Movement Goals for th e 1990s, Sydney: Pluto Press . Mathews, J. (1989a) Tools o f Change, Sydney : Pluto. Mathews, J. (1989b) Age o f Democracy, Melbourne : Oxford Universit y Press.

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Mayor, F.(I989 ) Human Resources an d the Cultural Dimension, in: L. Emmeru (ed.) On e World o r Several?, Paris: OECD , 176-191 . McLoughlin, I. , J . Clar k (1988 ) Technological Change a t Work, Milto n Keynes : Ope n University Press . MDA (1990 ) Description o f Activities, Stockholm: Arbetsmiljofonden. Metall un d Elektr o Industri e Verband (1990 ) Mensch un d Arbeit, n o place : Metal l un d Elektro Industrie Verband. Molina, A.H. (1989) The Transputer Constituency: Building up UK/European Capabilities in Informatio n Technology , PIC T Researc h Repor t Series No.l , Edinburgh : University of Edinburgh. Naschold, F. (1980) Problems of a Society-oriented Research and Development Policy - The Humanization o f Wor k Progra m a t th e Crossroads, Workin g paper serie s IIVG/dp/80 213, Berlin: WZB Naschold, F . (1983 ) Technologica l Politic s i n th e Federa l Republi c o f Germany , IIV G Discussion Paper s 7, Berlin: WZB. Noble, D. (1984) Forces of Production, Ne w York : Knopf. O'Connor, J . (1973) The Fiscal Crisis of the State, London: S t James' Press . OECD (1988a ) New Technologies in the 1990s: A Socio-Economic Strategy, Paris : OECD. OECD (1988b ) Science an d Technology Policy Outlook, Paris : OECD . OECD (1989) Government Policies and th e Diffusion o f Microelectronics, Paris : OECD. OECD (1990 ) Conference on "Technical Change a s a Social Process : Society , Enterprises and the Individual", Helskinki , December . Oscarsson, B. , O. Hammarstrom, G. Karlsson , R. Lindholm (1988) Λ New World o f Work, The Development Programme, Stockholm : Swedish Work Environment Fund. Piore, M. , C. Sabel (1984 ) The Second Industrial Divide, Ne w York: Basic Books . Pock Too, N.G . (1987) Workers in Technology Transfer, in: Japan Institut e of Labour (ed.) The Role o f Labor an d Management i n Technology Transfer, proceeding s of the "Asian Regional Conference o n Industria l Relations" , Tokyo . Reich, R. (1983) Th e Next American Frontier. Harmondsworth : Penguin. Rosenbrock, H. (1990) Designing Human Centred Technology, London : Springer. Rothwell R. , M . Dodgso n (1989 ) Smal l Firm s i n Europe , in : Science an d Public Policy February: 30-45 . Schallock, B . (1989) Skill Enhancin g Shop Floor Control fo r SMEs, Conferenc e Proceedings "New Manufacturin g Imperatives" , London: AXIOM Systems Design . Schmandt, J . (1989 ) Th e Futur e of Scienc e an d Technolog y i n th e Unite d States, WZ B Occasional Pape r FS 1189-108 , Berlin: WZB . Schultz-Wild, R . (1990 ) Applicatio n of I T an d th e Restructurin g of Productio n Work i n West Germany , paper presente d t o th e "Ne w Technologies , Institutiona l Change s an d Working Life Seminar", Holmenkollen , Oslo. Schumacher, E. (1974) Small i s Beautiful, Ne w York : Abacus. Scott, A. (1990) Ideology an d the New Social Movements, London : Unwin Hyman. Self, P . (1975) Econocrats and th e Policy Process, London : Macmillan. Sorge, Α. , G. Hartmann , M. Warner, I . Nicholas (1983) Microelectronics an d Manpower in Manufacturing, Aldershot : Gower. Sorge, A., W. Streeck (1988 ) Industria l Relation s and Technical Change: The Cas e fo r an Extended Perspective , in: R. Hyman, W. Streeck (eds. ) New Technology an d Industrial Relations, Oxford: Blackwell , 1-31.

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Sweeney, P. (ed.) (1985 ) Innovation Policy, London: Pinter. Thorsrud, E., F. Emery (1970) Industrial Democracy in Norway, in: Industrial Relations 2 (9): 35-51. Walton, R., G. Susman (1987) People Policies for the New Machines, in: Harvard Business Review March-April : 98-106. Warner, M. , W . Wobbe , P . Brödne r (eds. ) (1990 ) Ne w Technology an d Manufacturing Management: Strategic Choices for Flexible Production Systems, Chichester : Wiley. Weiner, E., A . Brown (1989 ) Huma n Factors: Th e Ga p Betwee n Human s and Machines, in: Th e Futurist May-June : 46-61. Williams, B. (1988) Review o f the Discipline o f Engineering, vol. 16, Canberra: AGPS . Zuboff, S . (1988) In th e Age o f th e Smart Machine: Th e Future o f Work an d Power, Ne w York: Heinemann.

Technology Policy : Th e Interaction betwee n Governments an d Market s Charles Edquist

1 Introductio n Some o f the questions which prompted me to write this chapter were 1: - Ho w does state intervention interact with the market mechanism in the field of technological change? 2 - Ca n technology policy have social an d environmental objectives? - Ho w can research infor m and advise policy-makers about technological change and technology policy? Given the character o f these questions, I can, of course, only scratch the surface of each issue. I will try to address the issues of why, when, where and how technology policies ar e o r coul d b e pursued. 3 I wil l attemp t t o d o thi s b y addressin g th e objectives o f technolog y polic y (sectio n 4), th e reason s fo r stat e interventio n in the process of technological change (section 5) and the instruments used (section 6) t o achiev e th e objectives . Befor e touchin g upon these issue s I will, however, briefly discus s som e feature s o f technologica l chang e an d technolog y polic y (section 2 ) and how technology policy is actually formulated and implemented in practice (sectio n 3) . Obviously, a chapte r coverin g thi s vas t groun d ca n no t b e ver y detailed . M y point of departure was that technology policies are designed and implemented and that this is often done on a rather weak analytical basis. Base d on my experience in studyin g technology policies and evaluating technology policy programmes, 1 wanted t o discus s ho w technolog y policie s ar e actuall y designed i n practice, a s well a s reflecting ove r alternative modes o f doing it.

2 Som e Characteristics of Technological Change and Technology Polic y In a long-term perspective - sa y one hundred years - i t is intuitively evident to everyone that technical change has played an enormous role in shaping the presently

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advanced societies; especiall y i n reshaping them from almost exclusively agricultural societies t o dominantly industrial ones t o service and information societies. Modes of transportation and everyday life hav e been similarl y changed i n funda mental ways. Christopher Freeman, on e of the pioneers in the research fiel d of the economics o f technological change , writes : "technologica l capacit y i s the main source of the competitive strengt h of firms and nations" (Freema n 1987:1) . Hence, technica l chang e i s o f grea t importanc e fo r thing s lik e productivity growth, competitiveness , welfare , workin g conditions , etc. 4 A t th e sam e time , it i s a fac t tha t the development , diffusion , adaptatio n an d us e o f technologie s are socially constructed i n the sense that they are shaped by social economic and political factors. The market mechanism and private actors are crucial mechanisms shaping technical change i n the current world. What is actually addressed whe n discussing technology policy in this chapter i s how social an d political forces can also shap e technica l change - a s a complement to market forces. Technology ha s certai n rathe r peculia r characteristics . Accordin g t o Ke n Arrow - Nobe l Prize winner in economics - technolog y can be regarded a s information (Arro w 1962) . And all information - suc h as a new method of production should, from th e welfar e poin t of view , be availabl e free o f charg e t o everyone. This would lead to optimal utilization of the information (e.g. th e technologies). However, if technologies are available for everyone free, no one has an incentive to invest in research an d development (R&D) , simply because n o one could make money b y developing new technologies. 5 Theoretically , i t can b e shown that the market mechanis m lead s t o underinvestmen t in researc h (an d development ) i n a marke t economy . Thi s i s on e reaso n fo r stat e interventio n in th e proces s o f technological change . If technologica l change ha s suc h an enormous importanc e an d i f it cannot b e left t o market forces alone, then state interventio n in the process of technologica l change ma y b e ver y important . Therefore , i n thi s chapter, I wil l dea l precisel y with the interaction between th e market mechanism and public intervention in the process o f technologica l change. 6 Par t o f thi s public intervention is often calle d "technology policy" . Before continuing, it may be useful to specify what I mean by technology policy. In th e abstrac t i t is, of course, al l publi c intervention in the proces s of technical change.7 Mor e specificall y technology polic y i s implemente d b y a numbe r of public policy-making bodies that use specific instruments to influence the process of technical change . It ma y also b e usefu l t o distinguish between direc t o r explicit and indirec t or implicit technology policy. A direct technology policy is government intervention expressly intende d t o influenc e th e proces s o f technica l change . Example s ar e R&D subsidie s and publicl y supported disseminatio n of informatio n about new technologies. Indirect technolog y policy , on the other hand, includes policies that are no t primaril y designe d t o influenc e technica l change , bu t whic h influenc e technical change to a greater or lesser extent anyway. Examples are trade policies,

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exchange rat e policy , military securit y policy , industria l polic y an d fiscal policy. The consequence s o f indirec t technolog y policie s fo r technologica l chang e ar e often unintende d as well as unforeseen b y planners and decision-makers. Indirec t technology policie s ma y b e inconsisten t with, or even counterproductiv e to, th e direct technology policies. 8 However, it is the policy that is actually implemented that matters for the process of technological chang e - regardles s o f whether it has been explicitl y formulated or not. In other words, direct and indirect policies should be studied together. Many policy actors make decisions which affect issue s of technology policy. Technology policy that is actually implemented will by necessity , therefore, consis t of many, very different an d heterogeneous polic y components.9 This indicates that there are large problem s involve d in coordinating a consistent and compatible technolog y policy. Currently technolog y polic y i s increasingl y being considere d t o b e a n 'inde pendent' polic y fiel d i n man y countries. 10 Thi s mean s tha t publi c intervention in th e process of technological chang e i s becoming mor e integrate d an d coordinated. I t als o mean s tha t wha t I cal l indirec t (implicit ) technology policie s ar e increasingly take n ou t int o the ligh t an d ar e transforme d int o direct o r explicit ones. Example s o f thi s increasin g independenc e ar e tha t technolog y polic y i s explicitly delineate d an d addresse d i n general, recurren t publi c documents (e.g . proposals t o Parliament) and that national technology programme s ar e designe d and implemented . Whe n technolog y polic y i s becoming mor e 'independent ' i n these ways , inherent contradictions and conflict s betwee n variou s objectives that exist within (the direct and the indirect) technology policy are often exposed - a s discussed i n section 4 . Technology polic y i s also a very important policy field in many countries, and in countrie s wher e i t i s les s important , there ar e sign s tha t thi s i s changing . In Japan technology polic y has been a n enormously important policy field since the 1950s, althoug h its significance has decrease d i n recen t year s (se e sectio n 3.2) . The sam e i s tru e for Sout h Kore a wit h a tim e la g o f abou t a decade . I n many European countries , technology policy i s becoming increasingl y important. Thi s is also true for the European Community, where technology policy has also played a role of unifying th e community (McKelvey 1989).' ' It i s very interesting to not e that the importanc e o f civilia n technolog y polic y also seem s t o be increasing in the USA. There are many indications in this direction. For example, in a report (OT A 1990) , the Offic e o f Technology Assessmen t in Washington has proposed th e establishment of a "Civilian Technology Agency " to allocate government money to strategic technologies. 12 This is important, since "national security " has been th e only reason, accepted b y the administration, for public support to technical change i n the USA. 13 Reason s behin d this change are the ongoin g demilitarizatio n and th e fac t tha t Japa n i s takin g over th e lea d i n an increasin g number of technolog y fields ; radios , TVs , automobiles , semiconductors, etc . Countrie s lik e South Kore a an d Taiwa n ar e als o catchin g u p fast .

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In additio n a n integrate d Europ e ma y provid e ne w challenge s i n th e future . A s a consequence , wit h Clinton as Presiden t th e U S administratio n has announce d that it will pursue a civilian technology polic y on a large scale. The developmen t o f technolog y polic y int o a mor e independen t an d mor e important 'polic y field ' wil l probabl y continu e in man y OECD countrie s i n the 1990s.

3 Ho w Technology Policy is Formulated and Implemented in Practice The mos t importan t goa l o f (civilian) technology polic y i s i n practice increase d productivity growth and competitiveness. 14 Let me, in this section, address a few possible mechanisms for technology policy-making, i.e. ways in which technology policies ar e - o r could be - formulated . Such policie s coul d b e the outcome of or originate in theories, imitation , lobbyism or what I call "diagnostic" analyses . I wil l devot e on e subsectio n t o eac h o f these . I wil l not , however , presen t an y systematic analysi s of thes e mechanisms . Wha t follow s i s rather a genera l an d impressionistic discussion with illustrating examples from Sweden an d Japan. In sections 4-6,1 will address the objectives, reasons and instruments of technology policy i n a somewhat more systemati c manner . 3.1 Th e Usefulnes s o f Theory as a Basis for Technology Policy First I wil l discuss wha t assistance theor y ca n provid e t o policy-makin g i n th e technology field. We saw, in section 2 , that the automatic functioning o f the market tends to lead t o underinvestment in research an d development. Th e reaso n i s that firms have problems appropriatin g the results of their R&D; since technical advances ca n be copied by other firms they are reluctant to invest in R&D, in spite of the fact that new technologies woul d increase thei r efficiency (Arro w 1962). 15 This market-failur e theory explain s why firms underinvest in R&D. Economist s and policy-makers often conside r thi s to be a justification - o r theoretical foun dation - fo r government interventio n in the process of technological change . However, suc h polic y implication s whic h emerg e fro m standar d economi c theory ar e actuall y no t ver y helpfu l fo r policy-maker s fro m a practica l poin t of view . The polic y implication s of economi c theorie s ar e to o blun t t o provid e much guidanc e for governmen t interventio n in the process of technica l change . These theorie s ma y simpl y indicat e tha t ther e ar e sometime s reason s fo r stat e intervention i n th e fiel d o f researc h an d developmen t (R&D) , particularl y in regard t o basi c research . The y d o no t indicat e ho w muc h intervention 16 o r i n which particular research field (where and when) one should intervene. And they

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say almos t nothin g about ho w t o intervene , i.e . whic h instrument s to us e an d how.17 The main conclusion so far is that standard economic theor y is not of much help when i t comes t o formulatin g and implementin g specific technolog y policies. 18 Neither, however, hav e other socia l scienc e disciplines developed theorie s whic h are directly usefu l fo r policy-making. If theor y shal l b e abl e t o infor m technolog y policy , w e nee d theorie s abou t what determines and shapes technica l change. Like al l complex socia l processes , technical change has many determinants. And these are economic, socia l as well as political. What would be needed i s therefore theories abou t the determinants of technical chang e whic h do not emanate fro m any particular academic discipline , but place s technica l change a s such i n focus. These theories shoul d b e interdis ciplinary and no t confined to, or restricted by , any one singl e discipline (Edquist 1988:section 4) . W e nee d t o kno w wha t th e various determinant s ar e an d ho w they influence various stages (invention , innovation, diffusion) o f different classe s of technical change. 19 Only then can theory b e a guide for policy. However, suc h theories d o not exist.20 Therefore - fo r the time being - th e specific formulation of policies are , an d must be, largely based on something besides theory . 3.2 Imitatio n - A Common Mode of Technology Policy-making If theory is not very helpful, how is technology policy formulated and implemented in practice ? Wha t ar e policy-makers actuall y doing - an d why? Upo n wha t do they base their decisions? A ver y common mean s o f formulating direct technolog y polic y is imitation. 21 In most countries, policy-makers ar e simply doing similar things to what has been previously don e i n othe r countrie s (o r i n th e sam e country) . There i s a visibl e copy-cat effect . A technolog y programm e i n a n advance d natio n give s birt h t o another somewher e els e an d al l resembl e on e another . Everyon e want s t o b e sailing on top of the wave of global technology . Obvious example s ar e the many national technolog y programme s i n th e field s o f informatio n technologies, ne w materials and biotechnology (Edquis t 1989c:28) . This habi t of imitatio n means tha t technolog y polic y ha s becom e reactive ; it is accommodated to , and become s an uncritical importer o f foreign technologie s and polic y instruments . Another importan t consequenc e o f imitatio n is tha t th e variations i n structura l condition s betwee n countrie s ar e ofte n no t take n int o account. I n additio n yo u ar e boun d t o b e a lagge r whe n imitating . If severa l countries interven e i n th e sam e way , late-comer s wil l probabl y los e out . I t i s normally better to try to intervene in new and creative ways if you are a late-comer . And, above all , to adapt the mode o f intervention to the national characteristics!22 Some o f u s woul d lik e t o se e greate r effort s t o adap t technolog y polic y t o the specifi c socio-economic characteristic s an d objectives o f different countries.

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By doin g so, technology polic y could - t o some extent - influenc e the direction of technica l chang e an d th e wa y technologie s ar e used. 23 I n thi s way , national characteristics can - i n a dynamic sense - eve n be the basis of advantages which can give a certain country , and its firms, a competitive edge. However, ther e mus t b e someon e t o imitate ! Someone ha s t o b e a creativ e innovator. Various countries hav e played thi s role i n particular time periods. Th e experience o f relatively backward Japa n in the 1950 s was more important in this respect - o n the civilian side - tha n most other countries. Therefore, I will briefl y address th e historical experience o f Japan.24 Japan owe s muc h o f it s economi c succes s i n th e postwa r perio d t o th e ver y active role played by the state in many sectors, including state intervention in the form of industrial and technology policies. Accordin g to Allen (1981) the Japanes e government too k advic e fro m bureaucrat s an d administrator s whos e economic s had been learn t by experience - rathe r than from professiona l economists . Som e of these advisor s wer e engineer s wh o ha d been draw n by the war into the man agement o f publi c affairs . "The y wer e th e las t people to allo w themselves t o be guided b y th e half-ligh t o f economi c theory . Thei r instinc t was t o fin d a solu tion fo r Japan' s postwa r difficultie s o n th e supply side , i n enhance d technica l efficiency an d innovation s in production. They though t in dynamic terms . Thei r policies were designed to furnish the drive and to raise the finance for an economy that might be created rathe r tha n simply to make the best us e of the resource s i t then possessed" (Alle n 1981:68 ; m y emphasis). Japan's factor endowment a t that time was characterize d b y a large suppl y of unskilled labour , a n extrem e scarcit y o f capital , an d out-of-dat e technology . I f Japan ha d specialize d i n lin e with it s resourc e endowment , i t woul d hav e bee n common sens e - i.e . conventional economics wisdo m - to concentrate on labourintensive sector s suc h a s textiles , clothin g an d simpl e meta l products . Instea d capital- and technology-intensive products wer e chosen ; lik e steel , shipbuilding , and chemical fertilizers , and later radios, television sets, watches, petrochemicals , cars and machine tools (Alle n 1981:70). This wa s obviousl y in conflict wit h standar d economi c theory. 25 A long-ter m dynamic rationality was allowed t o dominate ove r a short-term stati c rationality. The objectiv e wa s t o creat e ne w resource s an d comparativ e advantages , rathe r than to build upon existing ones. How wa s then the selection o f industries for development made ? Tw o criteria had to be satisfied before a product was selected. - Th e first one was that the product mus t be one for which the income-elasticity of demand in the world as a whole was likely to be high. When choosing amon g possible candidates , th e one with the highest income elasticity wa s preferred . - Th e second criterio n was that of comparative technical progress. Even i f the costs o f manufacturin g a produc t wer e hig h a t th e initia l stage , i t woul d b e preferred t o other s i f there wa s a probability of exceptionally rapi d technical

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progress which would be reflected in steeply fallin g costs (Allen 1981:71, who refers to Shinohara 1980). These criteria reveal those products for which global demand grows rapidly, i.e. what can be called growth products. 26 A strategi c technolog y an d industria l policy, intended t o stimulat e growth an d competitiveness, must be able to contribute to the creation of conditions favourable to specialization in growth sectors and growth products. Therefore , thes e criteria are certainly interesting to other countries trying to do the same thing. 27 A Vice-Minister of MITI expresses a similar view: The Ministr y o f Internationa l Trade an d Industr y decided t o establish in Japan industrie s which require intensive employment of capital and technology, industries that in considera tion of competitive cost of production should be the most inappropriate for Japan, industries such as steel, oil refining, petrochemicals, automobiles , aircraft, industrial machinery of all sorts, an d electronic s includin g electroni c computers . Fro m a short-ru n static viewpoint, encouragement o f such industrie s would seem to conflict wit h economic rationalism . But, from a long-range viewpoint, these ar e precisely th e industries where incom e elasticity of demand i s high, technological progress i s rapid, an d labou r productivity rises fas t (quote d inFransman 1985:55-56) .

Christopher Freema n draw s the following conclusion: The main point about MITI' s role ... is that it has persistently pursued long-term strategi c objectives t o stimulate new developments i n relation to technology an d industrial structure over th e pas t 4 0 years . I t ha s bee n pragmati c abou t it s methods , dependin g upo n th e particular stage of development, but it has always striven, in collaboration with the scientific and technologica l community and wit h industry , to develo p a well researched 'vision ' o f the future (Freema n 1987:38-39) .

The strength and importance of MITI and other Japanese ministries is also stressed by Clyde Prestowitz (198 8 100-121) . On th e whole , ther e ha s bee n n o profoun d conflicts betwee n th e bureaucrac y and private industry in Japan. They hav e been aimin g at the same targe t - rapi d industrial growth . Th e chie f medi a fo r policy-makin g have bee n th e Industrial Committees of MITI, where civil servant s and industrialist s met t o decide o n future strategies an d on the means required for reaching the goals agreed upon. According to Allen, the means most commonly employed by government during the postwar period wer e lendin g policies, protectio n (hig h tariffs o r quantitative import controls), subsidies, tax concessions (e.g . fo r R&D expenditures), exchange controls to promote exports , encouragemen t o f dumping (Allen 1981:73-75). To these mean s shoul d b e adde d th e Japanes e hostilit y towards foreig n direct in vestment as a means of acquiring technology from abroad. Othe r mechanisms of transfer o f technology wer e - fo r a long time - strongl y preferred; mechanism s which implied a lower degree of foreign control ove r the Japanese economy . Some additiona l lessons an d conclusion s of th e Japanes e experienc e ar e th e following. Japanes e technolog y polic y has , a s a whole , bee n fairl y supply ori ented, i.e . dominate d b y a technolog y pus h approac h (a s oppose d t o deman d

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pull).28 To a large extent, the Japanese polic y has also bee n product technolog y oriented; th e compositio n o f products produce d i n Japan was , a s w e hav e seen , changed throug h state-induced structural adaptation. This structural change was, of course, accompanied by the introduction of advanced process technologies and new forms of organization in the economy. 29 Until recently, Japanese technology policy wa s concerned mainl y with the diffusion (includin g acquisition , imports, absorption an d assimilation ) of produc t technologies invente d and innovate d in foreign countries. 30 Japanese technology policy was extremely pragmatic an d not based o n economi c theor y no r theor y emanatin g from an y othe r scientifi c dis cipline. The policie s i n Japan wer e characterize d b y a hig h degree o f industrial targetting and strategic 'picking the winners', e.g. by allocating foreign exchange to certain firms, industries and products . Th e policie s wer e extremel y interventionist an d the economy strongl y regulate d b y the state - eve n a t the firm and product level. 31 I t is clear that the combination of state intervention and the market forces in Japan wa s much more efficien t tha n it would have been t o rely only on th e marke t force s an d privat e actors. A t the sam e time , i t has been convincingly shown that the proportion o f government financing of private R&D carrie d out i n industr y has bee n ver y lo w a s compared t o othe r larg e OEC D countrie s (Odagiri/Goto 1990:tabl e 1) . I n othe r words , th e governmen t rol e o f advisor , coordinator and catalyst has been mor e importan t than its role as financer. 3.3 Lobbyin g as a Mechanism behind Technolog y Policy Another mechanis m behin d th e formulatio n and implementatio n of technolog y policies is lobbying. Private firms, state agencies and other organizations often act with th e objective to influence technolog y policie s i n order t o get them designe d and implemente d i n thei r ow n interest . Thi s i s a commo n mechanism , ofte n combined wit h imitation. One example i s the National Microelectronics Programme (NMP ) in Sweden . The decision in Parliament concerning this was taken in 1983 and the programm e ran for the next five years. In a detailed analysi s of the conception of NMP, Hans Glimell has shown (Glimell 1988) that this programme, to a large extent, emanated from militar y needs. A t that tim e - jus t lik e the present - Swede n wa s highly dependent upo n th e US A wit h regar d t o th e suppl y o f electroni c components . Fifth generatio n computer technology, based upo n rapid VLSIs, were developed . In th e USA, th e VHSIC (Ver y High Speed Integrate d Circuits ) programme wa s running. At th e same time , the USA had indicate d that a more restrictiv e polic y with regard t o exports could materialize. The NM P emerge d ou t o f a project withi n FM V (Th e Swedis h Defenc e Ma terial Administration) . The possibilitie s of establishin g domestic productio n of advanced integrated circuits intended for JAS, the then planned lightweight, multirole military aircraft had been investigated. However, this was not very successful.

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To put further pressure o n the Swedish componen t producers , relation s wer e es tablished betwee n FM V an d ST U (Th e Swedis h Boar d fo r Technica l Change) . After preparation and lobbying, the decision to establish the programme wa s taken by Parliamen t in December 1983. 32 A simila r combination o f imitatio n and lobbyin g wa s behin d th e succeedin g programme: Th e National Information Technology Programme (1988-1992) . This IT programme wa s system-oriented rathe r tha n component-oriented (lik e NMP). The agencie s behin d wer e i n thi s case Swedis h Telecom , ST U an d FMV , wit h Swedish Telecom playin g the role FMV ha d in NMP (Glimel l 1989). 33 In both the national programmes mentioned, the large Swedish firms also played an importan t rol e i n the implementatio n of th e programme s an d the y use d mos t of th e publi c mone y involved. 14 O f course , thes e firm s an d th e stat e agencie s involved greatly influence d th e specific formation of the projects constitutin g the programmes. The y were important pressure groups , lobbying in their own interest. External actor s hav e als o playe d a ver y importan t rol e i n the norma l o r con tinuing activitie s of ST U (Th e Swedis h Boar d fo r Technica l Change) . ST U ha s dozens of reference groups designed t o give advice to STU in the formulation and implementation of its various programmes. I t is, of course, natura l that represen tatives of firms and other actors in the reference group s pla y the role of promoting their ow n interests . The y ca n therefor e b e expecte d t o b e a conservativ e forc e cementing old structure s rather than one flexibly initiating activities in emergin g technology fields - whic h are normally not represented b y strong lobbyists. 35 In the nex t section , I wil l tr y t o sho w thi s by summarizin g an evaluatio n (Edquist 1989a) of state support to technology renewa l in the engineering industry - whic h I have carried ou t fo r the Swedis h Ministr y of Industries.

3.4 "Diagnosti c Analyses" - a n Alternative Basis for Technology Policy-making I will first summarize the evaluation of state support to technology renewal in the Swedish engineering industry. To be brief, I will only present the main conclusions and concentrat e upo n th e activitie s of ST U (Th e Swedis h Boar d fo r Technica l Change).36 - Th e Swedish engineerin g industr y account s fo r about 40 % of industrial production, 45% o f valu e added and 53% o f Swedish industria l exports (Edquis t 1989a:13-14). - Swedis h engineerin g industry is very advanced a s regards automatio n of production. Sweden i s the only Old' industrial country that keeps pace with Japan as regards th e diffusion o f new production technology. 37 There are more com puter controlle d machin e tools , industria l robots, CA D system s an d flexible manufacturing system s pe r employe e i n th e engineerin g industr y in Swede n

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than i n th e US A an d th e res t o f Wester n Europe . Countrie s lik e the U K an d the USA are far behind.38 (Edquist/Jacobsson 1988:104 ; Edquist 1989a:59 , 81 , Tables 4 and 6; Edquist/Lundvall 199 1 :Table 10 ) - Whe n it comes to product technologie s Sweden i s much less advanced. If high technology product s ar e defined as products wit h a high R& D expenditur e in relation t o th e valu e of production , th e hig h technolog y conten t o f Swedis h engineering productio n i s lowe r tha n i n mos t othe r OEC D countries . Th e proportion o f productio n emanatin g fro m R&D-intensiv e subsector s i n th e engineering industry was in 1986 38.3% fo r all OECD countrie s on the average , and only 24.8% i n Sweden. As a ratio of exports the corresponding figures were 39.1 and 28.1, respectively (Edquis t 1989a:62 , 83, Tables 7 and 8.). 39 - Th e total ST U support t o production technologie s i n the engineering industry was 6 7 millio n SEK i n 1987/88 . The expenditur e o f th e industr y as a whol e was 941 million SEK, whic h gives us a relation of 7.1% (Edquist 1989a:50) . - Th e tota l ST U support t o th e development o f product s fo r the engineerin g industry was at most 60 million SEK. The industry expenditure was here 8,587 million SEK , whic h gives u s a relation of 0.7% (Edquis t 1989a:50) . - Henc e STU spends 10. 1 times more on production technologies tha n on product technologies i n relatio n t o th e tota l R& D expenditure s o f th e engineerin g industry. The overall conclusion i s of course tha t STU priorities must be questioned. STU is spending a lot of resources i n a field where Sweden is among the most advance d countries in the world while spending very little in a field which must be considere d a seriou s long-ter m proble m fo r the Swedish economy. 40 In the former field, the market function s i n a satisfactor y manner . I n th e latter , i t doe s not . N o on e seems t o hav e questione d ST U activities , an d th e engineerin g programm e ha s been goin g on in a similar fashion for years - t o a cost o f hundreds of millions of Swedish crowns . There is, of course, a steering committee for the STU engineering programme whic h includes actors wit h a stake i n the engineering industry. Their vested interest s see m to have been t o continue in a similar manner over the years . My method - use d in Edquist (1989a) - i n trying to show that the STU money allocated t o the engineering industry has been used for the less important purposes may b e called a "problem-identifying" o r "symptom-describing" analysis . With this I mea n a n empirica l an d comparativ e analysi s of th e leve l o f technolog y diffusion. Th e symptom-describin g analysi s mus t b e empirical becaus e ther e i s no way to identif y thes e kind s of problems specificall y enough - fo r purpose s of policy-makin g - o n the basis o f a theoretica l analysi s alone. 41 A problem identifying analysi s must be comparative sinc e one can not determine whethe r a level is high or low in a country withou t comparing i t with other countries. Suc h an analysi s require s tha t a larg e amoun t o f data i s collected - an d normally, it is no t readil y available . Furthe r thes e dat a mus t be mad e comparabl e betwee n countries, i.e . i t ha s t o be normalize d i n on e wa y o r th e other . Thi s mean s tha t

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a symptom-describin g analysi s is quite labou r intensive and time-consuming as shown b y Edquis t (1989a) . However, i t is perhaps th e onl y efficient wa y t o find out whe n ther e i s reaso n t o conside r stat e interventio n and i n whic h situations there ar e no reasons t o do so. 42 Ideally, however , w e shoul d also kno w wh y th e technolog y leve l i n a certai n country i s lowe r tha n i n othe r countrie s befor e a polic y o f interventio n i s for mulated an d implemented . A descriptio n o f th e symptom s i s no t enough , sinc e it onl y indicate s whe n an d wher e t o intervene . Therefore , causa l analyses , i.e . explanations of development an d diffusion o f technologies ar e also an important precondition for the formulation and implementation o f effective government poli cies. Such analyses may indicate how to intervene, e.g. whic h instruments to use; causal explanatio n is thereby importan t t o ensure tha t intervention is efficient. 43 The combinatio n of a symptom-describin g analysi s and a causal explanatio n of the problem s ma y b e calle d a "diagnostic " analysis . This ma y b e a n importan t basis fo r an efficient therap y o r treatment. If differential technolog y level s cannot be causally explained, technology policy i s ou t o f necessit y relativel y ad ho c i n nature : much i s lef t t o chanc e an d t o leaps in the dark - o r at least in the fog. Hence, i t is - agai n - strongl y justified to stress th e nee d no t only fo r empirical an d comparative , bu t also fo r explanatory and theoretical work . However, th e inability to explain is not a reason t o abstain from interventio n in the process of technological change. Because problems identified ma y sometimes hav e ver y severe consequences - fo r the economy, fo r the environment o r for the social condition s - trial-and-erro r interventio n may be necessary.

4 Objective s o f Technology Polic y As indicated in section 3, the primary objective of the civilian technology policie s of most countries are often increased productivit y growth and competitiveness. 44 The policies are governed b y a rather narrow economistic orientation. This has so far o n the whole implicitly been assume d t o be the case also in this chapter. An importan t questio n i s whethe r thi s necessaril y ha s t o b e th e case . Ca n noneconomic objectives be the rationale for technology policy? More specifically: can, for instance, technology polic y have environmental or social objectives, e.g . less pollutio n or a less risky working life. The answe r is , o f course : "yes , i n principle" . I t i s perfectl y possibl e t o hav e non-economic objectives for technology policy. The main argument for this is that it has been the case for decades in one very large and important part of the society. I am, of course, thinking of defence-related interventio n in the process of technological change. Thi s intervention has absorbed a major part of the resources spent on technology polic y in man y countries. An d i t has certainl y not bee n governe d

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by narrow economic objectives like economic growt h and competitiveness, but by national security, military strength and independence. Of course, this intervention has bee n supporte d b y stron g lobb y groups i n the relevan t countries. And thes e lobby group s have economic interests . And the military-related intervention has had spin-off consequences fo r civilian technologies an d for growth and competi tiveness. But the main objective o f the state intervention have been non-economic. At the same tim e this intervention has often been widel y politically accepted by the public in the relevant countries. An obviou s conclusion is that state suppor t t o develop an d diffus e sociall y or environmentally soun d technologie s ca n b e a n objective o f technolog y polic y if this ha s politica l support . I t i s certainly common tha t th e marke t produce s un acceptable result s for th e environment. The sam e i s true, for example, o f health hazards an d socia l condition s in industry . There ar e therefor e reason s t o con sider stat e interventio n in the proces s o f technologica l change t o th e extent that technologies are involved as determinants of these problems . However, this does not happen automatically. First of all, it must be known tha t the technologies use d hav e unacceptabl e environmental or socia l consequences . It wa s no t lon g ag o tha t w e wer e ignoran t abou t ver y dangerou s socia l an d environmental consequence s o f certai n technologies . A n obviou s conclusio n i s that technology assessment should be practiced to a much larger extent than what is toda y th e case . A t presen t mos t produc t an d productio n technologies ca n b e used befor e w e kno w ver y muc h abou t the consequence s thereof . Historically, asbestos an d DDT wer e widely used for decades befor e the general public knew that they were dangerous for humans and/or fo r the environment. However, firm s usin g o r producin g th e technologie s ar e ofte n muc h bette r informed abou t the risks than the general public. It is therefore absolutely crucial that technolog y assessmen t i s done i n a wa y tha t makes th e result s available to the public and that this information i s widely disseminated. In one sector, technology assessment i s practiced t o a much larger extent than in others : th e pharmaceutica l industry . Whe n a dru g based o n a ne w chemical entity i s developed , it s us e ha s t o b e approve d i n ever y countr y befor e bein g put o n th e market . Eac h countr y ha s a n agenc y wit h the purpos e o f approving new drugs . Th e objectiv e is of cours e t o mak e sur e that the drug doe s not have dangerous side-effects. This takes years and can, of course, be very costly in terms of opportunities foregon e (patient s may di e i n vai n becaus e o f the delay) an d in terms of costs for experiments and analyses . The drug approval syste m seem s t o function fairly wel l and is accepted by the industry as well as by politicians and the general public . Perhaps th e technology assessment regulation s in the pharmaceutica l industr y could b e a mode l fo r th e evaluation o f ne w technologie s i n othe r sector s a s wel l - a t leas t a s regard s new chemicals ? I t coul d lea d t o a drasti c reductio n in th e ignoranc e abou t th e negative social and environmental consequences of these new technologies. It is, of course, advantageous if technology assessment ca n also be as 'proactive ' an d

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'constructive' a s possible - a s discussed i n other chapter s include d in this book by Badham and van Boxsel . The cas e o f nuclea r powe r i n Swede n i s a n exampl e wher e non-economi c factors have partly been governin g technology policy . After the oil crisis in 1973 , energy polic y started t o emerge a s an independen t policy field. In th e 1970 s th e public becam e increasingl y concerned ove r th e risk s attache d t o th e operatio n of nuclea r plants. Th e Harrisbur g acciden t increase d thi s concer n an d i n 198 0 a referendu m wa s held . Th e outcom e wa s tha t n o ne w nuclea r plant s shal l b e built in Sweden an d that existing plants shall be taken out of operation. Later on , Parliament decide d tha t all nuclea r powe r shal l be taken out of operation at the latest by 2010. 45 A lesson t o be learned from the Swedish nuclea r case is that one way in which non-economic aspects can influence technology policy is when the issues becom e matters o f intensiv e public debate an d ente r th e genera l politica l agenda. 46 I f technology issue s enter the public agenda, the n political, social, ethical and environmental issues will have a greater chance o f influencing technolog y policies in additio n to economic issues . Furthermore, technology policy may mean that the technology issues enter the democratic sphere . Technolog y polic y is, in principle, democratically controlled in a pluralisti c democracy . Thi s ma y b e advantageou s fro m th e standpoin t of accountability and participation. However, i f non-economi c objective s becom e mor e importan t fo r technol ogy policies , the n contradiction s and conflict s betwee n variou s objectives wil l certainly emerge . Fo r example , ther e wil l b e conflict s (o r trade-offs ) betwee n economic objective s an d socia l o r environmenta l ones. Economi c growt h may , for example , lea d t o increasing social an d environmental problems - mor e tha n balancing the benefits of growth. Such conflicts will probably become more com mon in the future. O r perhaps i t is more correct t o say that they will become mor e visible and apparent . There ar e example s wher e sociall y oriente d technolog y policie s hav e bee n proposed and/o r attempted . Fo r example , th e so-calle d Brook s Repor t (OEC D 1971) represente d a vie w wher e socia l goal s an d qualitativ e aspects o f growt h were stresse d a s much as quantitative ones i n the field of science an d technology policy. Th e repor t als o stresse d stat e interventio n to complemen t th e operatio n of th e marke t (OEC D 1971:89) . However , thes e tendencie s hav e mainl y bee n undercurrents an d hav e no t becom e dominan t stat e technolog y policie s i n th e OECD countries. For example, we have seen - i n section 3. 2 - tha t the Japanese technology polic y wa s strongl y oriented toward s quantitativ e industrial growt h with a supply-push perspective.47 The mai n conclusion s o fa r i s tha t th e objective s o f technolog y polic y must be politically determined . Socia l aim s ma y b e determine d throug h a politica l process. Then objective s o f technology policy ma y b e derived fro m thes e wide r social goals - o r the objectives of technology policy may be politically determined

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in a direct way . In the first case the - politicall y determined - socia l objectiv e may be higher productivity growth or less pollution. If there is a relation between these objective s and technology, technology policy may be a means of achieving the goal. I n the second case , it may, for example, be politically determined that a certain technolog y leve l is an objective as such.

5 Reason s fo r State Intervention i n the Process of Technological Chang e I have implicitly dealt with reasons for state interventio n in the previous sections . Sometimes I have also don e s o explicitly, but without being systemati c about it . Let m e therefore, i n this section, try to summariz e the argument s o r reasons fo r state intervention i n the process of technological chang e i n a market (o r mixed) economy. I t is here taken for granted tha t the social objectives an d the objectives of technology policy - whicheve r they are - hav e been politically determined , as discussed i n the previous section. The state should consider intervention in the process of technological change if the market and private actors fail to spontaneously achieve the objectives wanted.48 This i s the mai n reason fo r state intervention . There ar e n o reasons t o conside r intervention i f th e marke t fulfill s th e objectives . O n th e othe r hand , ther e ar e reasons t o conside r interventio n when thi s does no t occur . Hence , th e rol e o f policies i s to complement markets; not to substitute for them. 49 In othe r word s ther e mus t b e a problem whic h i s no t automaticall y solve d by th e marke t force s fo r stat e interventio n to b e considered. 50 Normall y suc h problems ca n not - a s argued i n section 3. 1 - b e identified onl y wit h the help of theory (emanatin g from economic s o r from other disciplines). 51 Th e best wa y to identify thes e problem s seem s t o be ver y pragmatic (an d primarily empirical) about it and carry ou t what I have called a diagnostic analysis, i.e. a combination of a descriptio n o f the symptoms an d problems wit h - i f possible - a causa l explanation of them. Diagnostic analysis is what has been practiced i n Japan (and South Korea) in a very pragmatic and undogmatic manner during the post World War II period (se e sectio n 3.2) . The fac t tha t the problem s warrantin g the consideratio n o f stat e intervention cannot be identifie d onl y or mainl y with the help of theory mean s tha t the argumentation here is very different fro m th e one pursued within standard economics . The theory of market failure in economics i s formulated and discussed withi n the framework o f a stric t and forma l model : th e theor y o f genera l economi c equi librium i n a n abstrac t economy . A s w e sa w i n sectio n 3.1 , i t produce s polic y implications which are too blunt to be useful fo r technology policy-makers. Thi s is related t o the fact tha t the policy implications are considered to be valid for all

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economies; difference s between specifi c economies ar e not considered. There are also issue s whic h canno t b e satisfactoril y handled withi n the framewor k o f th e model, e.g. change s i n product technology (an d product quality). However logical and strict the abstract theory of standard economics is , it must, in th e end, b e confronte d wit h empirica l reality. The conclusion s reached i n the abstract mode l worl d must be shown to be valid also in the real world. This is not an eas y tas k an d i s rather seldoml y attempted . Hence , th e us e o f marke t failur e theory also lead s to problems o f translating the conclusions reached in the mode l world into policy conclusions valid i n the real world . It would have been advantageous, and easier, to argue within the framework o f a strict model of some kind, using some explicit criterion - e.g . Pareto optimality as a guidin g principle for technolog y polic y formulation. However, fo r reason s mentioned i n sectio n 3.1 . an d above , thi s woul d no t provid e muc h guidanc e for policy-maker s when considering intervention in the process o f technological change.52 Therefore, i t is necessar y t o take a ste p backward s a s regards rigou r and for mality compared to standard economics. Whe n I talk about "problems" which are not spontaneousl y solve d b y th e market , thi s is no t don e withi n th e framewor k of a forma l model , bu t o n a n empirica l basi s an d i n a pragmati c way . Thi s i s intentional. Th e reaso n i s tha t thi s mod e o f analysi s i s mor e usefu l a s a basi s for policymaking in the field of technological change. It is basically an empirical question to determine whether politically determined goal s are fulfille d o r not by the automati c operation o f the market. 53 Becaus e o f th e underdeveloped stat e of the ar t wit h regard t o theor y (o f technologica l chang e an d technolog y policy), there is no alternative to a pragmatic basis for technology policy. However, eve n i f there i s a problem whic h i s not automaticall y solved b y th e market forces, stat e intervention in the process of technological change ma y stil l not b e justified. The stat e mus t also hav e th e capabilit y to solv e o r mitigat e the problem. Otherwise the intervention should not materialize, since the result would be political failures. Ther e ma y b e two reason s wh y th e stat e doe s no t have this capability. Firstly , the proble m ma y b e unsolvabl e from th e politica l level i n an absolute sense. Then stat e interventio n would, of course, b e futile . Secondly , th e state may nee d t o develop its capability in order t o be able to solve the problems . A detaile d analysi s may , fo r exampl e b e neede d befor e interventio n can tak e place. The n i t ma y b e necessar y t o carr y ou t a diagnostic analysis. New polic y instruments or implementing institutions may also be needed. Then thes e hav e to be developed o r created befor e interventio n shall - o r can - tak e place . Accordingly, there must be an identified problem an d a state capability to solve it, i n order for state intervention to be called for. To conclude, bot h th e marke t an d th e governmen t hav e a rol e t o pla y i n th e process of technological change. It is not a question of a choice betwee n them . It is rather a question of finding an appropriate combination of the two in the specific field of technological change. A relevant question is which activities in this proces s

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are mos t efficientl y handle d b y th e marke t an d whic h by th e government . The answer to this question may certainly vary between countries as well as over time.

6 Instrument s o f Technology Polic y Once the objective s of technolog y polic y ar e specifie d and i t is clear tha t intervention i s motivated, it is necessary fo r th e relevant actor(s) t o find out ho w th e objectives ca n be achieved. Therefor e ther e i s reason t o discuss variou s technology policy instrument s further - an d somewhat mor e systemati c than in earlier sections. This will be done in a rather general way below. Let me start b y distinguishing between instrument s on the suppl y side and on the deman d side . I f we combine this distinction with one betwee n developmen t and diffusio n o f technology we get the Figure 1 below. Let me briefly discus s th e four boxes in the order i n which they are numbered. 54 Technology polic y instruments on the supply side th

e demand sid e

Development o f technologies (1

) (4

)

Diffusion o f technologies (2

) (3

)

Figure 1: Technolog y polic y instruments

(1) A technology polic y instrument on th e suppl y side geare d toward s devel opment o f technologie s i s public financin g o f research . These subsidie s can b e channelled to basic research a t the universitites or they can benefi t privat e actors such as firms. This is what I have previously in this chapter called "R&D policy" . (2) Whe n i t come s t o th e diffusio n o f technologies , on e instrumen t on th e supply side is the (Swedish) system of technical attaches. These offices ar e placed in the major technologically advanced countries and their role is to report bac k to Sweden about the existence and use of new technologies. Th e objective is to help widen the spectrum of technologies available to Swedish actors. This is a supplyside instrumen t since it is intended to increase th e supply of technologies which are availabl e fo r absorptio n an d diffusio n t o domesti c firm s an d othe r actors . Other ways to increase the domestic availability of globally existing technologies is t o establis h dat a bases , tak e par t i n internationa l educational exchange s an d contribute to makin g technological an d research cooperatio n betwee n domesti c and foreign actors as smooth as possible. Of al l ne w basi c technologie s availabl e in a smal l countr y lik e Sweden , th e absolute majority have their origin abroad. 55 I n this sense diffusion o f technolo -

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gies - includin g absorption o r assimilation - i s many times mor e importan t for Sweden tha n domestic developmen t o f technologies. However, technolog y polic y geared toward s diffusio n doe s not thereby necessaril y hav e to be a s many time s more important than policies to influence technology development . It may be the case that diffusion work s satisfactorily by itself and that state intervention thereby is not warranted. Thi s probabl y varie s between differen t field s an d categories o f technology.56 (3) A technology polic y instrument on the demand side which influences diffusion o f technologies (includin g choice an d use) is the procurement b y the public sector, i.e . public demand. For example, the public sector can, through its own demand, influence the choice between differen t kinds of energy source s an d thereby which energ y conversio n technologie s ar e used . Th e choic e betwee n differen t kinds o f publi c transport system s ca n hav e thi s effect ; fo r example , choosin g trams o r undergroun d instea d o f diese l busses . Th e stat e als o ha s a n indirec t influence ove r privat e deman d throug h laws , taxe s an d subsidies . A prohibition of direc t electricit y heatin g o r highe r petro l taxe s obviousl y affect s th e choic e between alternativ e energy technologies . (4) The mos t importan t technology polic y instrumen t on th e demand sid e in tended to influence the development of technologies is public technology procure ment. In this way not only the choice between existing technology alternatives can be influenced, but also which new alternatives are developed. Thi s is important in the production of defence (an d space ) material . Th e stat e simpl y orders weapo n systems whic h d o not exist - fo r delivery far in the future. 57 Publi c technology procurement is a way for the state to use its own (future) deman d as a technology policy instrument. On the civilian side, technology procurement ha s also led to considerable result s for the competitiveness of Swedish industry . Some examples are the relations between Swedish Telecom an d Ericsson (telecommunication switching equipment), between th e Swedis h Stat e Railway s and ASEA/ABB (railwa y equipment) and between Th e Swedis h Electricit y Agenc y (Vattenfall ) an d ASEA/AB B (equip ment to generate and transmit electricity). Public technology procurement in other countries has also had very important consequences fo r technology development. A similar policy instrument would be if the state decide d t o stop buying petrol or diesel drive n vehicles from a specific future date. This can be a part of a public technology procuremen t programme i f it is combined wit h an order for vehicle s with som e othe r kin d of engine . Th e stat e coul d als o us e it s influence over private deman d b y decidin g tha t petro l an d diese l drive n vehicle s canno t b e use d in certai n (urban ) areas fro m a futur e date . Th e latte r i s being discusse d i n Lo s Angeles, wher e regulation s with regar d t o maximu m degree o f pollutio n con sidered, woul d outla w present petroleum-base d engines . Give n the hug e marke t in Souther n California , this kind of 'negativ e technology procurement' i s a very potent technolog y polic y instrument. The incentiv e for motor-vehicle producer s

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to develo p alternativ e kinds of engine s i s extremely strong , particularl y if other metropoles ca n be expected t o follow the example of Los Angeles. 58 An importan t conclusio n which emerges fro m th e discussio n o f th e diagra m is that instruments on the demand sid e are very important for technology policymaking. I n additio n the y see m t o b e ver y efficient . Therefore , i f onl y a par t of th e tota l Swedis h publi c procuremen t o f abou t 6 0 billio n dollar s annually were simultaneousl y use d fo r technolog y polic y purposes , th e effect s o n th e development and diffusion o f technologies could be considerable . There ar e als o sign s tha t publi c procurement i s increasingly beginning t o b e consciously use d fo r technolog y polic y purpose s i n Sweden . On e exampl e i s the procurement o f refrigerators, whic h was coordinated b y the Swedish Energ y Administration (STEV ) i n 1990 . A competition wa s announced where the pric e was an order fo r a couple o f hundred refrigerators - wit h large r order s likel y in the future. The requirement was that the amount of freon and electricity necessar y for th e production and use o f the refrigerato r shoul d be considerabl y smalle r as compared t o existing designs. I n a very short time , one firm had designed a new refrigerator wit h the required characteristics. This is, by the way, also an example which illustrate s that the objectives o f technology polic y do not need t o be only economic, bu t can also be concerned wit h protecting the ozone laye r and limiting energy use . As mentione d earlier , however , explici t technolog y polic y i s often - i n practice - considere d t o be equal to (supply-oriented) R&D policy in a narrow sense , i.e. square (1) in the Figure.59 This means that a supply-push perspective i s heavily dominant over a demand-pull perspective o n technologica l chang e an d technol ogy policy . If thi s dominance i s broken, th e possibilit y o f integratin g social an d environmental dimensions in technology polic y increases . Such a broade r vie w o f technolog y polic y - includin g supply an d deman d and developmen t a s well as diffusion - als o increase s th e possibilities o f small countries lik e Swede n t o pursu e a successfu l polic y fo r technica l change ; th e prospects o f a small country to pursue a successful R&D policy ar e very limited since th e possibilitie s t o influenc e technica l chang e i n a globa l sens e ar e ver y limited. The possibilities to influence diffusion (absorption , assimilation) and use of technology are much greater (Edquist 1989b). However, o n the whol e the ver y rapid process of internationalization which is currently going on makes it increasingly difficul t to carry out technology policy as well as national policies in other spheres - particularl y for small countries. The Swedish home-base d multinationa l firms are becomin g increasingl y footloose . ASEA's merger wit h Brown-Bovery from Switzerland in 198 9 has recently bee n followed b y merger s involving , for example , SAA B Automobil e (wit h Genera l Motors), Volv o (wit h Renault ) an d STOR A (wit h Feldmühle) . I n additio n t o the fac t tha t th e nationalit y of severa l o f th e larges t 'Swedish ' firm s ca n b e questioned, th e process of internationalization is also proceeding i n other fields . For example, a very important change in the 1980 s was the development of a very

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free flow of capital across boarders.60 This means that the possibility of pursuing an independen t monetary polic y in a country like Sweden i s severely restricted . Further, the Swedish flow of direct investments abroad i s enormous. For example, during the first half of 1990, Swedish corporations bought firms in Western Europe for a total of 72.2 billio n SEK. Thi s i s to be compared t o the acquisitions of U S firms of 32.7 billio n and of Japanese o f 10. 5 billion (Edquist/Lundvall 1991:35 ) The proces s o f internationalizatio n changes, drastically , th e basi c working s of th e so-calle d Swedis h model . Th e ol d mode l wa s base d upo n th e fac t tha t the Social-Democrati c stat e an d th e bi g firm s wer e mutually dependent . I f thi s dependency only goes one wa y in the future, th e basis for corporatism wil l erode and the position of the stat e (a s well as of the unions), in relation to capital, will be weakened . One consequence o f the process o f internationalization is that it becomes mor e difficult t o pursue a national technology policy . The possibilitie s of the Swedis h state to influence firms by means of R&D subsidie s (supply side) decrease. Als o concerning, for example, technology procurement (demand side), the possibilities of nationa l influence decrease . Between ASE A an d th e Swedis h stat e ther e wa s a mutua l relatio n where both partie s had advantages from cooperating an d wer e important t o eac h other . Fo r ABB , th e Swedis h stat e i s muc h les s important. 61 These transnationals do no t need Swede n an y longer , but the Swedish economy needs them . It seems lik e the difficulties fo r Swedish technology policy increas e most wit h regar d t o th e suppl y oriented instruments . Here, th e stat e resource s decrease ove r time ; i.e . i n relatio n t o th e resource s controlle d b y th e growing firms. A t th e deman d side , ther e ar e stil l considerabl e possibilitie s to influenc e technological change . Th e reason s fo r thi s ar e tha t technolog y diffusio n an d assimilation take place in Sweden, that the choice between technology alternatives occur in Sweden an d that the technology i s used in Sweden .

Notes [ 1 ] Thi s article has been writte n within the context of the ADD-TECH (Th e Anatom y of the Developmen t an d Diffusio n o f Ne w Technologies ) Researc h Programm e a t th e Department o f Technolog y an d Socia l Change , Universit y of Linköping , Sweden . The departmen t i s a n interdisciplinar y and problem-oriente d institut e carryin g ou t research an d offerin g a Ph. D programm e (bu t no undergraduat e programme) . Th e relations between technolog y an d socioeconomi c chang e for m th e central concern s of research. ADD-TECH i s one of severa l researc h programme s a t the department . It deal s wit h the economic , socia l an d politica l determinant s and consequence s o f the developmen t an d diffusio n o f ne w technologie s i n the productio n o f good s an d services. Various parts of a previous version of this article have been presented an d discussed at three conferences :

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- a t "II Encuentro Hispano-Sueco sobr e Democracia Industrial" , organized by Fundacion Sistema in Madrid, March 29-30, 1990 , - a t "Sozial orientiert e Technologiepolitik" , organize d b y the Institut für Höhere Studien i n Vienna, April 3-4, 1990 , an d - a t "New Technologies , Institutiona l Changes an d Working Life: Research Issue s for th e 1990's " organized by The Norwegian Council for Information Technology Policy an d Norwegian Computer Society i n Oslo, June 20-21, 1990 . Th e articl e has als o bee n presente d a t seminar s at th e Departmen t o f Economics , Stanfor d University an d at Crown College, Universit y of California, Santa Cruz. I am very grateful for comments received from participants at these conferences and seminars. I have also greatly benefitted from comment s by Mark Elam, Hans Glimell, Maureen McKelve y - al l members of the ADD-TECH Researc h Programme . The comments fro m Te d Bradshaw , Harve y Brooks , Björ n Elsässer , Lennar t Erixon , Christopher Freeman , Joha n Hedren, Beng t Jönsson , Ken t Lindkvist , Fredrik Wes tander and two anonymous commentators hav e also been ver y useful . [2] Th e term s "technologica l change " and "technica l change " wil l her e b e use d inter changeably. I t mus t also b e mentione d tha t I dea l onl y with technica l chang e an d technology polic y prope r i n thi s chapter . Th e analysi s of organizationa l and man agerial innovation s as well a s education an d training - an d related policie s - are not addresse d here . Thi s does no t impl y tha t I consider the m unimportant ! On th e contrary, they may be more important than technological changes proper for working conditions, productivity, competitiveness, employment and life as a whole. They are also ofte n ver y intimatel y relate d t o technologica l change s an d a preconditio n fo r the implementatio n of technologica l changes . I n Edquis t (1992), I analyz e organizational innovations , i.e. th e emergenc e an d diffusio n o f ne w organizationa l form s in workin g lif e an d i n othe r spheres , an d th e implication s thereof fo r productivity and employment . Organizational and manageria l matter s as wel l a s educatio n an d training are also dealt with i n other chapters include d in this book. [3] Th e issue of who -or whic h institution - i s formulating and implementing technology policies wil l be dealt wit h only in passing. Institutiona l aspects o f technical change are placed mor e in focus in Edquist/Lundvall (1991), where the Danish and Swedis h National Systems of Innovation are analyzed. [4] Technolog y is , o f course immensel y important also fo r warfare , but thi s paper wil l deal mainly with civilian technologies. [5] I n a marke t economy , propert y right s are created o n th e basi s o f inventive activity . To the exten t that this i s successful , there i s a underutilizatio n of th e information. There ar e basically three means through which firms can appropriate returns to their technical innovations: - throug h the patent systems , - throug h secrecy, and - throug h exploiting a head start . [6] I will concentrate on intervention in the production sector, as opposed to, for example, infrastructural intervention .

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[7] Th e wor d "all " i s emphasized becaus e technolog y polic y i s often use d interchange ably wit h R&D policy . Th e argument s fo r broadenin g th e perspectiv e wil l b e pre sented i n section 6 . [8] Thi s i s actually an indication that this policy field is an 'underdeveloped ' on e - a n issue to be dicussed later . [9] Thes e are not even described i n an integrated an d holistic manner, for most countrie s and various parts of the policy as a whole are normally formulated and implemente d by different agencies . Thi s means that the right hand may not know what the left on e is doing . [10] Thi s happene d - a s a comparison - wit h energy polic y in Sweden i n the 1970s . [11] Ther e are, however, exception s t o this rule. In Sweden an d some othe r countries, the degree of state interventio n in the process of technological chang e is quite limited and not increasing. But this has not always been th e case. In the late 1960 s and early 1970s, ther e wa s a drive fo r a mor e activ e industrial and technolog y policy , which included th e creation o f the Ministry of Industrie s and of STU (Th e Swedis h Boar d for Technica l Change) (Glimel l 1986:108-112) . Later i n the 1970s this developed during th e right-wing government 1976-8 2 - int o excessiv e stat e suppor t t o ailing industries (shipyard , textile, etc.) . Th e negativ e attitud e o f th e Socia l Democrati c government (unti l 1991 ) t o offensiv e future-oriente d intervention, for example , t o change th e structur e o f industr y i n a hi-tec h direction , ma y b e a consequenc e o f these negativ e experiences. Th e ne w centre-right governmen t seem s t o be even les s interested i n pursuing an offensive technology policy. There is, however, a tremendous difference betwee n stat e suppor t t o activities that will di e anywa y an d t o those tha t are i n th e proces s o f bein g born ! I f th e ne w one s ar e R&D-intensive , the y ca n b e expected t o give rise t o external economies and to create competitive advantage s i n a dynamic manner. In another paper (Edquist/McKelve y 1992) , we have also show n that productivit y growth i s higher fo r productio n o f R&D-intensiv e goods tha n fo r other goods . [12] Thi s agenc y woul d b e a civilia n counterpar t t o th e Defenc e Advance d Researc h Projects Agenc y (DARPA) , whic h support s technolog y developmen t considere d t o be critical for defence . [13] However , th e hea d o f DARPA wa s fired in 1990 , and the reaso n wa s said t o be that he talke d to o muc h abou t civilia n technolog y policy . Accordingly , ther e wa s stil l resistance withi n the administration to civilian technology polic y at this time. [14] However , othe r objectives ar e certainly possible, as we shall see in section 4 . [15] I n the cas e o f imperfec t marke t competitio n ther e may , on th e othe r han d be over investment i n R& D becaus e o f duplicatio n o f effort s - a s Dasgupt a an d Stiglitz (1980) have shown. From a somewhat differen t angle , Richard Nelson (1987) argue s that technical change is an inherently inefficient proces s characterized by uncertainty, duplication and waste . [16] Thi s has been expressed in the following way: "The theor y of market failure suggest s that whatever is being spent by firms on industrial R&D i s not enough; it says nothing about wha t is enough" (MacDonald 1986:271) . [17] On e could eve n argu e tha t th e market failur e theor y - summarize d abov e - ha s contributed t o a ver y narrow-minde d kin d o f stat e interventio n in th e proces s o f technological change : direc t (o r explicit ) technolog y polic y ha s tende d t o b e th e same a s R& D policy . Anothe r forc e leadin g i n th e sam e directio n i s th e so-calle d

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linear mode l o f technological chang e - whic h stresse s linea r causalit y from basi c research t o applie d researc h t o developmen t work , innovatio n and diffusion . (Se e MacDonald 198 6 fo r simila r arguments.) Inheren t i n thi s mode l i s tha t resource s should be allocated t o basic researc h - i n order t o produce economi c growt h at the very en d o f th e chain . Other part s o f th e innovatio n process ten d t o b e neglected . Setting technology polic y equal to R&D policy mean s that a supply-push perspectiv e is heavil y dominant over a demand-pul l perspective. A s w e shal l se e i n sectio n 6 there are many other importan t dimensions of technology policy . [ 18] A s we saw, it can even be argued to have led to a narrow-minded view of technology policy. [19] A t th e presen t immatur e stag e o f theor y development , i t woul d b e to o ambitious to tr y t o formulat e holisti c theorie s o f technologica l change . I t i s wise r t o tr y t o formulate partial theorie s fo r different groups of technologies (proces s technologies , product technologies, interactiv e technologies, etc.) and for each stag e i n the proces s of technical chang e separately . [20] Thi s is a strong argument for supporting theoretical work in the field o f determinants of technological chang e eve n from th e policy point of view. [21 ] Indirec t (or implicit) technology policie s are , o f course, formulate d with some othe r objective i n mind, and the effec t o n technological change is simply a spin-off. [22] However , i f the ambition is not to overtake, bu t only to catch up , imitation may be a viable mode. This i s because o f the fact that it may b e advantageous to let someon e else make the mistakes . In addition, imitation can be successfu l if the context in the imitating country happens t o b e mor e favourabl e to a positive outcom e tha n i n the country imitated. However, thi s is then more b y chance than by design. [23] Fo r smal l countries , i t i s naturall y easie r t o influenc e th e us e o f technolog y tha n technological developmen t pe r se , simply because mos t technologies ar e develope d abroad. Whethe r thi s is successful or not is another matter. This issu e will be furthe r discussed i n section 6. [24] I concentrate o n th e historica l experienc e o f Japan, an d th e lates t decade o r s o will not be covered a t all. [25] Consequently , the policy wa s not formulated by economists, bu t by bureaucrats and engineers a t th e Ministr y of Trad e an d Industr y (MITI). There wa s eve n a conflic t between th e professional economists at the Central Bank and the bureaucrats in MITI. In the early 1950 s th e Central Ban k was an obstacle t o the process outlined above , by denyin g loan s an d foreig n exchang e licenses . Howeve r MIT I wo n th e struggl e during the course o f the 1950s . [26] Referrin g to a Japanes e calle d Amaya , Prestowit z writes : " A ke y objectiv e i n an y economy .. . i s t o creat e a n industr y tha t produce s technologicall y sophisticate d products with high income elasticit y ... an d a rapid growth rat e . . . . That objective , according t o Amaya and most other Japanese observers , canno t be achieved withou t government intervention " (Prestowit z 1988:128) . [27] Thi s is so in spite of the fact that it is unclear whether these criteria were formulated ex ante or i f they hav e late r bee n derive d fro m th e actua l selectio n o f product s an d industries - whic h was then perhaps done in an intuitive and heuristic manner. On this latter issue, Allen writes: "it is debatable ho w far those principle s were consciously applied ab initio, and how far they have been subsequently inferred from the decisions and conduct of the industrialists and the bureaucracy" (Allen 1981:71) .

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128] Thi s is , for exampl e argue d b y Okimoto (1989:106) . The distinctio n between tech nology pus h an d deman d pul l wil l b e furthe r adresse d i n sectio n 6 . However , t o avoid misinterpretations , it must b e mentione d alread y her e tha t policy instruments intended to influenc e th e processes o f absorption an d diffusio n a t foreign-develope d technologies ca n b e considere d t o b e supply-sid e measure s fro m a Japanes e poin t of view . Althoug h thi s constitute s a demand fo r technologie s develope d i n othe r countries, the polic y objectiv e i s to increas e th e supply o f technologies availabl e i n Japan. [29] Productio n technologies or process technologies are used in the process of production, to produc e good s an d services . Produc t technologies , o n th e other hand , ar e or ar e included i n products (good s and services) . Thes e term s ar e defined more precisel y in, fo r example , Edquis t (1992) . I t woul d b e interestin g to investigat e i n detai l t o what exten t the introductio n of ne w produc t technologie s wa s give n priority in th e Japanese polic y o r whethe r proces s technolog y an d wor k organizatio n wer e mor e important objects o f state intervention . (This is, of course, something different fro m their relative importance i n the economy.) [30] Now , of course, Japa n has taken the global lea d with regard t o certain technologies which mean s goin g int o development o f technologies, e.g. basi c research , invention and innovation. [31 ] O f course, the degree of intervention and regulation has diminished during the 1980s . [32] Th e NM P ha s been evaluate d in Wennerberg (1989) . [33] Th e initia l stage s o f th e I T programm e hav e bee n evaluate d i n Arnol d an d Gu y (1989). [341 Thi s wa s not possible i n a later programme whic h was starting to be implemented in the Autumn of 1990 . It was intended to support technology renewal in the engineering industry an d onl y smal l an d medium-size d firm s wer e eligibl e t o receiv e support . However, this programme wa s terminated in the Autumn of 1991 , after the formation of the centre-right government i n Sweden . [35] A s wil l b e indicate d in sectio n 3.4 , i t seem s natura l for Swedis h firm s t o us e their R&D resource s fo r improvemen t o f thei r traditiona l product s an d processes . An d they ar e reluctan t to g o fo r ne w products . However , i f the y hav e a stron g positio n in variou s state agencies, the y also ten d to influenc e stat e technology policie s i n the same 'conservative ' direction . Thereby stat e policies may duplicate or substitute for private efforts, rather than serve as complement to them. (As will be argued in section 5, thi s is not a good reaso n fo r state intervention.) [36] Fact s an d figure s ar e foun d i n Edquist (1989a) (in Swedish ) and , t o som e exten t in Edquist and Lundvall (1991) (in English). [37] Productio n an d produc t technologie s wer e define d i n footnot e 2 9 i n sectio n 3.2 . Here i t could b e adde d tha t product technolog y i s a question of what i s produced . An empirical measure of "diffusion o f product technology " i s simply which types of products are produced - fo r example the%age of R&D intensive products. Productio n technology is a question of how things are produced. Som e product technologie s ar e obviously simultaneously - or rather, in a later stage - productio n technologies; when a machin e i s produced i t i s a produc t technolog y an d whe n i t i s used, the n i t i s a process technology . A product technology whic h is not intended for final consumption is, in fact, also a process technology. (Se e als o Edquist/McKelve y 1992: 9 and 13. )

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[38] Eleve n factor s whic h may partiall y explain thi s picture wer e discusse d i n (Edquist 1989c: 10-11). It is very unlikely that public technology policy has been an important determinant behin d th e hig h degre e o f diffusio n i n Swede n a s regard s productio n technologies i n the engineering industry . [39] Muc h the same picture is given if we look at the proportion of production and exports of all manufacturin g products emanatin g from high-R&D-products . I n Edquist and McKelvey (1992), we provide a much more detailed analysis of the Rand intensity of output (product technology) in the Swedish engineering industry as well as in industry as a whole . I n a n attemp t t o causall y explain th e lo w leve l o f produc t technolog y in Swede n th e crucia l thing is to understand why firms in other countries do g o fo r new (R&D-intensive) products, bu t Swedish firm s d o not . This i s also attempte d i n Edquist and McKelvey (1992). [40] Ther e ar e severa l reason s wh y i t i s importan t fo r a countr y t o b e presen t i n th e R&D-intensive sector s an d produc t groups . Firstly , ther e i s a correlatio n betwee n R&D-intensive products an d growth products . Secondly , i f OECD countrie s do not have a considerabl e proportio n o f thei r productio n i n R&D-intensiv e (high-tech , knowledge intensive) industries, they will soon find themselves subject to fierce price competition fro m developin g countries and NI C countries . Thirdly, R&D-intensive sectors ar e associate d wit h external economies, se e Edquis t and McKelve y (1992 ) for a n elaboration of this. [41] However , a certai n amount of conceptua l wor k i s a preconditio n fo r th e empirical analysis. I t shoul d als o be mentione d tha t a "problem " identifie d ca n b e th e resul t of th e operatio n o f th e marke t mechanis m a s wel l a s a resul t o f previou s stat e intervention. [42] A n analogy with the field of economic policie s may b e illuminating. Policy-makers in th e fiel d o f fisca l an d monetar y policie s nee d indicator s abou t th e balanc e o f payments, employment, inflation, etc. i n order to be able to know when to intervene. A basi s o f empirica l indicator s i s neede d als o i n th e fiel d o f technolog y policy . However, suc h indicators are much less developed i n the field of technology policie s than with regard t o economic policies . [43] Th e causa l analysi s ma y als o revea l tha t stat e interventio n can no t solv e th e prob lem identifie d through the symptom-describin g analysis . In such a case, the correct decision i s of course non-intervention. [44] Technolog y polic y is, however, certainly not the only means to achieve this. [45] However , th e referendu m decisio n ha s increasingl y starte d t o b e questioned ; an d there is in the early 1990 s an intense debate over the issue . [46] O f course technology policy-makin g is also a part of the political process when it is not a matter discussed b y the general public. [47] I n the West, the pattern was somewhat different, at least in the 1970s . On the Swedish scene ST U had three task s o r roles i n the first years o f the 1970s : an industrial role, a research-supporting rol e and a sectorially oriented one. The third one was new and meant tha t ST U wa s suppose d t o activel y cooperate wit h stat e agencie s an d with sectorial R& D agencies i n certain sectors of society, lik e transportation, health care, environmental issues , etc . Th e intentio n was t o direc t technica l R& D int o certai n priority area s an d a t th e sam e tim e induc e demand whic h could lea d t o advance d technologies and new products. During several years towards the mid-1970s, different strategies coexiste d withi n STU. However , the more sociall y oriented one was never

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dominant an d graduall y faded awa y aroun d th e mid-1970 s (Glimel l 1986:109-112 , 1989:95). [48] I t is important to keep in mind that the objectives are not necessarily economic. The y may also be of a social, environmental, ethical or military character. [49] Th e reaso n fo r the unfulfillmen t o f the socia l objective s ma y als o be previou s stat e intervention - i n which case this political failure mus t be balanced. [50] Tha t a problem has to be carefully identifie d before intervention occurs is, as we saw in sectio n 3.4 , no t a banal proposition . [51] I t would, for example, certainly not hav e been possibl e t o identif y th e fac t tha t the low-R&D character o f Swedish product technolog y i s a severe proble m exclusively on th e basi s of theoretica l analysis. Neither would it have been possibl e t o say that the low-tech character of process technology in the engineering industry is a problem in th e USA and the UK (see sectio n 3.4.). [52] I t ma y als o b e mentione d tha t th e theor y o f marke t failur e presuppose s tha t th e objective o f technology policy is maximum (economic) welfar e or Pareto efficiency , i.e. the policy objective i s implicit in the theory. [53] Thi s mean s that I address "problems " which the market does not solve automatically and "stat e intervention " at th e sam e pragmati c common-sens e level . This solve s a problem of imbalance from which standard economics suffers. Economist s talk about "market failures " within the framework of a formal model but "government failures " in an ad hoc way, unrelated to any general theory. This makes systematic comparisons difficult. Charle s Wolf has recently tried to solve the problem i n the way opposite t o what I proposed abov e - b y attempting to develop a general theor y o f government (non-market) failur e (Wol f 1988) . However , h e faile d t o d o s o i n a coheren t an d consistent manner (Sharkey 1990) . [54] Th e following discussion is based upon Edquist (I989b). [55] I t is assumed in this article that minor innovations and adaptations are part and parcel of diffusion. Henc e margina l innovations are distinguished from radical innovations and the development of generic technologies . [56] Referrin g back t o the case of the Swedish engineering industr y we saw in section 3. 4 that the diffusion o f new production technologies is very rapid while the diffusion o f R&D-intensive product technologies i s very problematic. [57] Th e technica l development o f system s withi n th e defence firms - i n Sweden , fo r example, SAA B (fighter planes) and Bofors (guns, missiles) - ar e often also directly subsidized by the state . [58] I n addition, the direct cost for the public sector of using such an instrument is zero. [59] Thi s bias can, at least partly, be traced bac k to the market failure theory and the linear view of technological change (see sectio n 3.1) . [60] Fo r example , th e Swedis h restriction s wit h regar d t o internationa l currency flow s were gradually lifted i n the late 1980s . [61] T o provide support in the field of technology development to the large - increasingly footloose - 'Swedish ' firms may also b e don e i n vain , sinc e the y ma y move th e exploitation - an d thereby economi c benefit s - o f the R&D results outside Sweden . In this sense, state support to R&D infrastructures or to small and medium-sized firms seems to be better, since they are still more closely integrated in the national economy. However, large multinational firms get a lot of state support in other countries as well as fro m th e Europea n level . This ma y induc e the Swedis h stat e t o d o th e sam e i n

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order t o giv e these firm s incentive s to kee p thei r R&D activitie s in Sweden . (On e country whic h has bee n involve d in direct negotiations with firms on suc h issues is Canada.)

References Allen, G.C. (1981 ) Industrial Policy and Innovatio n in Japan, in : C. Carter (ed. ) Industrial Policy and Innovation, London : Heinemann , 68-87. Andersson, F . (1990) Th e International Diffusion o f Ne w Chemical Entities - A Crossnational Study o f th e Determinants o f Differences i n Drug Lag, Linköping : Linköping Studies in Arts and Scienc e 51. Arnold, G. , K. Guy (1989 ) Evaluatio n of th e IT 4 Programme - Phas e I , Repor t t o the Delegation of the Swedish Government, Stockholm, 8 September 1989 . Arrow, K. (1962) Economic Welfare and the Allocation of Resources fo r Invention, in: The Rate and Direction of Inventive Activity, Princeton: Princeton University Press, 164-181 . Dasgupta, P , J. Stiglit z (1980) Industria l Structur e and th e Natur e of Innovativ e Activity, in: Th e Economic Journal 90 : 266-293. Edquist, C. (1988) Technology Policy - Conceptual Remarks an d European Experiences, Paper presente d a t th e Conferenc e o n "Technolog y Polic y in th e Americas" , Stanfor d University, California . Edquist, C. (1989a) Utvärdering av statligt stöd til l verkstadsindustriell tekni k (Evaluation of State Support to Engineering Technology i n Sweden), Tema T. Report 22, Linköping: Department of Technology an d Social Change, Universit y of Linköping. Edquist, C. (1989b) Teknis k förändring och teknikpolitik, in: Energin, makten ochframliden - samhällsvetenskapliga perspektiv p a teknisk förändring R16 , Stockholm: Statens Energiverk. Edquist, C. (1989c) The Real m of Freedom i n Modern Times? New Technology i n Theory and Practice, Inaugura l Lecture, Tema T Report 18 , Linköping: Department of Technology an d Social Change , University of Linköping. Edquist, C. (1992) Technological and Organizational Innovations, Working Paper No. 233, Geneva: ILO. Edquist, C., H . Glimell (1989) Swedish Frontiers o f Change - A Guide t o the Impact o f New Technologies, Work Designs an d Management Practices, Repor t prepare d t o th e Directorate fo r Social Affairs, Manpower, and Education, Paris: OECD. (To be published in OEC D (1993 ) Technological Change a s a Social Process: Society, Enterprises an d the Individual, Paris : OECD. ) Edquist, C. , S . Jacobsso n (1988 ) Flexible Automation - Th e Global Diffusion o f New Technologies i n the Engineering Industry, Oxford : Blackwell. Edquist, C., B - . Lundvall (1991 ) Comparing th e Danis h and Swedis h System s o f Innovation, Tem a T . Working Paper 77 , Linköping : Department o f Technolog y an d Socia l Change, University of Linköping. (Published in: R.R. Nelson (ed.) (1993) National Systems o f Innovation: A Comparative Study, Oxford : Oxford University Press, 265-298.) Edquist, C., M . McKelve y (1992 ) Th e Diffusio n o f New Produc t Technologie s an d Pro ductivity Growt h in Swedish Industry, Consortium o n Competitiveness & Cooperatio n (CCC) Working Paper No. 91-15, Berkeley: Center for Research i n Management, University o f California. (In Swedish i t has been publishe d in Forskning, Teknikspridning oc h

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Produktivitet, Expertrappor t numme r 1 0 til l Produktivitetsdelegationen . The Swedis h title was "Högteknologiska produkter oc h produktivite t i svensk industri".) Fransman, M. (1985) Conceptualizing Technical Chang e i n the Third World i n the 1980s : An Interpretiv e Survey, in: Journal o f Development Studies October: 34-76. Freeman, C . (1987) Technology Policy and Economic Performance - Lessons from Japan, London: Pinter. Glimell, H . (1986 ) Hu r ka n teknis k forsknin g päverka s a v statli g forskningspolitik ? Sjuttiotalets strävande n at t ök a Sektors - oc h samhällsintressena s inflytand e ove r de n tekniska utvecklingen, in Tekniska Museets ärsbok 1986-Daedalus Vol. 34, No. 1 , 17-32 . Glimell, H . (1988) Den svenska vage n til l trängr e kretsa r - framväxte n av del nationella mikroelektronikprogrammet, in : H . Glimel l (ed. ) Industriförnyelse i Norden - (80talets programsatsningar pä mikroelektronik, Roskilde: Forlage t Samfundsökonom i og Planläggning, 74-93. Glimell, H . (1989) Ätererövr a datapolitike n - E n rapport o m state n oc h informationsteknologin unde r fyr a decennier , Tem a T Rappor t 20 , Linköping : Graduate Schoo l o f Technology an d Social Change , Universit y of Linköping. MacDonald, S . (1986 ) Theoreticall y Sound : Practicall y Useless? Governmen t Grants fo r Industrial R& D i n Australia, in: Research Policy 15 : 20-37. McKelvey, M . (1989 ) European Economic Community: Research Policy, Political Ideology an d Decision-making Process, Master' s thesis , Lund : Researc h Polic y Institute , University of Lund. Nelson, R.R . (1987 ) Understanding Technical Change a s a n Evolutionary Process, Amsterdam: Elsevier . Nelson, R.R . (ed.) (1993 ) National Systems o f Innovation: A comparative Study, Oxford : Oxford Universit y Press . Odagiri, H. , A. Goto (1990) National Systems Supportin g Technical Advance in Industry: Japan, pape r presente d a t th e conferenc e o n "Nationa l System s Supportin g Technical Advance i n Industry " at Stanfor d University . (Published i n R.R.Nelso n (ed. ) (1993) , 76-114.) OECD (1971 ) Science, Growth an d Society - a New Perspective, Repor t o f the Secretary General's A d Hoc Group of New Concepts o f Science Policy , Paris: OECD . Okimoto, D.I . (1989) Between MITl an d the Market - Japanese Industrial Policy for High Technology, Stanford : Stanford Universit y Press. OTA (Offic e o f Technolog y Assessment ) 1990 : Makin g Thing s Bette r - Competin g i n Manufacturing, Washington, D.C.: Congres s o f the United States, Offic e o f Technolog y Assessment, Februar y 1990 . Prestowitz, C. V. jr (1988) Trading Places - Ho w America Allowed Japan t o Take the Lead, Tokyo: Tuttle. Sharkey, W.W . (1990 ) Boo k Revie w (o f Market s o r Governments : Choosin g betwee n Imperfect Alternative s by C. Wolf), in: Managerial an d Decision Economics (11): 207 210. Shinohara, M . (1980 ) Industrial Growth, Trade an d Dynamic Patterns i n th e Japanese Economy, Tokyo: Universit y of Tokyo Press. Wennerberg, S . (1989 ) Nationell a Mikroelektronikprogramme t (NMP ) oc h Industriel l Utveckling (Utvärderingsrapport), unpublished paper. Wolf, C . jr. (1988 ) Markets o r Governments: Choosing between Imperfect Alternatives, Cambridge, MA : MIT .

Promote or Regulate: Th e Dilemma of Innovatio n Policy Ernest Braun

1 Introductio n Technological innovatio n is regarde d a s on e o f th e mai n driving forces behin d economic growth , an d a s on e o f th e mai n determinant s o f competitivenes s o f manufacturing firm s an d o f nations . A s government s wis h t o encourag e bot h growth and competitiveness, the y regard it as their duty to do all they can to foster technological innovation . Yet the days whe n unrestraine d growth wa s viewe d a s unconditionally desirabl e ar e lon g gone . Althoug h many stil l believ e tha t ther e is muc h scop e fo r furthe r growth , no t man y believ e tha t growt h i n profligat e material consumptio n can g o unbridle d fo r ever . Thu s on e hor n o f th e dilemma of innovatio n policy i s th e uneas e create d b y th e suspicio n tha t growth , thoug h desirable fo r many reasons, i s not a long-term option for humankind. Technology ha s lon g bee n recognize d no t onl y a s th e moto r o f economi c growth an d th e ver y essenc e o f huma n society , bu t als o a s a sourc e o f danger . Technology ca n b e th e caus e o f hazard s t o lif e an d limb , t o health , an d t o th e natural environment. It has long been recognize d tha t the development and use of technology canno t be left unregulate d and must , like so much human activity, be subject t o rule s an d regulations . On th e othe r hand , i t is obvious that rule s he m in th e fre e developmen t o f technology an d thu s might slow i t down. The secon d horn o f th e dilemm a o f innovatio n polic y i s thus th e nee d t o create rule s which govern th e developmen t an d us e o f technology , i n th e ful l knowledg e tha t this limits freedom an d can slo w down technologica l innovation. Technology polic y has to tread th e middle path and must find suitable compro mises betwee n enhancin g technologica l innovatio n and controllin g the danger s created by rapid expansion in the use of technology .

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2 Technolog y Policy and Technological Innovation 2.1 Th e Scope of Technology Policy In th e broades t sense , technolog y polic y include s all polic y measure s which , in some way, affect the development and use of technology. As technology permeate s all spheres of human life, this broadest definitio n is somewhat vacuous - i t includes everything and thus defines nothing. We must narrow the definition of technology policy t o includ e onl y thos e policie s whic h deliberatel y se t ou t t o affec t th e development and use of technology. We regard policie s as intentions to influence some development , whil e policy measure s ar e taken to carry ou t these intentions. Technology policie s an d polic y measure s ar e al l thos e specificall y designed t o influence technology fo r some goa l or purpose. Som e policies do, of course, hav e mixed objectives. We include such policies, if at least one of their objectives is to influence technology . The scop e of the wor d polic y itsel f need s t o be qualified her e t o refer mainly to public policies, i.e . policy measures taken by government or quasi-government bodies a t all levels . Thus policie s pursue d by industria l firms will be referre d t o only exceptionally. We use a rather narro w definitio n o f technology , i.e . technology ar e artefact s designed and manufactured for specific human purposes and the software required for thei r operation . Thus , a telecommunicatio n syste m i s her e regarde d a s a technology an d include s al l it s multifariou s software ; whil e a socia l securit y system i s no t a technology , thoug h i t use s technologies , e.g . computers , i n th e pursuit of its activities. Our definition concentrates o n artefacts, no t on institutions or organization. There are two main types of technology: that used for the production of good s and service s (productio n technology) ; an d tha t use d directl y a s item s o f con sumption (consumptio n technology). Th e divisio n is b y n o mean s neat , as , fo r example, a n electric dril l ma y b e use d eithe r by a do i t yourself (D.I.Y. ) enthusiast o r a worke r i n a manufacturin g plant. In on e case , i t i s a n ite m o f capita l equipment, in the other case an item of final consumption. Generally speaking, technology policy in the public domain pursues two broad objectives: - I t attempt s t o support , enhanc e an d accelerat e th e developmen t an d use of technology, wit h th e ultimat e goa l o f strengthenin g th e economy . I n som e cases, the strengthening of the political and military power of the state may be a further, or even sole, ai m of technology policy . There are strong link s between Researc h an d Development (R&D) , a s one of th e mai n sources o f technologica l innovation , and technology . Hence , w e expect a strong up-stream linkage between R& D policy and technology policy. On the other hand, there are strong down-stream links between technology pol-

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icy and industria l policy, a s industry is the producer o f technological product s and the user of production technologies . - Technolog y polic y attempts to regulate the use and development of technology in such ways as to eliminate, or minimize, risks posed by technology to health, safety, th e socia l fabric , and th e natura l environment. Technology polic y als o regulates th e use of technology i n those cases where it s unregulated use would cause chaos and render th e technology inoperable , e.g . i n transport systems . The discussio n o f possibl e conflict s or synergie s betwee n th e tw o fundamental aims of technology polic y form s th e substance of this chapter. The way s t o influenc e technolog y b y polic y measure s ar e man y an d varie d (Braun 1984) . In the main, possible direct influence s are: - financial , e.g . direc t subsidie s o r tax incentives fo r producing technologica l innovations o r fo r pioneerin g us e o f ne w technologies ; ta x allowance s fo r investment i n production machinery , subsidies for training courses, etc. Simi larly, financial incentive s or disincentives may be used to achieve reductions in levels of pollution, e.g. b y charging for effluent o r giving grants for introducing filters; - legislative , e.g. regulations, such as on fire safety or on emission levels ; patent laws; requirements, such as for testing of drugs or vehicles; or prohibitions; - publi c procurement , bot h civi l an d military, e.g. purchase s o f computers fo r departments o f government o r the procurement of weapons systems . Th e pro vision o f a technica l infrastructur e might b e include d here , a s government s see t o it , directl y o r indirectly , that roads , railways , canals , communication s systems, etc . ar e built , operated, maintaine d and modernized . Thi s require s a great dea l o f procuremen t eithe r b y publi c bodies o r b y privat e institutions under public supervision; - information , including measures suc h a s organizational arrangements fo r industrial collaboration , the operatio n o f public R&D institutions , standards in stitutions, technological trainin g and education, technica l libraries, data bank s and advisory services . The abov e categorie s ar e no t intende d t o conve y th e impressio n o f watertigh t compartments. An y polic y o f an y substanc e i s likel y to consis t o f man y relate d measures, an d th e categorie s appl y t o singl e polic y measures , rathe r tha n t o policies. Indeed, many measures cannot stand on their own, e.g. legal requirements may necessitat e organizationa l an d institutional change. In summary, we find that technology polic y is intended to influence technolog y and cannot b e easil y isolate d eithe r fro m R& D polic y o r fro m industria l policy. Even som e aspect s o f educatio n policy , an d man y concern s o f infrastructural and militar y policies interac t wit h technolog y policy . The tw o mai n thrust s of technology polic y are the support of technology and the regulation of technology. The forme r stem s mainl y fro m th e desir e t o strengthe n th e nationa l economy ,

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while the latter i s mainly necessary i n order to reduce healt h an d environmental hazards cause d b y the use of technology. The mai n thrus t o f supportiv e policie s i s aime d a t enhancin g technologica l innovation. The reasons fo r this are twofold: first, technological innovatio n is believed to lead to economic growt h and is regarded a s necessary t o avoid economi c stagnation an d maintai n international industria l competitiveness (Freema n e t al. 1982; Stonema n 1983 ; Coomb s e t al . 1987) . Secondly , i t is very muc h easie r t o influence ne w technologies b y polic y measure s (Collingridg e 1980) . Ol d estab lished technologie s rarel y requir e stat e intervention , except whe n the y ru n int o trouble an d need to innovate, o r when they come to be regarded as hazardous and need t o be regulated . Technological innovatio n is the prime targe t o f supportiv e technology policies, much as young plants are the prime concern of the gardener' s supportive and regulatory measures . 2.2 Definitio n o f Technological Innovatio n We define technological innovatio n as a ne w o r substantiall y improved produc t or process used or purchased o n a commercial basis . This definition require s some explanation . First, we do deliberately distinguish between innovatio n an d invention . An inventio n is merel y a n idea , a drawing, possibly a prototype. The invention is probably, though not necessarily, the subject of a patent. At the stage of the invention no product on a commercially usable scal e exists, thoug h possibly the prototype, o r prototypes, ma y be used experimentally. The grea t majorit y o f invention s neve r lea d t o commerciall y use d product s o r processes, and thus play no significant economic role . The road fro m invention to innovation is indeed a n arduous one. I t requires a great dea l o f effort, mone y and tenacity, and ofte n end s in failure. We distinguish essentially between three types of innovation. The most clear-cut is the produc t innovation . A ne w o r substantiall y altered product , i.e . a produc t with som e entirel y ne w feature s an d no t merel y som e re-stylin g or re-design , which is newly offered for sale o n the market, is defined as a product innovation. Strictly speaking , th e produc t remain s a n innovatio n only durin g th e ver y first stages of being marketed , thoug h the concepts o f new, newly on the market, an d even marke t itself o r commercial scale , ar e all slightly blurred. The secon d typ e o f innovatio n i s the proces s innovation . I n th e strictes t an d simplest sens e i t mean s a ne w wa y o f producin g something , use d fo r th e firs t time i n commercial production , i.e . no t merel y o n a n experimenta l scale . If , fo r example, insuli n i s produce d b y method s o f geneti c engineerin g instea d o f b y extraction fro m pigs ' pancreas, w e have a clear case of a process innovation . The product, in this particular case, remains essentially unchanged. Unfortunatel y for those wh o lov e clearcu t definitions , very ofte n proces s an d produc t innovations go hand in hand, a new product often requirin g a new process for its manufacture.

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The thir d typ e o f innovation , commonl y subsume d unde r th e ter m proces s innovation, is here termed manufacturin g innovation (Bessant/Grunt 1985) . This is defined as the introduction of significant change s i n the manufacturing process new t o a firm . Thu s w e recogniz e th e innovativ e activitie s o f manufacturing industry i n improving their manufacturing methods, eve n i f what they introduc e is neithe r a worl d novelty , no r a n entirel y ne w process . Take , fo r example , th e introduction, i n the early days o f automation , of CN C machiner y or robots into an engineerin g fir m whic h had neve r use d suc h machine s before . Althoug h the machines were not entirely new to the world, they were of fairly recen t origin and required a good deal of innovative activity within the plant using such equipment for the first time. Another example might be the change from batch production to continuous production in, say, a brewery. The process of brewing remains the same and the idea is not entirely novel; nevertheless i t requires a major reorganization, retraining, and rethinking on the part of management an d workforce . The reaso n we ar e dealin g wit h thi s typ e o f innovatio n a t suc h lengt h i s that , althoug h i t is ofte n regarde d simpl y a s th e diffusio n o f proces s innovations , i t i s subjec t to a grea t dea l o f suppor t an d attentio n by policy-makers . I t i s manufacturing innovation, or diffusion o f process innovations, which, when all is said and done , is the major determinant of the use of manufacturing technolog y an d of industrial competitiveness. Indeed, i t i s alway s th e fina l stag e o f th e innovatio n process, th e proces s o f diffusion o f the innovatio n through the economy , whic h determines th e ultimate fate o f th e innovation , and thu s it s economi c significanc e (Landau/Rosenberg 1986). 2.3 Th e Role of Technological Innovatio n i n the Economy The two main roles of technological innovation are as follows: first, to counteract market saturation , an d thu s stagnation , b y offerin g eve r ne w products , an d t o cause economi c growt h by offering a n ever expanding range o f goods. Secondly, technological innovation is a main weapon i n the armoury for competitive battles. Only thos e manufacturer s whose productio n technolog y i s constantl y renewe d to ensur e competitiveness , an d whos e good s ar e u p t o th e lates t standards , wil l thrive, or even survive. The market for many types of technological products tend s to reach saturation and the product can then essentially be sold a s replacements for worn-out devices only. If, however, a substantially improved product comes on the market to replace the on e fo r whic h th e marke t i s saturated , a ne w majo r wav e o f purchase s ca n begin. A classical exampl e i s the saturation of the market for black and white TV sets and the ne w wave of purchases fo r colour TV sets . The industr y now hope s that it s fortunes wil l reviv e again wit h the likel y introduction of high-definitio n TV, and thus a new cycle of investment will start. In some products, i t is sufficien t

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to make smal l stylisti c changes t o re-kindle flagging markets. This holds mainly for clothing and other items strongly subject to fashion. Obviously, manufacturers always attempt t o ge t awa y with such smal l changes an d wit h so-called built-i n obsolescence; bu t i n man y cases , th e onl y remed y t o flaggin g market s i s tru e innovation. Technological innovatio n extends the range of goods availabl e on the market, and thus, if successful, increases tota l demand. As long as the economy functions sufficiently wel l to ensure tha t customers willin g to buy the ne w goods are als o able to do so, i.e. that purchasing power expands in step with an expanding range of goods, economic growt h will ensue. This argument is independent of whether we believe that new products merely satisfy existin g needs, o r whether we believe that new needs are created by new products, or whether we think that needs and the offer o f their satisfaction can, i n most cases, not be meaningfull y separated . Th e only condition that must be fulfilled i s that the new product must find buyers, i.e. it must succeed on the market. Otherwise, the investment embodied in the innovation will have to be written off and the total economic effec t wil l be negative . Major successfu l innovation s tend t o com e i n clusters : on e innovatio n leading t o anothe r and thu s to a whol e technologica l system . Microelectronic s i s a very goo d exampl e o f this . Th e integrate d circui t require d a grea t dea l o f ne w production technolog y t o be produced o n a large scal e a t a reasonable pric e and this requiremen t le d t o a whol e rang e o f ne w productio n equipment . Th e inte grated circui t found a very large scal e applicatio n in computers o f all kinds, as it improved their performance, an d particularly their price-performance ratio , quite dramatically. The success o f the computer led to many associated innovations , as for exampl e a range o f printers, computer numericall y controlled machin e tools, new telephone exchanges , an d thousands of other innovations of greater or lesse r importance. Clearly th e economic significanc e of this cluster of related innovation s cannot be overstated. Indee d economist s believe tha t suc h major technological change s cause long-ter m growt h i n economi c activity , while down-turn s are cause d b y a lac k o f suc h technologica l impetu s (Mensc h 1977) . Eve n withou t considering the so-calle d lon g wave s o f economi c activit y (Kondratiev waves) , i t i s clea r that innovations of such importance cause majo r economic change . Whether this change i s always beneficial is quite another matter, which will be discussed later . Generally speaking, new technologies tend , at least initially, to provide economi c growth, thoug h som e innovation s may hav e stron g labour-savin g effect s an d thus cause unemployment. Whether unemploymen t will prevail, depends o n the balance betwee n increase d economi c activit y cause d b y technolog y an d othe r factors, an d th e degree o f labou r saving , again cause d b y technolog y an d othe r economic factors (Freeman et al. 1982; Rothwell/Zegveld 1981) . Competitiveness of firms, i.e. the degree to which they can maintain, or increase, thei r market share and their profitability, i s also determined b y a large number of factors, an d some of the m ma y wel l b e outsid e th e contro l o f th e firm . A n inescapabl e necessity ,

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however, i s tha t th e fir m shoul d us e appropriat e manufacturin g technology, i n order to ensure high productivity and adequate quality of its products. Economists use d to speak a great dea l abou t using the correct mix of factors of production, i.e. inputs of labour and capital or , sometimes, othe r factors , suc h as energy. Th e correc t mi x i s determined b y facto r prices . I n high-technology pro duction, however, suc h consideration s hav e become secondary . High-technolog y products, suc h as integrated circuits , cannot be manufactured without the appro priate automate d machinery . N o amoun t o f labou r ca n substitut e for capita l i n these cases. Even in traditional construction work , the choice i s not as flexible a s it used to be, mainl y for social reasons. It is inconceivable tha t i n a major engi neering project, as for example the construction of the channel tunnel, huge gangs of labourer s wit h pic k axe s coul d replac e th e sophisticate d monste r machine s cutting their way through the ocean bed . Appropriate production technology may be determine d b y technologica l o r economi c considerations , bu t ma y als o b e strongly influenced by social factors . Regulatio n may wel l be an important social factor. It is to be hoped tha t in the future th e choice of production technology will be strongly influenced b y environmental considerations, though these might well come i n via regulations . Production technology , whateve r th e influence s upo n it s choice , i s see n a s a major determinan t of industrial competitiveness. For if a firm produces it s good s by a n inefficien t technology , the y wil l becom e to o expensive . I f a n ineffectua l technology i s used , th e good s wil l fai l i n th e marke t becaus e o f thei r lac k o f quality, o r wil l b e uneconomicall y produced becaus e o f a lo w yiel d of product s able to pass the quality hurdle. The fate of individual firms may well concern only a smal l numbe r o f people , bu t th e collectiv e fat e o f manufacturin g industry, or that o f ver y larg e firms , affect s th e live s o f whol e nation s and i s therefor e ver y much the concern o f governments.

3 Th e Perceived Need for Innovation Polic y Despite the above argument, the reader may well ask why technological innovation should b e th e concer n o f government . As i t is an economi c activity , why ca n i t not b e lef t t o privat e economic actors ? Ther e i s n o unequivoca l answer t o thi s question, an d th e matte r i s subjec t t o politica l controversy . Interestingly , even governments totall y committed t o extollin g the virtue s of privat e enterprise, d o not refrai n from intervenin g in the proces s of technologica l innovation , be i t by support o r b y regulation . The presen t chapte r attempt s t o answe r th e question : why? W e conside r severa l aspect s o f th e answer , i n arbitrar y orde r (se e als o Roessner 1988) .

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3.1 Reductio n of Risk fo r Private Enterprise Innovation involves risk. Treading unknown paths, encountering unexpected tech nical difficulties, meetin g unforeseen market obstacles; thes e ar e but some of the hazards face d b y th e innovator . A s government s ar e vitall y intereste d tha t a s much innovatio n as is reasonably possibl e shoul d be undertaken , steps are taken to smooth th e path of innovators and to reduce their risks. The risks must be seen in relation to the size of the firm and the degree of novelty of the technology. Clearly, a very large an d affluen t fir m ca n affor d greate r risk s than a small business . Obviously, a moderate improvement o f a product sol d on a known market does not involve the same degre e o f risk as that encountered by embarking upo n a radicall y ne w technology , t o b e sol d o n a s ye t non-existent markets. I t i s not , howeve r just th e novelt y of eithe r technolog y o r market , bu t also th e sheer siz e and complexity of an undertaking which determines th e cost , and thus the risk involved. If th e potentia l economi c o r othe r benefi t t o th e communit y i s deeme d t o be great , an d th e ris k involved for th e innovatin g firm to b e greate r tha n i t can reasonably be expected t o bear, then public bodies feel justified in taking measures to share, or even bear, the risk. Sharing can be done by government alone, or else by collaboration with other firms, and even with other governments. The development of Concorde , th e Anglo-French supersoni c airliner , is a good cas e i n point. The British an d French government s got together an d arrange d fo r the collaboration between British and French aircraft manufacturers, while the governments footed a larg e par t o f th e bil l fo r thi s technically highly successful , bu t commerciall y disastrous, radical technological innovation. The ris k t o th e innovato r ma y thu s b e share d wit h governmen t or , wit h o r without the help of government, with other commercial firms. However, reducing the risk to the innovator may take many forms - financial underwriting or sharing of the risk is not the only means of making it bearable. Othe r measures attempt to increase th e chances o f success an d thus aim at reducing, rather than sharing, the risk. Detail s o f possible measure s wil l be discussed later, but essentially support can be given to make technical, commercial, or managerial information and advice more readil y availabl e an d thus enhance th e chance o f a positive outcome. Risk flows fro m th e ver y natur e of th e innovatio n process, bu t competen t an d well informed handlin g can reduce th e risk by increasing the chances of success . Much th e sam e argument s can b e applie d t o proces s innovation , and eve n t o manufacturing innovation. The literature dealin g with the diffusion o f innovation distinguishes between pioneerin g users , early users , an d laggards i n the applica tion of new production technologies. Th e pioneering users clearly run large risks when buying untried radically new machinery, as many early users of robots found to thei r cost. I f government believes tha t overall th e ne w technology i s likely to be beneficial, and likely to improve the competitive position of domestic industry on worl d markets , the n i t migh t assis t pioneerin g user s o f th e ne w technology .

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Assistance ca n be financial, e.g. b y buying or subsidizing the machinery for pio neering users, or it can be advisory, e.g. helpin g users to make the best o f the new technology an d to overcome early malfunctions. Interestingly, virtuall y al l government s i n advance d countrie s wit h marke t economies (thes e ar e the ones we are speakin g o f here, an d thi s statement doe s not exclude other governments) , do support innovatio n for the reasons discusse d above. I n fact suppor t for innovatio n has becom e an integra l part o f governmen t attempts to keep thei r countries internationall y competitive. Competitio n in support policie s ha s been adde d t o industria l competition i n the battl e for share s i n international trade in manufactured goods. 3.2 Publi c Requirement s for New Technologies There i s a perceive d publi c requiremen t fo r progress . Whateve r els e i s mean t by this ambiguous word, technologica l progres s i s certainly included. Somehow , governments have become burdened wit h the responsibility for ensuring that th e advanced countr y shoul d remai n advance d and , i f possible , b e a t leas t as , o r more, advance d than other countries. Being advanced means , among other things, to invent , produce, an d us e th e lates t technologies . Bein g wealth y ha s becom e associated wit h bein g technologicall y advanced. Surprisingly , social inequality, high crim e rates , poo r educationa l facilitie s an d star k povert y d o no t see m t o detract fro m th e conception o f being advanced . I f a few of your countrymen can go to the moon, i t does not seem to matter if many others ar e homeless an d perish in the streets . The ques t fo r technological innovatio n is one o f th e mai n strands in th e quest for progress . I f governments shoulde r th e responsibilit y for progress , the y must see t o i t tha t technologica l innovatio n proceeds a s fas t an d a s successfull y a s possible. Whethe r th e publi c doe s o r doe s no t requir e particula r technologie s shall b e discusse d later ; wha t i s certai n i s tha t th e publi c require s a constan t stream o f ne w technologie s i n orde r t o foste r economi c growt h a s muc h a s i n order t o be progressive . The abov e critica l viewpoin t undoubtedly ha s som e validity , though a mor e positive point of view is more generall y accepted an d thi s will no w be explored . There ar e three type s o f application s for whic h technologies ar e required b y th e public, and in all of these innovation is, rightly or wrongly, constantly demanded. The three applications are: (i) public technological infrastructure, such as transport and communication s systems o r sewerage ; (ii ) defence an d security , suc h a s equipment for the armed forces , th e police, or fire brigades; an d (iii) technologies to relieve societal problems, suc h as urban congestion, or environmental pollution. If a country is to remain internationally competitive, and is neither to put its own industry an d commerc e a t a disadvantag e no r discourag e industria l investment by foreigners , i t mus t hav e a n up-to-dat e infrastructure . Th e infrastructur e is

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either ru n directl y b y th e stat e o r b y state-owne d companies , o r is , a t least , controlled by the state . I n any case, ne w technologies for the infrastructur e are a public requirement and governments must see to it, one wa y or another, that the infrastructure i s up to the required modern standards. Innovation in this sphere is therefore a concern o f government, and hence some form of policy for innovation is inescapable . That innovation in defence and public security is a responsibility of government goes withou t saying. Eve n th e mos t market-oriente d an d non-interventionis t of governments accep t responsibilit y i n th e area s o f defenc e an d publi c security, and thus accept the task of equipping th e security forces wit h adequate technical means. Unfortunately, technical means do not remain adequate for long and have to b e brough t u p t o th e lates t standard s continuously . In n o spher e o f huma n activity i s technological innovatio n pursued a t such a forced pac e a s in defence; and agreemen t o n a slower pace can onl y be achieve d wit h great difficulty , a s it must be obtained internationall y through disarmament agreements. On a mor e cheerfu l note , technolog y ca n mak e genuin e contribution s to th e solution of societal - particularl y environmental - problems . N o matter whether the problems wer e created by the use of technology in the first place; w e cannot dispense wit h technology i n seeking solutions . As the environment cannot look after itself and looking after it often runs counter to individual immediate interests, particularly thos e o f industria l firms, it mus t b e a publi c concer n i f i t i s no t t o deteriorate beyon d al l hop e o f repair . I t is , o f course , enlightene d self-interest which should make the environment everybody's concern, but only public bodies can channel enlightened self-interest into codes of conduct and, more importantly, into technologically supported action. Thus government is ultimately responsible for obtainin g technologies require d to repair an d safeguar d th e environment. As most o f these technologies d o not exist, it is government which needs t o see to it that they are brought into existence and into use. We have discusse d mostl y th e natura l environment, but th e sam e considera tions apply to problems o f urban congestion, to crime, and to an y other societa l problem on e cares to mention. Obviously, none of these problems can be solve d by technolog y alon e - ther e are no technological fixes. Social, politica l and educational action i s indispensable and social innovatio n is as much a requirement as technologica l innovation . It just so happens tha t the presen t boo k deal s wit h technology; and hence, i t is technology w e concentrate on. 3.3 Directin g Private Innovation towar d Public Needs Most innovativ e activity i n market-oriente d societie s i s carrie d ou t i n privat e industrial firms. The fact that some of them may be wholly or partly owned by the state make s littl e or n o difference, as nowadays even suc h firms are usuall y ru n strictly on commercial principles . As discussed earlier, straight self-interest is not

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able to look after certain matters of importance to the whole of society. The natural environment is the most blatant case in point; though traffic congestio n and many other issues ar e not fa r behind. If, however, innovatio n in private firms is carrie d out wit h immediate self-interes t a s th e sol e motivation , i t i s unlikel y that thes e types of problem shall be solved. It was argued above that governments - o r rather the public - nee d certain ne w technologies. I n addition to public requirements, it is necessary t o tr y and giv e new directions t o the hug e creative force s i n private industry by tilting the balance of market forces somewhat i n the direction of social needs, instea d of leaving them to cater only for strictly self-interested needs . Adequate and environmentally acceptabl e equipment for the technological infrastructure i s no t th e onl y publi c nee d fo r technology . I t i s a t leas t equall y important tha t privatel y use d technology , whethe r fo r consumptio n o r fo r pro duction, shoul d becom e benign. I t is therefore necessar y t o tilt market force s i n such directions a s to ensure that private demand wil l move toward non-disruptive and sustainable technologies . Damage t o the environment and to the social fabri c can onl y b e repaire d an d avoide d i f both privat e an d publi c demand shif t i n so cially required directions . Technology polic y must, very slightl y an d sensitively, intervene in the market to achieve this change o f emphasis. It has been argued elsewhere tha t demand, o r need, canno t be neatly separate d from suppl y (Braun 1984) . There is no fixed shopping list for technologies whic h would-be innovators could consult to find all unsatisfied needs. Indeed, innovators merely gues s tha t thei r innovatio n might find a resonance , migh t kindl e potential wishe s int o actual demand . Fo r societie s an d individual s whose basi c need s are fulfilled , marke t deman d i s a proces s o f selectio n fro m availabl e offerings . Additional need s are satisfied by additional products purchased by, and creating, additional wealth . Any attemp t b y government to steer the offerings on the mar ket into socially acceptable directions cannot therefore be interpreted as depriving people o f their right to have essential needs satisfied. The need to steer technology for private consumption arises out of four consid erations: (i) to ensure the health and the safety of users o f a technology, whethe r in productio n o r i n consumption ; (ii) to safeguar d th e natura l environment; (iii ) to ensure compatibilit y and mutua l non-interference when a technology i s use d by many consumers; and (iv ) to promote technologie s whic h enhance the quality of life . The firs t consideration , i.e . safet y an d health , i s necessar y becaus e user s o f technical products cannot rely on the market alone t o guarantee the harmless an d safe natur e of products offered for sale. Indeed eve n publi c bodies find it difficul t to ensur e absolut e harmlessness , a s ver y ofte n previousl y unsuspecte d hazard s come t o ligh t after man y years o f apparentl y safe us e o f a product. Quit e apar t from that , th e marke t woul d discover th e lac k o f safet y o f a produc t onl y i n a haphazard manner and necessarily i n arrears, whil e the legislator at least attempts to provide safeguards i n advance of the introduction of a product onto the market.

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Although mos t o f th e abov e i s achieved b y regulatio n an d wil l b e discusse d later, innovatio n polic y doe s als o hav e a rol e t o play . I t i s possibl e t o buil d social criteri a int o the innovation process and, therefore, int o any policies for the support o f innovation . To mak e thi s possible, however , i t i s necessar y t o mak e early assessments of what the likely impacts, problems, an d results of introducing the innovatio n might be. Thi s typ e o f earl y assessment , know n a s Technolog y Assessment, i s a pre-condition fo r the successfu l incorporation of social criteri a into measures for the support of innovation. It is possible, for example, to support an innovation which is likely to increase th e safety of cars, or one that is likely to give public transport a boost, whil e not supporting innovations which are likel y to have th e opposit e effects . Similarly, it is possibl e t o promot e innovation s for crime prevention , reduction o f risk s fro m fire , improvement s i n treatmen t an d prevention o f disease, while withholding support fro m frivolou s and potentially hazardous innovations. We are discussing here th e support or lack of support fo r certain innovativ e activities, while leaving questions of regulation, prohibition or limitation till later . All th e abov e example s do , o f course , assum e a politica l wil l i n a certai n direction - i f the political will tends toward different goals , the examples have to be modified accordingly. There is nothing prescriptive in Technology Assessment , which merel y assesse s likel y consequence s o f ne w technologie s an d analyze s possible polic y options. The policies adopte d towar d such innovations are an act of politica l will , an d ar e guide d b y value s an d socia l objective s o f th e polic y makers. Technolog y Assessmen t i s a science, albei t a social scienc e wit h all the imprecision this implies, whereas decisions o n policies, and the administration of such policies, ar e acts of governance. The arguments advanced in support of policies designed t o enhance the safety of technological innovation s can be applied with equal force to directing innovations toward environmentall y benign technologies . Indeed , man y critic s wil l argu e that thi s mil d stanc e i s insufficient , an d tha t w e requir e a complet e chang e o f paradigm. No longer should we seek economi c growth , no longer should we seek the gratification of ever mor e trivia l desires; instead , we should seek t o save the globe from what they regard as certain destruction. Without necessarily wishing to disagree wit h these sentiments , they fall outsid e the scope of this chapter. We are not leavin g the prevailin g paradigm o f the desirability of growth and th e furthe r raising of material living standards, but merely adding some dimensions of socially desirable criteri a for the stimulation and control o f technological innovation . We are discussing the possibility of a subtle shift i n direction, in the hope that a small change wil l ultimately lead to the desired goal, rathe r than advocating a radical possibly desirable but probably unrealisti c - chang e of paradigm. The compatibilit y and mutual non-interference of technologies require s som e explanation. In his remarkable boo k Hirsc h (1977:22) discusses "individual satisfaction in a specific activity being obstructed by the similar activity of others". The obvious examples ar e road traffic an d tourism, though the latter is largely outsid e

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the scope of technology policy . In addition t o the need t o regulate ever y type and aspect of traffic becaus e o f the very obvious potentia l interference of each partic ipant with every othe r participant , ther e ma y be possibilities to ease the proble m by technical means . Technological progres s in this direction i s clearly preferabl e to innovations which mak e th e problem eve r mor e unmanageable . Thi s i s not to argue tha t th e proble m ca n b e solve d b y technica l mean s alone , bu t merel y t o suggest tha t technical solutions may help. Other technologie s are equally, though less disastrously , pron e t o interference . Radi o communication s ar e a n obviou s example, an d th e introductio n of cellular radio an d fibre-optic s communication s illustrate ho w technology can ease the problem. The final item in our list, improvements in the quality of life, refer not merely to urban congestio n ye t again , bu t mainly to improvement s i n working conditions, or i n th e lif e o f th e disadvantaged . I t ha s bee n argued , fo r example , tha t CN C machines can be introduced in ways which maintain the skills of their operatives, or i n ways whic h reduce th e operator s t o th e state o f moron s (Wilkinso n 1983) . If technological innovatio n can weigh i n on one side o r the other, th e 'good ' sid e should clearly be encouraged. Obviously , decisions o n the use of technology ar e made i n the politica l microcos m o f the factory , an d th e sam e technolog y ca n b e used i n many differen t ways . Nevertheless , som e usefu l positiv e feature s ca n b e built int o the machiner y withou t economic detriment , and innovatio n policy can be formulated so as to encourage suc h developments . Another example migh t be the care o f th e elderly. Technology ca n do littl e or nothing to change attitudes of families to their elderly relatives, nor can i t change policies on residential care or on the provision o f sheltered housing , home helps , and s o forth. Technology can , however, provid e som e aids t o help the elderly, or the disabled, t o maintain a degree of autarky. If so, promising innovations aiming at improving the chance o f independence o f people migh t be better candidate s fo r public support than man y of a rival technology . In summary, it is suggested tha t innovative activities might be assessed for their social utilit y and those tha t appear t o have the potential to improve the quality of life - a s defined b y the policy maker - shoul d be given priority in support. There i s a final - t o some th e most obviou s an d primary - poin t t o mak e about suppor t fo r privat e innovativ e activity . Governments ma y b e worrie d tha t the su m tota l o f innovatio n i s insufficien t t o maintai n economi c growt h an d support innovatio n for thi s reaso n alone . However , eve n i f th e achievemen t o f economic growt h i s the prim e purpos e o f suppor t fo r technologica l innovation , some additiona l criteria, suc h as those discusse d above , ma y be usefully applie d without detriment to the prime purpose. We liv e i n a highl y competitive world , an d government s ar e involve d i n in ternational competitio n i n innovatio n policies. Alas , t o avoi d suc h competitio n may prov e a s hard, o r harder, tha n slowing down, or eliminating, the arms race . Progress ha s bee n mad e o n th e arm s race , an d thi s ma y b e a n auspiciou s mo ment to attempt som e reductio n in the overall level s of support fo r technological

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innovation. On e da y i t ma y becom e apparen t tha t th e worl d woul d b e a bette r place i f technological innovatio n were slower . I t may als o tur n out that muc h of government suppor t i s futil e an d ineffectual , anyway . The da y tha t thes e thing s are recognized an d acted upo n internationally is far away, but the day when som e agreement o n reduced level s o f support is attempted ma y be closer a t hand .

4 Way s of Promoting Innovatio n We have discussed a number of reasons wh y governments migh t wish to suppor t entrepreneurs attemptin g t o produc e technologica l innovations . W e mus t no w look a t the means available for this purpose . 4.1 A Taxonomy of Possible Support Measures The first dimension in a taxonomy of support policies for technological innovatio n is th e targetin g o f polic y measures . Th e firs t distinctio n w e mus t mak e i n th e targeting o f suppor t measure s i s tha t betwee n direc t an d indirec t suppor t fo r technological innovation . The secon d distinctio n is between genera l an d specific support. Th e third distinction is the stage at which support is given, which can be at any stage fro m earl y research , t o advanced development , t o early production , and to the first stages of diffusion (Brau n 1984:39-71) . The secon d dimensio n i s give n b y th e domai n o f polic y int o whic h the suppor t measure s fall . Her e w e distinguis h between ; fiscal/financial , information/education, organizational/political , procurement/infrastructure , le gal/regulatory, science/research , industrial/commercia l (Brau n 1984:125-130) . Actual policy measures fal l withi n one of these polic y domains (thoug h the list is not exhaustive), and are targeted i n one o f the ways described. Tabl e 1 illustrates the above . The targeting of support for technological innovatio n requires some discussion. Direct o r indirect method o f support: i t is possible t o support technologica l inno vation by indirect measures, suc h as creating a good technologica l infrastructure , a goo d educationa l system , an d a n entrepreneuria l climate . Ta x incentive s fo r investment might also foster innovation in an indirect way, and so might the ready availability of risk capital . Many measure s fro m th e abov e lis t can , o n th e othe r hand , b e applie d ver y directly t o technological innovation . In education, fo r example, specifi c course s for manager s o f innovatio n and fo r entrepreneur s ca n b e arranged . I n creatin g an entrepreneurial climat e emphasi s ca n b e put on technological innovation , for example b y rewardin g innovator s an d inventor s with honour s an d wit h publicity, rathe r tha n rewardin g entrepreneur s o f a purel y commercial , an d possibl y

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Table 1: Targetin g an d domains o f policies for the suppor t o f technological innovation. A fe w examples o f policy measures which fit into the matrix direct/ indirect

general/ specific

research/ development/ diffusion

fiscal/financial

company taxation

innovation

R&D finance

information/ education

technical libraries

training courses

data bank s

organizational/ political

international cooperation

N. Targe t Policy \ v Domain ^ v

patent laws

purchase of prototypes

emission standards national labs

science & research

industrial/ commercial

R&D

railway investment

procurement/ infrastructure legal/regulatory

finance

support fo r environmental R&D

trade agreements

shady, type . Ta x incentive s can b e ver y specificall y directed towar d usin g th e latest productio n technology , o r towar d supportin g R&D , paten t activities , sci entific equipment , etc . Eve n ris k capital ca n b e mad e availabl e specifically fo r technological innovation, rather than for any kind of risky commercial enterprise. General o r specifi c support: Genera l suppor t aim s a t fosterin g innovation in general. I t stem s fro m th e belie f tha t technologica l innovatio n is a goo d thin g and canno t procee d a t a sufficien t pac e withou t public support . Som e degre e of selectivit y ca n b e introduced . Thu s ther e migh t be a programm e o f suppor t for innovation s in pollution control technology . This woul d give suppor t t o al l reasonably promisin g innovatio n projects i n thi s area , wit h a varyin g degree of selectivity. If the selectivity becomes very strict, i.e. only very few applicants for support actuall y receive it , the n th e suppor t i s n o longe r genera l bu t become s specific fo r selecte d projects . Specifi c suppor t ma y o r ma y no t b e aime d a t a particular area of technology; it may simply aim at highly promising and deserving projects, irrespectiv e of the kin d of technology involved. On th e other hand, it is perfectly feasibl e to apply any policy criterion, beyond the criterion of timeliness

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and promise, t o selective support. The transition from general t o specific support is continuous, from little or no selectivity to a high degree of selection . Technological innovatio n is a multi-stag e process. Th e literatur e list s at leas t three distinct stages, ofte n more, and emphasizes that the boundaries between the stages ar e blurred and not all innovations necessarily go through the same phases . The thre e stage s o f interes t her e are : earl y researc h an d development , furthe r development an d early production, early marketing and diffusion. Fo r simplicity, we have called the m "research", "development", an d "diffusion". A t what stage , or stages, o f the innovation process suppor t should be given by the state is a matter of some debate . The important issues in this debate are (i) What is the legitimate role of the state, i.e. should it support purely commercial enterpris e or should its role be confined to the support of public requirements and to research a s a cultural exercise? (ii) If the state is to support technological innovation, what is the stage at which help is most needed an d can be most effective ? The forme r point has been discusse d alread y to som e extent , th e answe r t o the latte r question depends ver y much on specific circumstances of individua l innovations. Because th e research an d developmen t stages o f innovation are the ones most commonly supported, th e next section wil l be devoted t o state support for R&D. 4.2 Researc h and Development R&D ha s become a major enterprise. Eve r sinc e the Secon d Worl d War, which proved th e prowess o f R&D fo r all to see, technologica l innovatio n has becom e more and more systematically based on R&D. While in the past innovative activity in many industries was craft-based and often not systematically organized, the post war years have changed all that. Innovation has become part of corporate strategy , and R& D ha s becom e th e spearhea d o f innovativ e activity . Industrial firm s i n some sectors , particularl y in pharmaceuticals, chemicals, electrical engineering , electronics, computers , an d aerospac e hav e becom e s o research-intensive tha t a substantial proportion o f their turnover is invested into R&D. In 1975 , the British aerospace industr y spen t 29 % o f it s outpu t o n R&D , thoug h onl y 5.2 % wa s self-financed; th e res t wa s finance d b y governmen t (Pavit t 1980:57) . I n 1985 , the rati o o f company-funde d R& D t o ne t sale s fo r al l Japanes e manufacturing industries wa s 2.7% , compare d t o 2.8 % i n th e Unite d State s (NS F 1988:11) . Japanese industr y financed 69% o f al l R&D; whil e in the US, industr y financed only 49% o f all R&D . I t must be said , however, tha t only 1 % of Japanese R& D goes toward defence, while about one third of US R&D is devoted t o that purpose (NSF 1988:9) . As Tabl e 2 shows , privat e an d publi c R& D hav e becom e s o larg e tha t tota l expenditure o n i t i s o f th e orde r o f severa l percen t o f gros s domesti c produc t (GDP) i n all advanced countries.

Promote o r Regulate: Th e Dilemm a o f Innovation Policy 1 1

1

Table 2 : Tota l R& D expenditure s for 198 7 as % of GDP fo r severa l countries , an d th e shares o f government an d industr y finance R&D a s % of GDP governmen

t (% ) industr

y (%)

USA

2.72

50.8

47.1

Japan*

2.59

19.4

73.7

FRG

2.71

35.8

62.8

France

2.28

52.9

41.0

GB*

2.42

39.8

48.2

Austria

1.31

48.5

48.8

* 198 6

Source: Passwe

g 199 0

Governments spend a very large amount of money on R&D and it is interesting to se e thei r ow n reasonin g i n justification o f suc h expenditure . Severa l theme s recur in virtually all official o r semi-official statement s i n support of public R& D expenditure. They includ e the need to maintain and enhance international competitiveness, the duty of the state to support pure research a s a public responsibility, and th e nee d fo r publicly funded researc h int o solutions of urgen t societal prob lems, such as environmental pollution. A few extracts fro m official statement s of various government s an d governmen t advisor y bodies ma y illustrat e the point s made. The y giv e the genera l flavou r o f th e justification fo r governmen t support for R&D , thoug h there ar e obviously considerable variation s in R&D policie s of different governments . In th e Technolog y Polic y Surve y 1989-1990 , presente d t o th e Netherland s Parliament, the following statements form part o f the introduction: Economic growt h is generated i n particular by the broad applicatio n of new technologies i n a wide range of products, service s an d processes. ... Innovatio n is increasingly recognised in industr y a s a strategi c facto r whic h i s essentia l fo r internationa l competitiveness. .. . Between 198 4 and 1988 , nominal corporate researc h an d development (R&D ) expenditur e rose by some 50%. .. . The technology polic y outlined in this Survey aims to (help) create a climate in which technological progress ca n be translated into economic growt h (Ministry of Economic Affair s 1990:5-6) . (Note: the levels of corporate an d government R&D spending as % of GDP i n the Netherlands are roughly comparable t o those i n France. )

The Swedish Governmen t Research Bil l states : In man y respect s i t i s justifiable t o sa y tha t th e scientifi c searc h fo r ne w knowledg e i s a societal concern , indee d a tas k se t b y society . I t i s regarded a s natura l and necessar y fo r companies t o invest in the development of new products and production processes. .. . It is just as natural and necessary fo r problems i n society t o be made th e subject o f research. .. . The natura l an d socia l science s ar e indispensabl e i n moder n society ; the y deepe n ou r

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perspective o n life and help us to find rational solutions to human problems. .. . I n the final decade o f th e twentiet h century and a t the beginnin g of th e twenty-first , the countrie s of the world are faced wit h the task of safeguarding ecologically sustainabl e development. .. . Environmentally oriented researc h i n all fields has a key part to play in this context (Cabine t Office 1990:8-10) .

The Federa l Germa n governmen t defines the aim s o f it s science , research , an d technology polic y as contributing to the following general aims : 1. The expansion an d enhancement o f scientific knowledge and thus to the further structural and organisational development of the federal Germa n research system. ... 2. To human e working and living conditions full o f opportunities, to a sustainable use of natural resources and henc e t o positiv e developments i n the natura l environment. 3. To improved chance s for technologica l innovatio n and thu s t o increase d efficienc y an d competitivenes s o f th e economy. 4 . T o a strengthenin g o f internationa l cooperation i n researc h an d technolog y (Bundesbericht Forschung 1988:18) .

The Federa l Germa n governmen t stresses tha t the state shoul d mainly devote it s resources t o basic research and to research int o long-term opportunities and societal problems, while devoting less effort t o the support of economically motivated R&D performe d i n industry. As state d earlier , technologica l innovatio n i s a multi-stag e proces s an d th e stage o f an innovatio n at whic h support i s given differentiates strongly between different attitude s to state support . I t is argued b y some tha t support shoul d only be given at a pre-competitive R&D stage . Thi s mean s at a stage whe n the feasi bility and general feature s of a technology are being developed an d no individual final designs ar e in sight. It is at this stage, some argue , that firms can cooperate on majo r ne w technologie s withou t compromising futur e competitiveness . On e example o f suc h R& D suppor t i s the Researc h int o Advanced Communications for Europ e (RACE ) programm e o f the Commission o f the Europea n Communities (CEC) . Thi s is an attempt to bring virtually al l European manufacturer s and operators o f telecommunications systems together to develop an advanced system of integrated broadban d communications (IBC). The programme require s uneasy compromises betwee n commercia l secrec y an d ope n research , between compe tition an d cooperation, an d betwee n politica l will at the centr e an d i n individual countries. The RAC E programm e i s an exampl e o f suppor t a t the R& D stage , but with a ver y definit e technological, politica l an d economi c outcom e i n mind . Indeed , the programme i s the result of the political will to develop and install a European broadband communicatio n system . Th e aim s ar e (i ) enhancemen t o f th e Euro pean telecommunications industry, and (ii) general improvement in the Europea n communications infrastructure and thus in economic performance . It is somewhat unusual to have such a very clear picture of what is wanted at the R&D stage . Usuall y this stage i s more exploratory , leaving many avenues open, full o f surprise and of risk. Many fee l tha t this i s the stage a t which state hel p is

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needed most and , more significantly , is most legitimatel y given. Those who fee l that competitio n an d marke t force s shoul d b e lef t undisturbed , argue tha t only R&D wit h unknow n outcomes i s a legitimat e subject fo r stat e support , becaus e at that stage i t is not clea r who , if anybody, wil l rea p commercia l reward s fro m the investment . As soo n a s the R& D come s clos e t o a commercially promisin g innovation, furthe r investment should b e lef t t o thos e wh o hop e t o rea p profit s from it . At the R&D stage stat e support can be given in the most general an d unspecifi c way. The stat e ofte n run s its own research laboratorie s an d results from these ar e either openly available , o r can be purchase d b y firms. The terms of availabilit y depend o n th e degree to whic h the stat e wishe s t o us e suc h laboratorie s fo r th e support of innovation. At the R&D stage a whole host of measures is available: they can consis t o f informatio n support, suc h a s hel p fro m governmen t laboratorie s or dat a banks . Organizationa l hel p ca n b e give n t o foste r university-industry collaboration, or financial assistance o r tax incentives can b e given for industrial R&D laboratories . It is equally possible, however , to be very specific in R&D suppor t and to give this only to selecte d programmes , selecte d scientifi c areas , o r selected laborato ries o r individuals . Th e selectio n ca n b e base d o n perceive d societa l needs , o r simply o n scientifi c excellence , o r both . Mos t government s suppor t a measur e of pure research wit h no technological application s i n mind, simply as a cultural enterprise, a n attempt to find out more abou t the structure of the natural world or of society. In the absence of private patrons, governments have felt obliged t o take over the patronage of culture in general, be it in the arts or the sciences. Sometime s pure scienc e ma y brin g unexpected practica l reward s an d indeed th e distinction between pur e an d applie d scienc e i s no t a t al l clear-cut . Hence , th e suppor t fo r pure scienc e i s fuelled b y th e hop e tha t somethin g unexpecte d ma y tur n up an d new discoveries may open new technological avenues (see e.g. Braun/MacDonald 1982). Selection o f R&D topic s b y societal need s i s certainly very appealing and few would dispute the need fo r more R& D int o environmental problems o r into some aspects of health or disease. However , support has to be geared to opportunities and to quality: there is no point in pouring in money in excess of the needs of available promising ideas an d creative researchers . Anothe r danger o f gearing suppor t too closely t o perceived societa l need s i s the necessit y to give serendipity a chance. Freely roamin g an d foraging by creative mind s may turn up the unexpected . An answer t o a proble m i n on e are a o f huma n activit y may com e fro m activit y in an entirel y differen t area . Cross-fertilizatio n is on e o f th e mode s o f progress o f ideas, an d this must not be stifled b y too rigid a framework of support . Education, especially the higher education sector tha t is of interes t to us here , has als o becom e a majo r enterpris e i n suppor t o f technologica l innovation. As education polic y i s outsid e th e scop e o f thi s chapter , le t i t suffic e t o sa y tha t the trainin g of engineer s an d scientist s a t al l levels , a s wel l a s th e trainin g of

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skilled worker s an d continuin g education in th e us e o f ne w technology , play a vital supporting role in technological innovation. 4.3 Direc t Support for Innovatio n Direct suppor t fo r technologica l innovatio n can b e give n a t al l stage s o f th e innovation proces s an d ca n b e a s general , o r a s specific , a s government s ma y wish. Th e basi c mod e o f direc t suppor t consist s o f paymen t of th e full , o r a n agreed proportio n of, the cost o f the selecte d par t of an innovation process. Th e supporting organizatio n ma y als o hel p i n a variet y o f ways , e.g . b y arrangin g partnerships or making available information otherwise unavailable. The Federal German government, for example, has recently launched a major new interministerial programme in support of information technology . Support is envisaged right across the boar d fo r this key technology, i.e. fo r all it s branches and a t al l stage s o f R& D an d diffusion . Thi s i s a n interestin g example o f th e conscious intermeshing of economic and technology policies. The measures range from re-regulatio n o f telecommunication s and ne w legislatio n on intellectual property, righ t down t o financin g majo r researc h institution s (Zukunftskonzept Informationstechnik 1989) . There i s a large numbe r of variou s support scheme s fo r variou s technologies in mos t countries . Some , a s th e abov e Germa n scheme , comprehensivel y supporting a larg e an d widesprea d innovation , others i n suppor t o f a ver y specia l one-off project . Generally , governments announce schemes i n support o f certain technologies an d invit e applications fo r grants. Sometime s th e work t o be don e is spel t ou t i n grea t detail ; i n othe r schemes , i t i s lef t t o th e imaginatio n of th e innovator. Thoug h mos t government s d o hav e priorit y areas fo r support , som e scope is usually left fo r initiatives from innovators to apply in non-priority areas, because i t is recognized that new ideas , indee d ne w ranges o f technologies, ma y offer opportunitie s not foreseen by the originators of support programmes . It is a frequent feature of such schemes that they attempt to encourage coopera tion and partnerships either between industrial firms, or between firms and universities, or firms and government laboratories, or any combination of the above. The reason fo r these attempt s i s the recognitio n that cooperation, thoug h potentially highly beneficial, is not without its own costs and is not easily achieved between either rivals or unequal partners. An example of such a policy is the LINK schem e of th e U K Departmen t o f Trade and Industry . One o f the aim s of the schem e is described as : "To help industry exploit developments in science and make scientists more aware of industry's needs by strengthening the links between industry , higher education , the Researc h Council s an d othe r researc h establishments . .. . LINK wil l build on, and extend over a much wider field, the experience alread y gained i n collaborativ e programme s t o th e efficiency , innovativ e capacity an d competitiveness o f industry and commerce" (LINK Secretariat 1988) .

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5

4.4 Procuremen t Procurement, i.e . purchase s b y publi c bodie s and , ver y significantly , th e military, is an old-established metho d o f supporting innovativ e technologies i n area s deemed significan t t o government . I t is particularly a method muc h favoure d in the Unite d States , a s i t doe s no t hav e th e ba d odou r o f publi c involvemen t in private technological enterprises , an d ye t achieve s suppor t o f innovation and, at the same time , has an economic regulator y effect . It ha s ofte n been sai d tha t th e microelectronic s revolutio n cam e abou t i n th e USA because o f military support for this technology. Although it can be disputed that militar y support brough t abou t thi s revolution , there ca n b e n o doub t that it smoothe d it s path . "I n th e fiftie s an d earl y sixtie s the Militar y wa s a mai n market for semiconductor products and often the only one for new and expensive components. New firms often found the military market a particular boon.... That situation has now changed and the computer industry and consumer markets are of much more importance" (Braun/MacDonal d 1982:142) . In this case, procurement played an important role in the innovation, and is playing a lesser role in the mor e mature technology . That many a development in civil engineering, or in railway equipment, and the like, owes it s existence t o public procurement goe s withou t saying. What i s les s obvious, and indeed remains a moot point , is the degree to which normal civilia n products ow e thei r lif e t o innovatio n undertaken eithe r fo r th e arme d force s o r for spac e exploration . I t i s probabl y saf e t o sa y tha t spac e exploratio n woul d either hav e no t take n plac e a t all, or a t a much slowe r rate , ha d no t th e military forced th e development of both rockets an d satellites. Though th e only consumer product tha t may safely b e called a by-product o f space exploration i s said t o be the non-stic k fryin g pan , ye t ther e i s n o denyin g that satellit e communications are equall y a by-produc t o f spac e investments . Thus th e argumen t tha t military procurement brings no civilian benefits, though appealing, is not entirely tenable. The argument that it would be more cost-effective to go for civilian development s without the detour of military development is , of course, unassailable . Quite a fe w products , fo r exampl e th e hovercraft , hav e mixe d sponsorship . They receive d a grea t dea l o f direc t hel p i n thei r development , an d the y als o achieved a significant militar y market i n their early life , thu s contributing to th e viability of the innovation. No doubt th e direct ai d was given with one eye firmly fixed on military possibilities, and thus direct aid cannot be neatly separated fro m procurement aid .

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5 Nee d for Regulatio n Whether w e like it or not, modern society , or indeed an y society, cannot functio n without certai n rules . Unfortunately , the us e o f moder n technologie s ha s no t decreased this need. T o the contrary , th e us e of technology itsel f requires a vast array o f rules. It has frequently been argue d that regulation retards technologica l progress; an d i t ha s almos t equall y frequentl y bee n argue d tha t th e demand s made b y regulations ar e equivalent to marke t demand s an d indee d presen t ne w opportunities for technological innovations. We shall leave both possibilities open, as it is highly likel y tha t both mechanisms do indeed operate. Which dominates , depends entirel y on the technology and on the regulation. Be this as it may, the regulation of technology i s inescapable, an d we shall now briefly explor e why . 5.1 Adequac y and Compatibility of Products The consume r o f technological product s need s t o be protected fro m a variety of dangers agains t whic h the old rule of "buye r beware " is no adequate safeguard . Most product s o f modem technology ar e too intricate and complex t o be subjec t to anythin g like an exhaustive and revealin g inspectio n b y la y consumers. Thu s certain rule s ar e neede d t o guarante e t o th e consume r tha t product s ar e indee d fit fo r thei r purpose , i.e . tha t thei r performanc e i s u p t o th e standard s give n i n their description . I t i s no t goo d enoug h t o rel y entirel y o n th e marke t i n thi s respect. The market forms its judgements but slowly and retrospectively, an d the cost of learning about the quality or fitness for purpose of products by individua l consumers woul d be ver y high . Indeed ver y fe w consumer s woul d risk buyin g new products, other than from a small number of companies with high reputations. In the absenc e o f some consume r safeguards , innovatio n by smal l and unknown firms would b e virtuall y halted , while innovatio n by larg e companie s woul d be slowed down . Fitness fo r purpose implie s minimu m standards o f quality. It also implies safety , which will b e discusse d later , an d a quality w e migh t term non interference. A n exampl e o f this ar e rules requiring electrical machiner y that is liable t o interfere with radio and television, to be appropriately shielded. Anothe r example is the requirement for headlights of motor cars to fulfil certai n standards , including dippability . Motor car s hav e t o fulfi l quit e a numbe r of requirements: about rea r lights , direction indicators , number plates an d numerous other items , all designe d t o brin g the moto r ca r unde r som e sor t o f socia l control , howeve r inadequate, as fit to be used on public highways. Another exampl e o f regulatio n fo r non-interferenc e i s furnishe d b y broad casting, an d generall y th e us e o f electromagnetic wave s fo r th e transmissio n of information. I f unbridled competition wer e allowe d to take place , nobod y coul d use electromagneti c wave s fo r th e transmissio n o f information , because eac h

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7

message would be likely to interfere with many other messages, thus leading t o a breakdown of the system. Only by allocating specific wavebands, and making very clear rules, has it become possible to use electromagnetic wave s for broadcasting of radio and television , for public telecommunications, an d for communications of the emergency service s o r radio-controlled taxis . Telecommunications, even without terrestrial or satellite electromagnetic trans mission, has traditionally been subjec t to regulation for a number of compelling reasons. First and foremost, to ensure that every subscriber could reach every other subscriber; secondl y to ensure that privacy i s safeguarded for conversations an d data transmission, an d thirdly for reasons of social equity. Some of the regulation can and has been achieve d by voluntary arrangements within the telecommunications industry, though not without some involvement by government. Other social objectives, suc h as socia l equity , requiring that every subscriber , irrespectiv e o f location or intensity of use of the facility, should have the right of access to a telephone at a reasonable and affordable price, were achieved largel y by government regulation.

5.2 Safet y an d Health As consumers cannot protect themselves against possible hazards posed by the use of certain technologies, they need to be protected by society, i.e. by government or its agents. Recent developments in fillings for upholstered furniture provide a good example fo r th e nee d t o regulat e the safet y of products . Ho w ar e consumer s t o know whether the upholstery of their new expensive furniture is easily ignited and then gives off lethal fumes? Indeed, even furniture manufacturers did not initially know, and it took a number of fatal accident s before regulation s were formulated to protect consumers from this particular hazard. Similarly, consumers cannot tell whether their electrical appliances are likely to electrocute them and must rely for their protectio n o n th e complianc e o f th e manufacture r with regulations . Som e products canno t be mad e entirel y safe withou t losing their effect, e.g . lavator y cleansing material s and th e like . I n thi s case, ther e ar e regulation s to mak e th e product a s saf e a s i s consistent with it s efficacy , an d fo r labellin g the material s adequately to warn of residual dangers. Similar regulation s are provide d i n th e workin g environment. Every country has some act laying down the ground rules, and every country has something like a factory inspectorate which enforces the rules. Essentially, these rules make sure that machinery use d i n production, or even i n offices, i s as safe as i t can b e an d that production processes do not pose avoidable hazards. All th e above example s fal l int o the larg e class o f technological product s that require regulations for reasons of safety. Indeed, this class is one of the first which gave rise to government intervention in technology. The boilers of early steamer s

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on th e Mississipp i apparentl y were won t t o explode , unti l th e U S governmen t found i t necessary t o promulgate rules for the safety of steam boilers . It i s remarkabl e tha t one o f th e mos t dangerou s product s o f technology , th e motor car, is allowed by society to continue to wreak havoc among the population. Although a large number of rules and regulations attempt to make the motor car somewhat safer, the number of deaths and injuries continues at a very high level without drastic actions being taken. Regulations can only be made when they are politically acceptable, i.e. when the users of a technology wis h to be protected withou t too high a cost to themselves, either in monetary term s or in terms of unacceptable restriction s on the use of the technology. A clas s o f regulation s somewhat simila r to thos e relate d t o safety , ar e thos e designed t o safeguard the health of the users o f products. A n example is the us e of lea d a s a componen t o f pain t or a s a n additiv e to petrol . Smal l quantitie s of lead i n paint are unlikel y to lea d t o fata l accidents , bu t there i s a certain dange r that the health of consumers, particularly that of small children, may be impaired. Thus the us e o f lea d i n pain t has bee n severel y restricted . Similarly , lea d i n th e exhaust of motor cars is considered a health hazard, and attempts to eliminate the use of lead a s an additive to petrol ar e in progress. For the sam e reason , th e us e of asbestos ha s been restricted, becaus e the inhalation of certain types of asbesto s fibres poses a severe risk to health. The latest risk, being slowly recognized at the present time , is that from aluminiu m as an additive to water. No doubt it will take quite some battles before regulations on the use of aluminium are tightened up in the light of new scientific findings, but eventually such regulations are very likely to be seen as a necessity. A major class of products which is strictly regulated fo r reasons o f hazards to health ar e pharmaceuticals . A s drug s use d t o cur e diseas e ar e potentia l cause s of disease , a n elaborat e machiner y t o tes t th e safet y o f drug s an d a syste m o f licensing them ha s been established. Some sa y that the system i s inadequate, as now and again a previously undetected hazard comes to light after a drug had been in use for some time. Others say that the system is too severe an d has crippled th e innovative potential of pharmaceutical companie s because it takes too lon g and costs too much to get a new drug approved .

5.3 Environmenta l Protection The thir d clas s o f technologie s whic h require regulatio n ar e thos e tha t pos e a danger to the environment. Initially, this danger was regarded more of a nuisance than a danger and the first perceived nee d was to regulate emissions from factorie s simply to reduce the nuisance to the neighbourhood. Thus the first British Lighting and Washing Act (1833), regulating effluents, and the Alkali Act (1863), regulating

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emissions, wer e created ; and other countrie s followe d wit h simila r legislation in due course . As knowledg e abou t danger s t o th e environmen t increased , s o regulation s became mor e comprehensive an d more severe , althoug h there are very great lag s between knowledg e an d regulation, and ver y great discrepancie s betwee n actua l severity and that demanded b y environmental activists. Even th e mos t arden t believe r i n th e benefit s o f unhampere d marke t force s generally admit s tha t th e environmen t cannot b e adequatel y protecte d b y thes e forces. Th e reaso n i s simple : an y cost s tha t a produce r ca n shif t awa y fro m himself an d tur n int o so-calle d externalitie s ar e beneficia l t o th e consume r i n terms of reduced prices , and/o r t o the producer i n terms of increased profits . On e way o f reducing costs i s to sav e o n filterin g an d cleanin g processes and shif t a s much waste a s is permissible int o the environment. Another danger t o the environment is its excessive exploitatio n a s a source o f raw material s an d mean s o f production . This i s precisel y wha t i s happenin g in the rai n forests o f th e world . I t i s als o happenin g t o agricultura l land, whic h is being farme d s o intensivel y as t o pollut e th e soil , th e river s an d lakes , an d th e ground-water. Without wishing to recapitulate the well-known catalogue of destruction being wreaked upo n th e environment , w e wis h t o establis h tha t unregulate d marke t mechanisms ar e inherentl y incapable of safeguarding the environment. This ha s been true historically, and is equally true today. Regulation i s one possible - an d indispensable - wa y of safeguarding the environment. Strict rules on emissions and effluents mus t be formulated, enforced , and continuously updated. The disposal of waste must be regulated and made safe , while every effor t mus t be mad e t o reduc e th e amoun t o f wast e produced . Thi s can be done by regulating the use of packaging and making rules on re-cycling of materials. Regulation i s necessary , bu t no t sufficient . I t i s equall y necessar y t o creat e incentives for the reduction of waste in general, and dangerous wast e in particular. The incentive s can be purely financial, but they ca n also be institutional. A good infrastructure for recycling and for the safe disposal of waste should be high on the agenda of public administrations. It may be possible t o provide marke t incentives for environmentally-benign technologies, and it may also be necessary t o provide subsidies t o accelerate th e diffusion o f such technologies . Support shoul d b e given fo r technological innovation s which decreas e waste , improve recycling , improve wast e disposal , reduc e th e consumptio n o f energ y and raw materials, reduce emissions, etc . It is impossible and unproductive to separate the two faces of technology polic y entirely. Regulation and support are the two sides of the coin of technology policy , and if the coin is to be worth anything, the two faces mus t be well coordinated. I t is not a matter of carrot or stick, but a judicious combination o f the two.

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6 Mode s o f Regulation Regulation i s controversial . Ther e ar e thos e wh o argu e tha t governmen t inter ference ha s gon e to o fa r an d shoul d b e decrease d o r virtuall y eliminated . Th e arguments are in part about freedom, but a larger part revolves round the issue of the cost of regulations an d their benefits. The first argument cannot be resolved, a s it touches upo n fundamental belief s largely unaffecte d b y rationa l argument . The onl y universal agreement tha t can be reached i s that suggeste d b y John Kenneth Galbraith: "there is a large rang e of suc h activit y where th e larger interes t - th e more genera l libert y - require s control (an d i t wil l certainl y alway s b e imperfec t control ) ove r th e lesse r an d more specific interest". I n another passage Galbraith makes th e unassailable, but not ver y helpful , poin t tha t " a distinctio n between wis e regulatio n an d unwis e regulation" must be made (Galbraith in Siegan 1980:8-9) . Regarding the costs of compliance with regulation, a recent summary of existing studies comes to the conclusion that "existing studies shed little light on the dispute between those who hold that regulation benefits the regulated and those who hold that regulatio n i s o f necessit y a burde n o n thos e wh o ar e regulated " (Peacoc k 1984:39). In the absence o f hard evidence t o the contrary, and with the vital proviso that regulation must be wise, it seems that the arguments produced earlier in support of a regulative role of technology policy, taken togethe r wit h historical evidence of the disastrous effects of laissez faire in matters technological, provide a watertight case in favour of a modicum of regulation. Th e crucia l question s of when, how, and ho w muc h canno t b e answere d i n a generall y helpfu l wa y an d hav e t o b e resolved fro m cas e to case and issu e to issu e i n the ligh t of everything that ha s been sai d before . Regulation rests, a s it were, upo n three pillars: - Laws , statutes , an d by-laws, i.e. legislatio n passe d b y competent legislativ e authorities. Th e law s themselve s ca n specif y regulator y detail , bu t generally they enable executiv e authorities t o issue specific orders and to make detaile d arrangements. - Order s specifyin g details of regulations within the given legal framework. The details provide the flesh on the bones of legislation and specify what should or should not be done in specific cases. The orders are issued by the authorities, e.g. ministries or local authorities, or other statutory bodies, specifie d as competent in the relevant laws. - Th e final pillar consist s o f the various enforcement agencies . A s all power s of the state , final enforcement an d arbitration rest with the courts, but the allimportant day-to-day enforcement and detailed supervision rest with regulatory agencies. Th e institution s created fo r regulator y supervisio n ar e a t leas t a s important as the legal framework in which they operate.

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Detailed arrangement s clearl y diffe r fro m countr y t o countr y an d fro m subjec t matter t o subject matter. No detailed accoun t ca n be given i n a short tex t of this nature; onl y outlin e principle s an d a fe w examples . Th e matte r i s furthe r com plicated b y the fact that some regulatory function s are fulfilled b y supra-national organizations, particularl y the Commission o f the European Communities . What w e described a s laws, statute s and by-laws consists, i n the United Kingdom, mainl y of primary legislatio n embodied i n Acts o f Parliament, which may be public , an d thu s applicabl e quit e generally , o r private , an d thu s relatin g t o a specifi c issue . A t th e loca l level , loca l authoritie s ca n enac t by-laws , whic h are, however , considered as subordinate legislation and thus are , unlik e primar y legislation, open t o legal challenges . What we described a s orders specifyin g details of regulation can, in the United Kingdom, take a variety of forms and are invariably regarded a s secondary legis lation. On e for m ar e Orders i n Council, anothe r ar e orders, regulations , rule s or schemes issue d by a Minister of the Crown. Some statutory bodies ma y also issu e orders, though these nee d t o be endorsed b y a minister. A variety of enforcement agencie s ar e set up under either primary or secondar y legislation. Man y o f thes e agencie s operat e unde r approve d Code s o f Practice , which do not have the force of law, but constitute an important instrumen t setting down methods b y which regulation is enacted i n practice . Examples of such agencies i n the UK are the Health and Safety Executive, which operates unde r the Health and Safety at Work etc. Act. The executive controls th e work of an inspectorate, whic h has comprehensive powers . Tw o further example s are the Office o f Telecommunications (OFTEL) , which regulates the deregulated telecommunications industry; and the Office o f Water Service s (OFWAT) , which regulates the privatized wate r and sewage services . In man y case s o f regulatio n o f th e us e o f technology , fo r exampl e i n th e case of roa d traffic , ther e i s n o specifi c statutory body enforcin g legislatio n an d enforcement i s in the hands of the general law-enforcemen t agency, i.e. the police .

7 Summar y an d Conclusions Technology polic y consist s o f a mi x o f measure s i n suppor t o f technology , an d particularly in support of technological innovation, and measures regulatin g technology. Support i s given mainly with the general ai m of strengthenin g the competitiv e position of industry in world markets, and of causing economic growt h by satisfying ever new consumer demands. Another for m of support of technology consist s of the provisio n o f a moder n technologica l infrastructure , such a s transport an d communications, and o f supplyin g public services , includin g the arme d forces , with adequate equipment.

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Regulation o f technolog y is not a n ai m i n itsel f but i s necessar y fo r a variety of reasons . Th e mai n reasons ar e th e nee d t o safeguar d safet y an d health , an d to protec t th e natura l environment . It i s argue d tha t a degre e o f regulatio n i s unavoidable and , i f wisel y chose n an d judiciousl y balanced , ca n hav e highly positive effects, while lack of regulation can cause considerable damage . The suppor t o f technologica l innovatio n b y th e stat e i s a somewha t mor e doubtful enterprise . I t ma y b e argue d tha t i f th e econom y i s arrange d i n suc h a wa y a s to ensur e that the mai n benefit s fro m technologica l innovatio n accrue to privat e industry , the n privat e industr y shoul d als o bea r th e cost s an d risk s associated wit h the innovation. It seems damagin g that international competition in technolog y ha s bee n supplemente d b y internationa l competition i n suppor t measures for technological innovation. On the other hand, it is argued that the state ought to try and support such technologies that are of obvious benefit to the public at large, first and foremost among them environmentally-benign technologies. As with regulation , n o very genera l rule s ca n be stated - ther e i s no substitute for handling the support of technology with sensitivity and good judgement. References Bessant, J. , M . Grun t (1985 ) Management an d Manufacturing Innovation i n th e United Kingdom an d West Germany, Hampshire: Gower . Braun, E. (1984) Wayward Technology, London : Pinter . Braun, E. , S . MacDonal d (1982 ) Revolution i n Miniature, Cambridge , GB : Cambridg e University Press. Bundesbericht Forschung (1988 ) Bonn : Der Bundesminister fü r Forschung und Technolo gie. Cabinet Offic e (1990 ) Government Research Bill 1989/90:90 , Stockholm : n o publisher stated. Collingridge, D . (1980) The Control o f Technology, London : Pinter . Coombs, R. , P. Saviotti, V. Walsh (1987 ) Economics and Technological Change, London : Macmillan. Freeman, C . (1982) The Economics of Industrial Innovation, London : Pinter. Freeman, C. , J. Clark, L. Soete (1982) Unemployment an d Technical Innovation, London : Pinter. Hirsch, F. (1977) The Social Limits t o Growth, London : Routledg e & Kegan Paul. Landau, R., N. Rosenberg (eds. ) 1986 ) Th e Positive Su m Strategy: Harnessing Technology for Economic Growth, Washington : National Academy Press . LINK Secretariat (1988 ) LINK Mechanisms an d Guidelines, London : Departmen t of Trad e and Industry. Mensch, G. (1977) Das technologische Patt, Frankfurt/Main: Fischer . Ministry o f Economi c Affair s (1989 ) Technology Policy Survey 1989-1990, Th e Hague : Government Printin g and Publishing Office . NSF (Nationa l Scienc e Foundation ) (1988 ) Th e Scienc e an d Technolog y Resource s o f Japan, Special Repor t NS F 88-318, Washington, DC: NSF .

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Passweg, M . (1989) Forschung un d Entwicklung. Trends i n der OECD und i n Österreich , in: Wirtschaft un d Gesellschaft No . 4: 511-536. Pavitt, K . (ed.) (1980 ) Technica l Innovatio n an d British Economic Performance , London : Macmillan. Peacock, A . (ed.) (1984) Th e Regulation Game, Oxford: Blackwell. Roessner, J.D. (ed.) (1988) Government Innovation Policy, London : Macmillan. Rothwell, R., W. Zegveld (1981 ) Technical Change an d Employment, London: Pinter . Siegan, B.H. (ed.) (1980) Government Regulation and the Economy, Lexington : Lexington Books. Stoneman, P . (1987 ) Th e Economic Analysis o f Technology Policy, Oxford : Clarendo n Press. Wilkinson, B. (1983) Th e Shopfloor Politics o f New Technology, London : Heinemann . Zukunftskonzept Informationstechnik ( 1989) Bonn: Der Bundesminister für Forschung und Technologie und De r Bundesminister für Wirtschaft.

New Technology Polic y Concepts : Some Reflections on Technology an d Work Humanization in West Germany Richard Badham and Frieder Naschold

1 Introductio n As knowledg e o f th e varie d socia l influence s o n technologica l innovatio n increases, s o ar e technolog y polic y concepts ar e neede d tha t come t o term s with this complex reality. This is not least apparent in the area of process innovation in the workplace. Simplisti c models of "R&D push" , "produc t cycles " or "marke t demand" are giving way to a more sophisticated recognitio n of the national institutional and cultural factors influencing the rate and direction of technical change. As different nation s expand the role of technology policy in the development and diffusion o f new production technologies, these conditions are attracting greater attention. Researc h an d polic y orientations are startin g to tak e into accoun t th e broader institutiona l influence s o n th e competitiv e advantage of nations and ad dress th e effec t o f nationa l systems o f innovation , industria l clusters , regional networks and patterns of skil l formation. One component of these changes i s the emergence o f a new policy orientation towards promotin g increase d productivity . Influenced directl y by th e enormou s successes of Japanese manufacturin g techniques , more attentio n (a s represented, for example , b y th e Sundquis t Report) i s no w bein g pai d i n technolog y polic y circles t o th e organizationa l a s wel l as technologica l component s o f successful innovation. I n Europea n countrie s such a s Wes t German y an d Sweden , i t als o involves a significan t re-orientatio n of nationa l work humanization activities. In Sweden fro m th e lat e 1970 s an d i n Wes t German y fro m th e middl e 1980s , a 'new languag e of workplace reform ' emerged . I n Sweden, i t took th e for m of a growing consensus between pea k managemen t and unio n bodie s o n the need t o establish a 'post-Taylorist ' wor k form with an emphasis o n "capita l rationaliza tion rather than division of labour" a s the key to both efficiency an d participation (Elam/Börjeson 1991:11) . In West Germany, i t was apparen t i n the tren d withi n the 'Humanizatio n o f Work ' programm e awa y fro m a n anti-rationalizatio n humanization stance, to the acceptance of "comprehensive innovation concepts" that accepted a degree of variance i n the rationalization drive; and i t emphasized th e promotion o f developmen t pathway s or path s o f rationalizatio n that combine d increased productivity with improvements in the quality of working life.

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This tren d i n technology polic y ha s been clearl y apparen t throughou t Europ e in the late 1980s . As one extensive review of European programmes i n the area of technology, work and organization points out, it was during this period that "a trend becomes graduall y discernible: a developmen t i n th e directio n o f a desig n an d policy-oriented integral approach" based on a tight coupling of "effectiveness an d technological innovation with socio-organizational renewal" (den Hertog/Schöde r 1989:88). Th e developmen t o f thi s approach i s clearl y controversial . Fo r som e critics, it constitutes a "flexibilit y orthodoxy" , " a languag e o f social integration of the 1980s : how to live with insecurity and unemployment , and bow to market forces"(Pollert 1990:98 ; see also Polier t 1991) . For others, i t is perceived merel y as the latest stage of rather ineffective socio-technical strategies in work design, or the search fo r more sophisticate d forms of 'spee d up' through quality of working life initiatives. In the eyes of its supporters, however, it represents both an absolute requirement if European firms are to remain, or achieve, worl d competitiveness in productivity, and the only realistic form in which humanization of work initiatives can be pursued. If these Ne w Technology Policy Concepts (NTPCs ) ar e taken seriously , however, thre e majo r challenge s hav e t o b e met : firstly , overcomin g man y o f th e traditional limitation s o f wor k desig n reform s an d programmes ; secondly , ad dressing th e competitiv e strengt h o f ne w Japanes e manufacturin g techniques; and, thirdly, establishing the conditions necessary fo r new forms of systemic and interdepartmental technolog y policy. After briefly reviewing the nature of NTPC s and the nature of these challenges, this chapter focusse s on the experiences o f the Humanization of Work programme i n West Germany in order to throw some light on th e practica l difficultie s facin g programmes i n this area, an d o n th e type s o f political as well as socio-technical issue s that have to be addressed if comprehensive innovatio n concepts ar e to live up to their name and incorporate an effectiv e broader approach t o innovation promotion.

2 Ne w Technology Polic y Concept s A commo n them e o f NTPC s i s th e nee d fo r th e consideratio n o f th e "social " aspects of process innovation in a "proactive" manner as a key factor in the "pro motion" o f effectiv e technological change . Commitmen t i s give n to promotin g "post-Taylorist", "post-mechanistic", o r "post-technocratic" approaches t o orga nizational chang e tha t involve : greate r collaboratio n betwee n syste m designer s and user s i n the desig n phase , greate r workforc e consultation i n the implemen tation phase , an d increase d attentio n to operator-workforce initiativ e i n ongoing incremental innovation and continual learning organizational structures. A se t of assumptions an d priorities underlie this emphasis, i.e . a commitment to th e priorit y o f enhance d internationa l competition an d th e developmen t o f

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advanced technologica l system s t o meet thi s end - whil e identifyin g advanced systems wit h flexible skill enhancin g techno-organizational structures ; a signifi cantly greater emphasi s upo n the importance o f developing appropriate form s of training and work organization a s a crucial componen t of innovation promotion; and a stress upo n the significance of system operator s or users in the design, im plementation and furthe r developmen t o f usable an d efficien t hardware/softwar e systems. In this sense, a 'social' orientation is firmly embedded withi n the commitment to direct technology promotion for enhanced internationa l competitiveness. This techno-economi c concep t lie s at the core of NTPCs just as much as the ide a of improve d technolog y regulatio n t o avoid costl y citize n oppositio n "dow n th e line" represented a key feature in economic justifications in the 1970s . Such a "comprehensive" approac h to innovation requires technology ministries to become involve d in areas of human factors in system design, work organization, education and training, and organizational design - a s a necessary componen t of their commitment t o innovatio n promotion. Thes e are al l issues tha t have i n the main eithe r no t bee n explicitl y addresse d i n governmen t polic y o r hav e bee n dealt wit h by othe r ministries . In th e are a o f proces s innovation , therefore, the y represent th e initial emergence o f new technology policy concepts tha t transcen d traditional dualisms of industry oriented technolog y "promotion" versu s socially oriented technolog y "regulation" , o r technolog y polic y an d educationa l policy. In th e process , i t i s asserte d tha t bot h productivity-oriente d technical consider ations an d quality-of-worklife-oriente d socia l consideration s ar e addresse d b y these ne w initiatives . This ca n b e clearl y see n i n man y o f th e lates t statement s of th e Germa n Ministr y for Researc h an d Technolog y (BMF T 1990a , 1990b) . Thus, i n Apri l 1990 , th e BMF T Wor k an d Technolog y programm e (Arbeit un d Technik, AuT) statemen t confirme d this orientation i n it s focus upo n a "comprehensive innovation" concept tha t "serves the objective t o attain a higher level of production an d services an d likewise to design an d organize the world of work in accordance wit h human needs an d social equity . In the process, th e development of huma n resources an d qualification , comprehensive industria l safet y an d pro tection o f healt h mus t be considere d o n equa l term s wit h technological issues " (BMFT 1990b:3) . The officia l genera l report of the BMFT on the modification of the Humanization of Work programm e (Humanisierung de r Arbeit, HdA) an d its significance fo r the ministry's overall activities is that there i s now less emphasi s on the "subsequen t improvement " o f technology, an d a new orientation toward s "humane an d user-friendl y design" , "involvemen t o f th e users" , "adaptatio n o f the organizationa l environment", etc. , o n the basi s tha t they are "acknowledge d principles of technological innovation" and "essentia l fo r our country to be abl e to survive in international competition" (BMFT 1990b:27). ' As mentioned above , however, these concept s hav e to face up to a number of challenges .

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3 Traditiona l Limitation s o f Work Desig n Reforms an d Programmes European countries have long been known for their range of humanization of work programmes. Drawin g upon socio-technical concepts an d ideas developed during the 1950 s - mos t forcefull y at the Tavistock Institut e in the UK - man y of these programmes emerge d fro m the qualit y of working life debate s i n the 1970 s and found mos t prominent expression i n the Norwegian industrial democracy experi ments, the West German Humanizatio n of Work programme and the projects an d programmes funde d by the Swedish Wor k Environmen t Fund (Badha m 1991b) . Serious doubt has, however, been thrown on the theories and strategies that have informed and been employed by these programmes. A s is revealed in comprehensive evaluations of job design experiments an d the establishment of new forms of work organization, no t onl y d o thes e ofte n affec t a relatively small proportio n o f th e workforce but their past success in achieving their stated goals of increased partic ipation, enhanced productivity and extension beyond 'local' experiments is highly questionable (Kelly 1982; Grootings 1990) . Moreover, systemati c assessment s of humanization of work projects hav e suggested tha t many fail t o continue beyond the initial pre-phase, rarel y involve major attempt s t o transform technology, and have not emerged a s "exemplary models " successful in diffusing ne w production "paradigms" (Leydesdorff/van den Besselaar 1987:3-4 ; Schalloc k 1991). 2 In part , thi s ma y b e attribute d t o th e limite d vie w o f th e object o f wor k hu manization reforms, i.e . an overly exclusive focus on direct production work and management labou r contro l strategies , rathe r tha n a broader assessmen t o f an d intervention i n th e rang e o f organizationa l conditions , managemen t objectives , inter-firm relations and industrial support structures that either facilitate or hinder work humanizatio n reforms. Thi s i s a facto r increasingl y recognize d b y som e traditional proponent s o f labou r proces s theory , ne w productio n concepts , an d socio-technical initiative s (Sorge/Streeck 1988 ; Knight s et al. 1985 ; Kelly 1982) . In addition , however, these problem s hav e been linke d to the methods o f work humanization reforms . Fo r example , whil e considerabl e critica l attentio n ha s been pai d within technology policy analysis to the usefulness of direct promotion measures, man y wor k humanizatio n initiatives have continue d to rel y upo n th e direct promotio n o f "exemplary " model s a s a ke y t o effectiv e diffusion. Yet , as observed i n critical evaluation s of the Developmen t Programm e o f the Swedis h Work Environment Fund, these models are often not copied an d a more comple x understanding of diffusion processe s is required (Gustavse n 1987) . European proponent s of NTPCs ar e concerned t o address thes e issues through more effectiv e introductio n of wor k humanizatio n concerns int o technologica l design an d implementation , and th e integratio n of organizationa l redesig n int o the innovatio n process. Wit h a n increasin g stres s o n "interdisciplinar y syste m design" (rathe r tha n simpl y "human centred " o r "anthropocentric " design ) an d

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"comprehensive innovatio n processes " (rathe r tha n wor k humanization) , i t i s asserted that these represent importan t attempts t o design, implement and diffus e competitive soc/o-technica l system s a s a key component o f effective innovation and enhanced productivit y (den Hertog/Schöde r 1989 ; Kid d 1990).Th e key rol e attributed t o technolog y policie s tha t promot e suc h comprehensiv e innovatio n processes i n a n exercis e i n "constructive technolog y assessment " indicate s th e arrival of new technology policy concepts i n the stimulation of process innovation (OECD 1988) . These concepts dra w som e plausibilit y from thei r effective critique of, firstly , the productivity problems facing US-influenced images of the hi-tech "unmanned " factory o f th e futur e tha t neglect s th e centra l rol e o f organizationa l factor s i n innovation and, secondly, the lack of effectiveness of past idealistic humanization projects tha t fai l t o successfully address efficienc y considerations an d economi c diffusion i n thei r pursui t o f humanizatio n goal s (Ebe l 1990:22-25 ; Warne r e t al. 1990) . Wher e the y hav e s o fa r bee n les s successful , however , i s in , firstly , convincingly showing how European condition s can be successfully exploited t o compete effectivel y with the Japanese challeng e and, secondly, detailing how this is t o b e promote d throug h national political processes tha t constrai n an d direc t technology polic y initiatives.

4 Th e Japanese Challeng e One o f th e area s i n whic h NTPC s hav e bee n les s successfu l i s i n addressin g those apparen t competitiv e strengt h o f Japanese model s o f production tha t have adequately integrate d organizationa l conditions int o the innovatio n process an d do combine efficiency consideration s with, at least, developed personne l policies . What basi c organizationa l principle s or ke y concept s o f th e Toyot a Productio n System (TPS ) (Fruin/Nishiguch i 1990 ) o r 'Japanese ' mode l ar e advocate d b y proponents o f interdisciplinar y systems desig n an d comprehensiv e innovatio n processes? To what extent do European wor k humanization ideals and production conditions require a modification of such models, an d to what extent is this likely or possible i n the face o f increased internationalizatio n and competition? While i n man y respect s 'post-Taylorist' , th e Japanes e Toyotist ' model s o f production innovatio n provide a n alternativ e model t o man y of th e mor e 'craft oriented' wor k reform s i n Europe . Th e Europea n programmes , strongl y influ enced b y craf t union s drawin g thei r membershi p fro m manufacturin g industry and production personnel , have been strongl y biassed toward s the utilization and development o f traditiona l craft skill s an d freedoms . Thi s orientatio n conflict s in a numbe r o f way s wit h Toyotist o r Japanes e form s o f wor k organization , in particular in th e amoun t of discretion give n t o shopfloo r operators , th e level s of pacing and wor k intensification , an d the degree o f co-determination i n corporat e

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planning (Klei n 1991 ; Jürgen s 1990) . I n th e fac e o f th e 'Japanes e challenge' , however, the competitive viability of the craft-oriented model i s seriously thrown into doubt . A s reveale d i n a variet y of reports , thi s model ha s bee n remarkabl y successful i n achievin g major gain s i n productio n flexibility , qualit y and cos t reduction. As illustrated in the recent MIT report Th e Machine that Changed th e World (Womac k e t al. 1990 ) the introductio n of this "lean production model" in the automobil e industr y ha s achieve d productivit y benefits that fa r surpas s th e achievements of such European producer s as Volkswagen. The vie w of "total qualit y management" (TQM) comin g out of Japanese expe rience and promoted by the Japan Productivit y Centre, involves suc h ke y princi ples as : a demand-driven production system mor e strongl y linked to the market ; production just-in-time with rapid throughpu t and lo w inventories; emphasis on product quality and built-in quality in the production process; step-by-step quality assurance by skilled production workers; organization for incremental innovation through worker suggestions and quality circle structures; production by small selfmanaging multi-function teams ; training and payment systems based o n accurat e productivity measure s an d rewar d fo r skills ; cooperative interna l firm relations; and collaborativ e inter-fir m sub-contractin g network s (Mathew s 1990a) . A s a n embodiment o f ne w manageria l principles , it s genera l characteristic s ar e wel l illustrated by Robert Boyer (1989) in his list of 1 2 key principles of a post-Fordis t model (se e Table 1) . As recognized by the 'systemation' o r 'systemofacture' analysts , however, there may be a number of variations within this model. The technical and organizational trend toward s compute r integrate d manufacturin g (CIM) ma y tak e a numbe r of different forms . As Carlotta Perez observed i n her classic analysis of systemation, "the ne w paradigm combine s trends towards centralizatio n and decentralization, towards more control and more autonomy, so the variety of combinations is likely to b e quit e wide , no t onl y i n th e presen t transitiona l period , bu t probabl y int o the future upswing " (Perez 1983:453) . With specific reference t o the Toyota Pro duction System, a detailed study by Fruin and Nishiguchi significantly conclude s that whil e "th e 'success ' o f th e TP S i s evident , much studie d an d discusse d i n Japan and elsewhere" i t is paradoxical that it is "even without a dearcut definition and understanding o f th e TP S i n Japan, (that ) the TPS ha s become an example , inspiration, an d visio n of wha t i s possibl e i n th e worl d o f productio n organiza tion and management" (Fruin/Nishiguch i 1990:18) . They cit e the acknowledge d founder of the TPS, Mr . Taiichi Ohno, who observes tha t "We know that the TPS works but we don' t kno w wh y i t works so well " (Fruin/Nishiguch i 1990:19) . It is just no t clear to observers or even the founders of the mode l themselve s wha t the key unchangeable features are of the model, an d what is largely superfluous, particularly Japanese, o r even inefficient . Thu s i t has been commented : Just ho w much Japan's distinctiv e forms of company organisatio n an d industria l relations should be credited for the astounding competitive power of Japan's manufacturing economy

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New Technology Polic y Concept s Table 1: Fro m Fordism to a new model: A synoptic presentatio n Fordist principle s

The challenges o f th e 1970 s and 1980 s Th

Fl: Rationalizatio n of labour is the main target, mechanization i s the means

C1: Under-utilizatio n o f equipment, large inventorie s of wor k i n pro cess

PI: Globa l optimisation of the whole productive flow s

F2: Firs t design an d then manufacture and organiz e wor k process

C2: Lag s and larg e costs in passing from innovatio n to effective pro duction

P2: Tentativ e full integratio n of research, developmen t an d pro duction

F3: Indirec t an d mediate d link s with consumers vi a marketing studie s and strategie s

C3: Loosin g touc h with choosy con sumers, failure s in launching new products

P3: Clos e and long lasting ties between producer s an d users, cap ture learnin g by usin g effects

F4: Lo w cost fo r standardized prod ucts is the firs t objective , quality the secon d on e

C4: Ex-pos t qualit y control s cannot prevent a rising defect rate , con sumers more selectiv e abou t quality

P4: Hig h quality at reasonable costs, via a zero defec t objectiv e at each stage of the production proces s

F5: Mas s production fo r stable and rising demands, batch productio n for unstable demands

C5: Eve n mass consumer demand s become uncertain: the Fordist pro duction process appears a s rigid

Pi: Inser t the market demand int o the production decisions withi n smaller an d les s hierarchica l unit s

F6: Centralizatio n of most decision s about productio n i n a special division o f a large fir m

C6: Sluggis h an d inadequate reactio n of hea d quarter s to global an d local shock s

P6: Decentralizatio n as far as pos sible of production decision s within smalle r and less hierar chical units

F7: Vertica l integration, mitigated by circles of subcontractor s

C7: Give n radical innovations , even large firms can no more maste r the whole technique s needed for their core business

P7: Networkin g (and joint ventures) as a method fo r reaping both spe cialization an d coordination gain s

F8: Facin g cyclica l demand, subcon tractors ar e used a s stabilizing device, in order t o preserve larg e firms' employmen t

C8: Durin g the 1970s , bankruptcie s and/or loss of competence o f sub contractors, no w confronted with international competition

P8: Long-ru n an d cooperative subcon tracting as far as possible, i n orde r to promote join t technical innovations

F9: Divid e and specialize at most pro ductive tasks, mai n sourc e o f pro ductivity increase s

C9: Excessiv e labour division might turn counter-productive: risin g control an d monitoring costs; built-in rigidity

P9: T o recomposc production, maintenance, qualit y control an d som e management task s might be mor e efficient, technicall y and economically

F10: Minimiz e the required genera l education and on the job trainin g of productiv e tasks accordin g to BABBAGE's and TAYLOR's principles

CIO: New technical opportunitie s (IT) , more competition and uncertai n demands challenge mos t o f the previous very specialized task s

ΡΙΟ : A new alliance between a minimal general education and effective o n the job training , in order to maximize individual and collective competence

Fl 1 : Hierarchica l control an d purely financial incentive s to manufacture and implici t consent t o poor job content

Cl 1 : Youn g generations, bette r edu cated an d with differrcnt expecta tions, reject authoritaria n management styles . Too much control become s counter produc tive

PI 1 : Huma n resources policies have t o spur workers ' competenc e an d commitment an d work ou t posi tive support fo r firm' s strateg y

F12: Adversaria l industria l relations converge toward s wag e demands ; collective agreement codify a pro visional armistice

C12: Firms employment might be hurt by th e lac k of cooperation an d exclusive concern fo r wage. A contrario, concession bargaining does not necessarily provid e an y advantage fo r wage-earners

PI2: A n explicit and long ter m com promise betwee n manager s an d wage earner s i s needed t o reap a general suppor t t o this model : commitment versu s good working conditions and/o r job tenure s and/ or a fai r sharin g of modernizatio n dividends

Source: Boye r (1990:8)

e principle s of a new mode l

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(in particular) remains an open question. Alternative arguments abound - th e role of culture as a sourc e o f wor k motivation , th e macroeconomi c managemen t o f th e econom y b y government ministries , th e abundanc e o f chea p capital , th e lowe r transactio n cost s tha t Japanese-style 'relationa l contracting' brings. But the prima facie case is a strong one. Th e advantages o f Japanese wor k organisatio n see m t o centre o n a more flexibl e an d efficien t use of human resources, an d the capacity to motivate and channel extraordinary high levels of workforce disciplin e and commitment (Lincol n 1990:38) .

It i s thi s lac k o f certaint y abou t th e necessar y feature s o f th e mode l o r th e vi ability o f differen t variant s tha t make s assessment s o f differen t industr y secto r and nationa l models s o important. Although general interpretation s of "nationa l trajectories", o r th e influenc e exerte d b y "nationa l pattern s o f skil l formation " or "nationa l system s o f innovation " are necessarily generalize d an d speculative at this stage, the y represent a n important enterprise. Mos t significantly , fro m th e point of view of European wor k humanization concerns, som e of the ke y issues concern th e compatibility or alternative effectiveness of more 'craft-oriented ' ap proaches t o work organization, and the types of supportive institutional structures that mak e thes e a possible competitiv e option . A s discusse d recentl y b y Janic e Klein, i n a stud y of th e applicatio n o f Japanes e technique s by U S firms , tradi tional socio-technica l view s emergin g fro m Europ e o f job enrichmen t through semi-autonomous groups were premise d o n a reduction in task interdependenc e using buffer stocks . Yet , as new Japanese system s of JIT an d standardized work techniques are used to improve quality, reduce costs and speed up throughput time, a key aim is the reduction of such buffers an d increased task interdependence. On the one hand, this reduces the degree of discretion over work methods and the pace of work in individual task execution. O n the other hand, it has been accompanie d within these factories by greater input of employees int o collaborative task design, as suggestions for changes ar e mad e and discussed fro m th e lowe r to the higher levels of the organization (Klein 1991). In this way, direct individual autonomy in task execution i s sacrificed but replaced b y indirec t collectiv e autonom y in task design. Important question s ar e raised her e concernin g not only the reality and value of thi s trad e of f fo r th e qualit y o f workin g life , bu t als o th e exten t t o whic h greater autonom y can and should be delegated t o shop floor operators t o enhance experimentation and learning in a search for continual and dramatic improvements in proces s qualit y an d efficiency , an d t o what degree thi s is restricted withi n the Japanese syste m an d may be more viable in the production cultures and product market condition s of a number of European industrie s and countries. As Jürgens (1990) has argued in a specific discussion of the automobile industry, a meaningful contrast ca n b e draw n u p betwee n wha t coul d b e see n a s a 'Germa n model ' of skille d worke r oriente d labou r regulatio n an d a 'Japanes e model ' o f group oriented labou r regulation. In comparison t o the Taylorist approach, bot h model s increase the degree o f self-regulation on the shop-floor, and both the competenc e

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and willingnes s o f productio n worker s t o accep t responsibility . However , the y also differ i n important ways. The central characteristic o f the German mode l is the role of the skilled worker and a specifi c understandin g of skille d wor k a s a "profession" . I n condition s of a 'surplus ' o f highl y traine d worker s (t o a degre e impose d o n firm s b y th e vocational trainin g system) , job desig n an d technology us e to address problem s of absenteeis m (agai n strongl y influence d by lega l an d contractua l regulations) , and union/works council demands for lengthening work cycles, the emphasis is on the use of qualified labour , "uncoupled fro m the production cycle and the rhythm of the machines" (Jürgens 1990:13) . The emphasis i n production syste m desig n is upon the stimulation of work interest, comprehensive responsibilit y and a large degree of self-regulation. This is, however, to a significant degre e stil l restricte d by the direct pressures o f production, and such workers ar e increasingly required to perform such simple production tasks as setting dies, feeding parts, transporting materials, etc.). Wha t emerges i s a new type of hybrid German skilled worker. The Japanese mode l gives a central role to qualified labour, but not to uncoupled skilled labour . The ke y featur e o f th e Japanes e mode l i s "self-regulatio n unde r the pressur e o f th e assembl y lin e and th e productio n pace " (Jürgen s 1990:13) . Work groups are of central importance in providing integrated job understanding, flexible wor k an d expande d labou r deploymen t withi n th e productio n system . This occurs , however, under a regime of ongoing coordinated assessmen t o f best possible syste m performanc e an d permanent improvemen t throug h the continuous revie w of established time-standard s (thi s contrasts strongl y to th e Wester n industrial engineerin g practice s tha t ai m fo r 'normal ' performanc e an d ar e re stricted i n thei r time-standard s review) . Self-regulatio n i s no t base d o n skille d worker competence and professional ethics but the activities of the work group in the more tightl y coupled and continuously improved systems outlined by Klein. These models , a s Jürgens (1990 ) emphasizes, exer t stron g influenc e o n othe r countries. I t is probably of little surprise t o learn tha t increased vocationa l training i n British factories hint s at the adoption of the German way , while American companies ar e clearl y mor e influence d b y Japanes e concept s wit h a searc h fo r the formatio n of productio n groups i n unskille d areas, an d a flexibilizatio n an d expansion o f workers' area s o f deployment. There are , however , tw o clear con straints o n th e wide r adoption o f the Germa n model . Firstly , as Jürgens argues, the strong anchoring of the German mode l i n a structure of co-determination an d a corporatist syste m of vocational education means a degree of institutiona l an d legal limitatio n on company headquarters ' scop e for action and decision-making that is liable to mak e it unpopular with management i n other countries, even if it is socially and economically possible. Secondly , Japan has strong cost advantage s over Germa n manufacturer s and the competitive strategy of German car compa nies to go "u p market " i s facing increase d competitio n by Japanese competitor s now producing higher valued cars and equipment. In the face of such threats, and competition fro m low-wag e and increasingly efficient ca r producers, a key issue

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concerns th e degree of importance of future technologica l developmen t i n ensuring production efficiency. I f the effective implementatio n of computer integrated manufacturing (CIM) models becomes mor e significant for productivity, and their combination of flexibilit y an d integratio n is strongly supported b y highly skilled and responsible workers, then the German mode l ma y have a strong chance. It is possible, Jürgen s concludes, tha t a mixture of the Japanese an d German model s will emerge , wit h group formation, job integratio n and extreme wor k efficienc y in manufacturin g mass production , an d skilled-worker-oriente d team formation and professionalization in high-technology and service areas . The challenge provided by the Japanese model does not , however, only exist at the level of the work process. It also extends into broader assessment s o f national systems o f innovatio n an d skil l formation. Ther e is , fo r example , a n emphasi s in th e TP S mode l o n th e improvemen t of inter-fir m collaborativ e arrangement s and th e establishment o f integrate d network s an d learnin g processes . However , as observe d b y a numbe r of commentator s (Perro w 1990) , th e ne w balanc e o f competition an d collaboration i n new networks may take on a variety of differen t forms, rangin g from networks of interdependent an d innovative small firms (e.g. Third Italy), sub-contracting links of Japanese firms, to forms of corporate decen tralization, divisionalizatio n and interna l competition as practice d b y a number of American an d German firms. The range of alternatives and their relative effectiveness in different condition s is far from a closed issue . The existence of present alternatives should not, however, lead to a complacent recognition of diversity: for with the astounding competitive success of the Japanese system and the increase d internationalization of production, any examination of the viability of alternative forms mus t directly face the issu e o f the exten t to whic h alternativ e production models wil l be able to continue to survive. This whol e discussio n an d debat e raise s th e ke y issu e o f ho w th e relativel y recent collaps e o f th e America n Fordist mas s productio n mode l o f production efficiency an d it s at leas t partia l replacemen t by th e Toyotis t flexibl e mas s pro duction model i s to be interpreted. I s this best seen in terms of the replacement of one dominant national exemplary model or "paradigm" o f production by another , with other countries forced to adapt to 'best practice'? Or is the present best see n as an era of uncertainty in which a variety of different model s are in conflict? Even more importantly, perhaps, there are two further issue s to be addressed: firstly, the degree to which there is room for either significant different variation s within the Japanese productio n model or alternatives to that model; and, secondly, the degree to which the success of the Japanese mode l extends its "flexible mass production " techniques int o areas of industr y previously far les s influence d b y th e U S mas s production mode l tha t required large standardized markets . The extension o f the focus o n 'comprehensiv e innovatio n processes' t o incorporat e thes e issue s i s a key requirement for the further development and effectiveness of new technology policy concepts . Thi s i s an issue tha t is currently being explore d withi n innovation theor y (e.g . Columbi a Universit y Project o n Nationa l Systems Supportin g

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Technical Innovation) , regulation theory (e.g. CEPREMAP Researc h on National Trajectories), labou r marke t an d labou r polic y (e.g . WZ B Researc h o n National Patterns of Skill Formation), and both trade and state theory (e.g. BRIE Researc h Group, Berkeley) . If NTPCs are to be effectively developed an d taken seriously, they nee d t o build upon the findings of such groups.

5 Nationa l Conditions of NTPCs Even in their present form, however, NTPCs in Europe represent an important start in th e attemp t t o respon d t o th e Japanes e challeng e an d overcom e th e previou s limitations o f wor k desig n an d wor k refor m programmes . Ye t th e successfu l introduction an d furthe r developmen t of these concepts i n the technology policy arena face s substantia l institutional obstacle s fro m established polic y processes. They directly challenge the traditional ministerial 'division of labour' between, for example, research an d technology, education and training, industrial relations, and industry ministries : comprehensive innovatio n concepts requir e th e integration of thes e sphere s i n th e effectiv e promotio n o f increase d productivity . It i s no t surprising, therefore, that the content and success o f the initiatives that are being developed var y dependin g o n th e politic s o f differen t countries , an d tak e o n different an d controversia l forms . I f NTPC s ar e t o b e successful , the politica l and nationa l contexts withi n whic h they are developed an d deployed nee d t o b e explicitly considered within more comprehensive innovation promotion strategies. Yet the nature, source and significance of these NTPCs have so far received little sophisticated analysis. It is not possible, fo r example, t o simpl y 'rea d off thes e concepts i n th e polic y aren a a s a n 'instrumental ' reflectio n of eithe r changing trade unio n strengths and strategie s o r a 'scientific ' recognitio n of the objective efficiency o f new socio-technical production systems (den Hertog/Schöder 1989 ) or a ne w worl d o f wor k (Mathew s 1990b) . No r i s i t possibl e t o interpre t the m solely a s one partia l attempt to legitimate , as "socially oriented" , a global trend observable throughout the 1980s to subordinate government R&D and technology policy t o business requirements and industr y control (Dickso n 1984 ; Couchman 1989a, 1989b) . An examination is needed o f the wa y i n which the emergence o f NTPCs i n different countrie s both reflects and impact s upon the political , socia l and economic condition s of specific nations. Only in this way can these concept s be developed an d deployed i n a manner that maximizes the potential for utilizing national conditions to maximize the overlap between stimulating productivity and the quality of working life. At one level, a broader vie w of effective polic y measure s require s a more con sidered reflectio n o n th e influenc e o f governmental politics on th e promotio n of NTPCs. 'Instrumentalist ' perspective s underemphasiz e the importanc e o f bot h party an d ministeria l politic s in defining an d promotin g NTPCs. On e important

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issue fo r consideration , fo r example , concern s th e clea r overla p brough t abou t by NTPC s betwee n scienc e an d technolog y ministrie s and educatio n an d training ministries , and th e manne r in whic h they collaborate, conflic t an d negotiat e over th e natur e of "technology " promotion i n thi s area. A s interventio n in this field involves directly addressing the highl y politicall y charged are a o f working conditions, it is inevitable that "legitimatory" as well as 'accumulation' issues are raised (Off e 1985) . Ho w thes e issue s ar e defined , weighe d an d playe d of f wil l depend upon the political conditions within different states ; and it cannot be 'read off fro m international changes i n technology an d markets. At another level , the broader nationa l socio-economic condition s affecting th e nature an d possibl e scop e o f technolog y an d wor k humanizatio n initiative s is an important are a o f stud y for thos e concerne d wit h effective political intervention in this area. Some genera l comparison s may , for example, b e made betwee n contrasting initiative s in Sweden , Wes t German y an d Australia . In th e Swedis h case, the existenc e i n the 1970 s o f ful l employmen t an d increasin g educationa l levels le d t o increasin g manageria l concer n wit h labou r turnover , absenteeis m and recruitment problems. Faced wit h these problems, many new initiatives were created i n Swede n t o enrich productio n wor k an d improv e workin g conditions. The emphasi s upo n grou p work , employe e responsibilit y an d worke r partici pation wa s a direc t resul t o f addressin g thes e condition s i n th e contex t o f a strong trad e unio n movement an d a social-democratic government . I n addition, both influencin g an d influenced by these development s ha s been th e dominance within th e Swedis h econom y o f larg e internationall y competitive engineerin g firms characterized by rapid and effective introductio n of process innovation , despite comparativel y muc h lowe r rate s o f produc t innovatio n (Edquist/Lundval l 1989; Edquist/Glimel l 1989) . Thi s ha s resulte d i n what , t o paraphrase , ca n b e called a welfare-democratic/Fordist orientation towards job enrichmen t to secure or increase job satisfactio n amongst workers involved in rapid process innovation and i n conditions of ful l employment . In Germany, work humanization takes a different for m influenced by the differ ent nationa l socio-economic context . One o f the mos t prominen t features of the German federa l initiatives , when compared t o Sweden, i s the greater orientation towards technolog y a s a key facto r i n wor k humanizatio n and a stronger orien tation towards th e utilization and development of high levels of craft-production skills. Thi s phenomeno n ca n b e relate d t o a numbe r o f condition s i n th e Ger man syste m o f innovatio n and skil l formation. These include : the comparativ e strength of the German 'dua l system ' o f vocatio n educatio n an d training (Sorge et al. 1983) ; the general orientation of German industry towards the production of more customize d and higher quality products i n a side range o f industries when compared t o other European countrie s such as the UK 3 ; the deliberate promotion by the government of a viable domestic electronic and computer industry capable of serving assisting export intensive German industries; the dominant role withi n the economy o f a set of production equipment suppliers (machine tool industry)

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and high technology engineering "users" (automobile companies); influence that extends t o a n R& D syste m fo r productio n innovation that promotes productio n system concept s assistin g i n th e sal e o f hig h qualit y an d customize d machin e tools; and, in the creation of flexible quality oriented production systems utilizing comparative advantage s in workforce skills, oriented towards "diversified quality product" market s (Sorge/Streeck 1988 ; Ruth 1990; Badham/Lennart z 1990) . Th e result of these conditions is, for example, that the promotion by the Research an d Technology Ministr y (BMFT) o f production technology an d work humanization is strongl y oriente d toward s large r companies , advance d technologies , an d re search an d investmen t in production models strongl y influenced b y the machine building and automobile industry. This is clearly apparent in both the engineering activities of Fraunhofer Institute s and th e research o n ne w technology an d wor k organization b y a range o f industrial sociology researc h institutes . The ke y em phasis i n contrast to Sweden has , consequently, been mor e toward s a n approac h of Professional/Diversified Qualit y Production that emphasizes the promotion of advanced technology and the support and utilization of a high level of craft skills for th e creation o f new high-quality and customized products, with probably less diffusion o f organizationa l models o f group work o r extensiv e participation an d learning models . In stron g contras t t o bot h countries , the presen t commitmen t i n Australi a to improvements i n workin g conditions throug h "awar d restructuring " an d "skil l formation" change s i s primaril y a defensiv e respons e t o th e 1970 s collaps e o f manufacturing industr y an d employment , i n th e metal s industrie s in particular, following a dramatic reduction in tariff level s and increase d exposur e t o international competition . Thi s ha s encourage d union/managemen t collaboration i n an attempt t o create mor e productio n forms of production organization , a task tha t has focusse d o n the exchange by productio n workers o f traditional demarcation lines an d form s o f wor k contro l fo r ne w caree r path s an d skil l an d productiv ity related pa y increases . Although strongly influenced b y Swedish an d Germa n models, i n contrast t o Sweden ther e has been les s emphasis upon job satisfaction and absenteeism; and in sharp distinction to Germany, there is less stress upon relevant technological design and the adaptation to present high levels of craft skills. The orientatio n i s fa r mor e strongl y toward s a Reactive/Jo b Integratio n Skill s Push approach creating and rewarding appropriate skills and removing traditional educational and industrial relations barriers to this initiative (Badham 199la) . These thre e model s ar e of course merel y speculativ e sketches o f th e types of national conditions that may promote work humanization initiatives of a particular form an d scope . The y d o provide , however , th e kin d of orientatio n require d in developing NTPCs that take into account the conditions under which they are to be shaped an d implemented. Clearly, this is directly linked to the advances mad e in innovation , trad e an d stat e theor y tha t addres s th e genera l issu e o f national trajectories i n response t o changes in the form of international competition. They also involve , however, a direc t focu s o n th e characte r of , an d option s facing ,

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programmes t o explicitly improve working conditions as part of stimulating world competitive innovatio n processes. Fo r this reason, th e remainder of this paper will focus on some lessons that can be leamt from the German Humanizatio n of Work programme.

6 Backgroun d and History o f the West German Humanization of Work Programm e The furthe r developmen t o f ne w technology polic y concept s tha t effectively address these issues is clearly a major challenge. The intention of this paper is not to take these up in any comprehensive manner. Our concern here is more limited, that is to contribute in a small way to research o n these issues by revealing some of the conditions that have to be taken into account in directly promoting technology and work humanizatio n initiatives . This i s carried ou t throug h a brie f overvie w an d analysis of the complex tensions within the German Humanizatio n of Work (now, significantly, Work and Technology) programme . A n improved understanding of these processe s would , we argue , enhanc e th e effectiv e use and development of NTPCs. b y giving some insigh t into the wa y i n which the general issue s o f promoting productivity and the quality of working life through technology polic y are reflected an d dealt wit h in the form of detailed an d practical decision s that arise in the course of such programmes i n different countries. 6.1 Internationa l Backgroun d The rise of a humanization of work programme within Germany oriented in a sizeable degree to the creation of 'humane' technologies can be related to three general international conditions. Firstly, following the "socio-technical" initiatives beginning in the 1950 s and th e "quality o f working life" movement established i n the 1960s, the earl y 1970 s witnesse d th e emergenc e withi n Sweden, German y an d Britain of labour/social-democratic inspire d movements to extend these principles into effective humanization of the workplace. This wa s reflected in the establishment oftheArbetsmiijofonden i n Sweden in 1972 and the symbolically significant Lucas Aerospac e Pla n o f the Shop Steward s Committe e se t up in Britain also in 1972, a s well as the 'Humanizatio n o f Work (HdA) ' programm e i n Germany i n 1974. This phenomenon was directly noticeable i n West Germany with the strong influence on the establishment of the HdA programme of the IG Metall Quality of Work Life Conference i n 1972 , and the coming to power of the Social-Democrati c party (SPD) . During th e latte r par t o f th e 1970s , however , th e effectivenes s o f th e variou s national humanization initiatives became a source of major controversy. Particular

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attention wa s pai d t o th e lac k o f evidence o f substantia l economic successe s o r long-term surviva l of job redesig n experiments , th e importance o f avoiding management dominated "legitimatory" exercises i n job design , the severe restrictions on th e participatio n by trad e union s and worker s representative s early o n i n th e design o f new systems , an d th e significanc e of creating humane technologies a s well a s new forms of work organization if restrictive parameters o n job redesig n are not to be built into the system. In combination with less favourable economic conditions, these created a less widespread an d positive attitude to work reforms. Secondly, fro m 195 0 t o th e lat e 1970 s a reaction agains t contemporar y tech nological trend s and for what Bob Kling described in 197 3 a s a "people centred computer technology " emerge d withi n th e discipline s of cybernetic s an d com puter science, particularly within the control engineering and artificial intelligence communities. This trend, as detailed by Cooley (1990 ) is exemplified i n Norbert Wiener's boo k o n Th e Inhuman Us e of Human Beings (1950) , Id a Hoos ' pape r "When th e Computer Takes over the Office" (1960), Hubert Dreyfus' wor k fro m the earl y 1960 s culminatin g i n his boo k o n What Computers Can't D o (1972) , Mike Cooley's investigation of computer aided design (1972 ) culminating in his book Architect o r Bee?, Howard Rosenbrock' s boo k o n Computer Aided Control Systems Design ( 1974) and a serie s o f paper s beginnin g with classi c "Th e Fu ture of Control" (1976) , and Joseph Weizenbaum' s paper "O n th e Impac t of the Computer in Society: How Does One Insul t a Machine?"(1972) and his book o n Computer Power and Human Reason (\ 976). With particula r focu s o n numericall y controlled (NC ) machines , compute r aided design (CAD) equipment, and artificia l intelligenc e (AI) programmes, thi s led to a general critique of the technocratic hybris that exaggerated the power and capabilities of the new machines and programmes, and an emphasis on necessity and desirabilit y o f preservin g an d supportin g huma n "taci t skills" , "operato r experience", and human "purposiveness" as a central element in the new designs. In the early 1980s , thi s wa s t o have an important influence o n the establishment of th e UMIS T huma n centred lath e projec t i n England , th e workshop-oriente d programming (WOP ) projec t i n Germany, the UTOPI A projec t i n Sweden , an d the ESPRIT Huma n Centred CI M project . Thirdly, an important background condition to these two sets of developments was th e emergenc e i n th e 1960 s an d developmen t i n th e 1970 s o f a growin g movement for "alternative", "intermediate" , "soft" , "convivial" , and non-military forms o f technology and growth, in contrast t o the environmentally polluting, resource wasteful , sociall y harmful an d globally threatening forms of development characteristic o f classi c industrialism . Th e classi c criticism s ar e no w strongly associated wit h such names as the Club of Rome, Ernst Schumacher, Ivan Illich , and Amor y Lovins . In combinatio n with more radica l critique s of science , thi s "alternative" technolog y view inspired a greater degre e o f intellectua l interest in the political nature of science and technology and a social concern with the regulation of industrial "progress". After th e initial plethora of "technology assessmen t

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bodies" emerging in the early 1970 s in response t o the concerns o f environmental and workers movements, thi s led to a more widesprea d interes t in the creation of more "proactive " forms of intervention in technological direction. In some case s this led to direct link s being established betwee n worker s movement s and "green bans", anti-nuclear protests, "sociall y usefu l production " initiatives, etc.

6.2 Ke y National Influence s In combination all three sets of developments exerted an influence on the establishment and evolution of humanization of work programmes suc h HdA, particularly the firs t development . Yet , a s observe d i n comparativ e studie s o f wor k refor m programmes, a n understanding of different nationa l programmes depend s greatl y upon muc h o f th e natur e an d succes s o f thes e activitie s depen d upo n nationa l constellations o f industria l relations, institutionalize d attitudes , stat e structure s and civil servant interests (Auer et al. 1983) . In th e Germa n case , som e o f th e dominan t influence s on th e HdA/Au T pro gramme hav e bee n - th e key role o f th e Social-Democrati c part y (SPD ) i n establishin g the pro gramme i n 197 4 a s a "sociall y oriente d technolog y policy " tool wit h stron g trade union influence, and the later modification of that role under the influence of the conservative party (CDU ) fro m 198 3 onwards ; - th e strengt h o f th e Research an d Technology Ministr y (BMFT ) i n initiall y orienting activitie s towards th e extensiv e 10 0 million DM pe r annu m direc t promotion o f "human oriente d technologies " as well a s R&D int o health and safety conditions , an d it s ambivalen t attitude s t o th e programm e give n it s dominant emphasis on increasingly indirect funding of science and technology oriented toward s "non-social " internationa l competitivenes s ye t subordinat e commitment t o "socio-economically " oriente d goal s o f energy , environment and work reform ; - th e complex constellation of engineering consultancy, work psychologists and industrial sociologist s i n th e Germa n researc h an d developmen t syste m that , on the one hand, provided a scientific-technical basis fo r the programme and , on the other hand, infused i t with the disciplinary orientations and antagonisms from thes e sections o f the R&D system ; - th e extensive lega l syste m o f co-determination, workplac e healt h an d safety and inspectorates tha t both provided the preconditions for a substantial degree of employe e an d trad e unio n involvemen t in technologica l chang e an d i n a number of ways limited and restricte d tha t involvement (in particular through the separate sphere s o f activity of works councils and trade unions); - a production cultur e tradition and set of employee an d trade unio n attitudes that promote a relatively receptive attitud e to technological change and a cor-

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poratist structur e o f employe r an d employe e association s tha t enhance s th e ability of government, employers an d trade union s to negotiate th e design an d implementation of new technology an d work strategies; an d - th e post-war socia l modernizatio n pat h followe d by Germany throughou t the boom perio d o f the 1960 s and 1970 s as well as survivin g the economic prob lems of the early 1980 s - a strategy tha t involves government, employer s and unions co-operating i n the promotion of an economy strongl y oriented toward s international competitivenes s ye t accompanie d b y a se t o f institution s and programmes tha t cushion the social costs and adjustment to these processes.

6.3 Thre e Phase s of the Programme The history of the HdA programme's orientatio n and mechanisms can be loosel y classified int o three phases fro m 197 4 to 1982 , 198 3 t o 198 8 and 198 9 onwards , with each of these period s marke d b y governmental changes and/o r governmen t reviews of the programme . The first phase established th e overall direction and structure of the programme with a basic orientation toward protective action in the workplace through occupa tional health and safety research an d regulation (with the support of the Ministry of Labour ) an d th e developmen t o f ne w "huma n oriented " form s of technolog y and wor k (wit h the suppor t o f th e BMFT) . Project s ar e funde d within firms for the developmen t an d implementatio n o f improve d workin g conditions, usuall y involving external consultants wh o are responsible fo r the documentation of th e project i n transferable form. An extension upon this concept i n 197 7 wa s the establishment of "branch" projects involvin g employer and worker organizations in an industry working with experts on new technologies and forms of organization for th e branch (see Figur e 1) . A lesser degre e of funding i s given to fundamental research i n scientific institutions, and afte r 197 7 for the exclusive evaluation and diffusion o f th e programme s results . Sinc e 1979 , thi s ha s involve d the fundin g of union and employers organization s for diffusio n an d i n 197 9 the union s were funded t o establish Technology Advice Centres . As is the case with other BMFT programmes, i t is run by a policy group within the ministr y supported b y a n externa l administrativ e group o r Projektträger, in thi s cas e th e DFVLR . Th e ministe r ha s a specia l advisor y boar d t o advis e on th e developmen t of th e programm e staffe d b y equa l numbers of employers , trade unionist s and scientists . Eac h projec t applicatio n from industr y must b e presented b y management wit h the agreement i n writing from the works council (Betriebsrat) and , now further details on information and participation procedures. These proposal s ar e evaluate d b y exper t committee s i n whic h employer s an d unions ar e equall y represented. On e o f th e uniqu e feature s of th e programme' s administration, compare d t o other s withi n th e BMFT , i s th e degre e o f unio n

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participation, whic h als o involve s participatio n i n conference s t o discus s ne w plans for the programme . By the late 1970s, therefore, som e attention had been paid to diffusion problem s and measures t o assist employe e inpu t into the projects. However , i n 1979 , in the face o f risin g unemployment, some employe r oppositio n t o unio n involvement, and trad e unio n scepticis m abou t th e programme, th e BMF T followe d it s dom inant preoccupation wit h internationa l competitiveness i n removing the robotic s and flexibl e automatio n part s o f th e programm e ou t o f Hd A an d placin g the m in th e separat e Manufacturin g Technologie s programm e wit h les s trad e unio n involvement. Continuin g these emphases , th e second phase o f th e programm e followed fro m th e parliamentar y revie w an d chang e o f governmen t i n 1982 . A dominant emphasis wa s the establishment of a tighter link between humanization and innovation , with a stronge r focu s o n th e nee d fo r project s t o b e financiall y profitable. This wa s followed, not unsurprisingly, by a discussion o f the accounting procedures tha t should be used in such assessments wit h concern expresse d a t the overly narrow criteri a normally imposed i n judging humanization or organi zational changes . Durin g this period , other significan t change s wer e mad e i n the commitment to reorient project funding awa y from th e dominance of larger firms, restrictions against public sector proposals fo r local government, the decision no t to fund autonomous trade union and business association projects, and a limitation on the amount of "transfer research". The third phase o f the programm e bega n wit h parliamentary criticis m o f th e programme i n 198 7 an d culminated in a reorientation symbolized by th e chang e of nam e t o Wor k an d Technolog y (AuT ) an d th e participatio n b y th e Federa l Ministry o f Educatio n an d Scienc e (BMBW ) i n a programm e organize d "o n a broader understandin g of innovation and occupational safet y and health" (BMF T 1990b:24). The ke y emphasis wa s again th e importance o f uniting humanization with innovation concerns an d the need t o ensure adequate diffusio n o f the results of the programme (se e Tabl e 2 and 3). In this case, the change involve d a reduc tion i n th e fundin g give n t o a numbe r of occupationa l healt h an d safet y issues , the promotio n o f priorit y areas fo r th e programm e i n the developmen t o f innovative technologies an d systems integratin g people, organizatio n an d technolog y in a comprehensiv e an d preventio n oriente d innovatio n concept , an d a furthe r emphasis o n comprehensive projects as promotional tools (involvin g cooperativ e projects, branch-oriente d projects , an d transfer projects) . The "broad innovation concept", illustrated in the diagram below (see Figure 2), is a major emphasis of the new programme an d is well represented i n the priorities given t o "th e desig n o f softwar e i n keepin g wit h huma n need s an d workshop oriented contro l concepts" , "th e developmen t o f integrate d plannin g processes for a foresighted design of work and technology", th e "early inclusio n of all those acting a t plan t leve l an d representin g specifi c interest s i n th e developmen t an d testing of design solutions", an d a stress upo n the

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rapidly growin g interdependenc e withi n an d betwee n companie s (which ) makes i t all th e more necessar y t o design an d pla n processe s of change an d developmen t on a long-term and comprehensive basis . This applie s especially to personnel plannin g and t o the design of wor k and technology . Today man y companies lac k the method s an d instruments , skills and capacitie s t o accomplis h this . Especiall y i n areas i n whic h smal l an d medium-size d enterprises hav e to tak e th e initiativ e themselve s without bein g able t o simpl y follow th e example of big companies (BMFT 1990b:10) .

Employers Organizations and institution s

German Ministr y fo r Research an d Technology T

Trade union s an d institutions

Scientists

Program administration HdA consultation applications

project supervisio n

Professional organization s

Scientific institute s

research consultation planning o f pilot projects cooperation i n projec t implementation

consultation an d suppor t o f work s counci l j consu Itation an d support of managemen t

Figure 1: Outlin e of branch plant programme mechanis m Source: de n Hertog/Schöder (1989:35)

7 Ne w Technology Polic y Concept s i n the West German Humanization of Work Programm e 7.1 Overvie w A comprehensiv e examinatio n o f NTPCs i n the Hd A programm e woul d requir e extensive documentar y an d intervie w based researc h i n orde r t o determin e th e evolution an d amalgamatio n o f th e view s o f th e differen t participant s i n th e

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Table 2 : Diagra m o f changes i n Humanization of Work programme

1984

1985

1986

humane use of new technologies i n an office environmen t

humane design of working conditions in forging industry

humane design of working conditions i n coal mining

humane use of new technologies i n production

humane design of working conditions in transportation industry

fundamental researc h and issues of general relevanc e t o the HdA programm e

humane design o f working conditions in foundries

working conditions and health of worker s reduction of noise in working health protection a t workplaces wit h new information an d communication technologies risk of cancer at the workplace

Source: de n Hertog/Schöder (1989:37)

programme, an d the background of these view s within employers organizations , the trad e unio n movement , th e BMF T officials , an d th e researc h community . Although suc h a systemati c stud y ha s no t bee n carrie d ou t som e genera l com ments can be made her e on the basis of experiences i n the programme, selectiv e interviews, programme review s and an assessment o f the literature. The programme began with the fourfold objectiv e of: developing safety norms, minimum standards for machinery and work settings; developing humanized work technologies; developin g paradigm s an d model s fo r wor k organizatio n and jo b design; and the distribution and application of scientific knowledg e and practica l experience. I t was generally accepted, however , that most of the funds wer e to be allocated t o ensurin g healthier work conditions by minimizin g health risk s and stressful wor k situations (Wilpert/Quintanilla 1984) . The interpretatio n place d upo n thes e objective s b y man y commentator s i s somewhat contradictory , reflectin g in part th e conflictin g experience s tha t led to the programme's establishment . On the one hand, the period appear s t o be one of optimism. Changes in health and safety and consultation legislation imposed new requirements upo n employers. Th e 197 2 Works Constitutio n Act legall y bound

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Table 3 : Tabl e of the Work and Technology programme priorities (as per July 1989 ) Status

Basic principles/cross-selec tional issue s

Expiring

Production

Services

Reduction/Elimination of stress factors and development of new working structure s in the clothing industry Reduction/determination of stress factors & developmen t Improvement o f workin g conditions in the joiner's craft

Reduction/Elimination o f stress factors i n the hote l

Taken ove r fro m the HdA programme an d updated

Research o n stress and strain factors (e.g . noise , vibrations , combined an d mental stres s factors) Working conditions an d health Carcinogenic risk s a t th e workplace Allergic reaction s an d diseases Software desig n i n accordance with human needs Holistic planning processes including extende d profitability calculations Dissemination and implementation o f ne w scientific finding s and operating know-ho w including accounting Programme-related researc h

Noise abatemen t usin g the trade industr y and the sheet metal processin g industry as companies Application o f new technologies i n production i n keeping wit h human need s Improvement o f workin g conditions i n forging industry Improvement o f working conditions in the foundry industry Improvement o f workin g conditions i n th e minin g industry Application of new assembl y line technologies i n accordance with huma n need s

Serving the design an d application of ne w technologie s in offices an d administratio n i n accordance wit h human need s

New/Planned Simpl

e measurin g proces s for noxious wor k substance s Health protectio n a t th e workplace i n air conditioned rooms Work oriente d design , healt h protection an d acquisitio n of skills when ne w technologie s processes and material s use d Work-related design o f networked systems (CIM , Logistics. JIT, etc. ) Work oriented concept s o f organization, acquisition o f skills and staf f managemen t Concepts of the acquisitio n of skills by socia l group s o f employees Demographic tren d an d effect s on workin g conditions and employees structure s

Application o f ne w technologies i n th e printing industry i n accordance with human need s Improvement of workin g conditions i n the foo d industr y and i n agriculture Transfer of design know-how i n certain industrie s taking th e example of the sho w industry Planning o f workin g conditions i n craftsmen' s business i n accordance with human needs

Design o f ne w technologie s i n commuter traffi c i n accordanc e with huma n needs Planning of working conditions of offic e worker s i n accordanc e with huma n needs Planning of working condition s in th e trad e i n accordance wit h human need s Improvement o f workin g conditions i n nursin g and providing care for people wh o are old, sic k or who have disabilities

Source: BMF T (1990b:21)

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Organization

Linking man ana technolog y by the design and development ,of an d participatio n in organizations Development, selection and application of technology

Design o f work and technolog y in accordance with human needs by broad innovation , and prevention

Chancesand conditions of acquiring skills

Health protectio n and occupationa l safety an d health

Figure 2: Diagra m of broad innovation concepts of the Work and Technology programm e Source: BMF T (1990b:7)

employers (paragraph 90 ) to inform work s councils at the "appropriate point " of planned change s i n technology an d wor k organization, and paragrap h 9 1 state d that works councils could modify or stop any changes which went "significantly" against th e "accepte d findings " o f wor k science . I n addition , afte r givin g its approval to quality of working life initiatives, the coordinating German trade union body (DGB ) supported th e HdA a s an important proactive initiative in this area. Moreover, th e recentl y electe d Social-Democrati c part y (SPD ) establishe d th e programme as part of a "socially oriente d technology policy", itsel f an important feature o f a "societ y oriente d modernization " strateg y t o improv e international competitiveness an d cushion the social cost s whil e pursuing a "humane growth path" (Naschol d 1980) . Moreover , i n th e fac e o f implementin g rationalization measures t o increas e produc t quality , flexibilit y an d deliver y times , employer s organizations appeared t o recognize the importance of addressing the human and organizational issues that this raised. On the other hand, however, there had been long debates withi n the trade union movement before committing itself to action in the area of promoting alternative forms o f work organization. The background in the early 1970 s led to the sprea d of "crisis " languag e in respons e t o th e oi l shoc k o f 1973 , sluggis h worl d mar kets, the revaluation of the German Mark, etc. Moreover , earlie r strik e activities

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peaking i n the "September Strikes" of 196 9 were part o f a multidimensional reaction agains t rationalization and the worsenin g of labour conditions , a reaction that include d passiv e resistance , absenteeism , greate r labou r mobilit y etc. Thi s phenomenon, particularl y noticeable i n assembl y industrie s an d i n man y jobs fulfilled b y a growin g numbe r of "gues t workers" , le d t o a n importan t chang e in th e attitud e of man y workers. Face d b y unemployment , stress an d threat s t o incomes an d qualifications , ne w technolog y wa s n o longe r see n a s neutral , and the desire fo r mor e human e working conditions became a much higher priority (Brugmann 1982) . This change could, however , be see n a s a defensive respons e to the "job killing " an d "dehumanizing" effects of new technology, the latter associated wit h reduce d qualificatio n requirement s and physica l problems. I t wa s emphasized i n man y cases tha t the initiative s t o improv e work condition s wer e employment-creating i n th e fac e o f th e unemploymen t consequences o f rapi d rates o f productivity increase (Markovits/Alle n 1981) . In the light of both these sets of ideas and experiences, th e NTPCs tha t emerge d should be seen mor e a s a compromise between , o n the one hand, a grudging acceptance o f th e nee d fo r chang e an d defensiv e reaction s t o th e huma n costs of rationalization, and , o n th e other , mor e optimisti c interpretation s of ho w thes e problems coul d b e addressed i n the adoption of a more proactive and preventive approach t o techno-organizationa l desig n an d implementation . B y th e tim e o f the firs t major formal re-evaluation of th e programm e i n 1982/83 , however , th e optimism concernin g the capabilitie s of th e programm e ha d bee n considerabl y weakened. For employers , the economic effectivenes s and consequent diffusio n of many of the projects had neither been show n nor realized. For trade unions, the hopes fo r dramati c increases i n participation an d consultatio n over chang e ha d also no t bee n realized , eithe r i n the workplac e or i n othe r governmen t technol ogy programmes . Fo r scientists an d researchers involve d in the programme, th e difficulties o f rea l interdisciplinar y work an d meaningfu l collaboratio n betwee n researchers, union s and managemen t ha d le d to less than successfu l results . For the programme management, the controversial nature of the programme, the problems observed b y the participating groups, and the lack of co-operation fro m othe r programmes i n the BMFT (even the removal o f the robotics/flexible automation features fro m th e programme), all represented a far-from-satisfactory outcome . In the face of these difficulties, th e unions adopted a more offensive stanc e best represented in the IG Metall Action Programme. Sceptical o f the significant effec t of the HdA programme as it stood, a n emphasis was placed on the need for a more radical extension of trade union influence and social factors considerations over the broad rang e of technology policy. Moreover, greate r stres s was placed o n worker and union control over workplace negotiations, as well as the use of industry level and regional collective agreements to prevent downgrading with new technology, reduce working hours, etc. In terms of direct impacts on the programme, employers demanded that projects b e selected wit h economic viabilit y considerations mor e clearly i n mind . They ha d bee n influentia l i n removing the robotics an d flexibl e

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automation component s fro m th e programm e an d wer e no w partl y responsibl e for th e financin g o f th e researc h mad e b y th e scientist s a s par t o f th e projects . Despite the substantial criticisms made of the programme by both sides, however, there wa s an overriding agreement that it be allowed to continue. A similar degree of agreement on the continuation of the programme was also the outcome of an equally critical review of the programme i n 1987/88 , resulting in th e chang e o f nam e an d directio n o f th e programm e i n 1989 . Th e majo r reorientation a s described abov e involve d a strong focus on NTPCs; however , the form tha t these tak e will be strongl y influenced b y the comple x an d conflicting pressures tha t combine to make u p and influence the HdA/AuT programme . 7.2 Th e Complex Nature an d Tensions within NTPCs Over the differen t phase s o f the programme, th e broad objectiv e hav e no t bee n substantially change d - th e orientation i s towards the combination of "humanization" and "efficiency" consideration i n preventive desig n to avoid the "costs" of rationalization (du e to increased stress , other health and safety considerations, etc.) an d th e proactiv e desig n o f ne w system s t o improve workin g condition s as a key factor i n 'broader' innovatio n concepts. I t i s possible, however , t o de tect particularl y in the more recen t change s a n increasing emphasis on the latter priority. Within thes e broa d objective s man y different strategie s ar e possible, encour aged by the conflicting character o f many of the programme's goals . Concernin g the basic assumptio n of the compatibility between "humanization " and "productivity", i t is clearl y possibl e t o accep t a degree of overla p betwee n attentio n to human "needs " an d reduction s i n cost s du e t o worke r resistance , absenteeism , insurance costs , etc . o r meaningfu l participation o f th e workforc e i n ne w sys tem desig n an d th e spee d an d effectivenes s o f implementatio n (throug h mor e effectively utilizin g 'tacit ' skills , incremental innovation and development of the system, consideratio n o f veste d interest s an d consequen t suppor t fo r th e ne w system, etc.) . Moreover , th e opportunitie s to exploi t these opportunitie s can be encouraged b y shift s i n marke t conditions , technologica l trends , th e establish ment of model examples of successful achievements, the creation of participatory techniques, the design of "broader" investment costing and planning tools, etc . On the other hand , occupational, health and safety measures ca n be extremely costly; an d participatory/responsibility-oriente d technology strategie s ofte n in volve length y an d expensiv e processe s o f training , consultation an d organiza tional change. Marke t condition s and technological trend s are not all On e way' in a directio n tha t make s suc h commitment s necessary, an d th e imperative s of competition may make many activities in this area a luxury that many firms either cannot afford o r cannot effectively implemen t given the realities of contemporary organizational structures and cultures.

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9

As a result of thi s complex combinatio n of overlap an d conflic t between hu manization and efficiency considerations , often in situations of uncertainty about "real" costs and benefits, th e extent to which either theme i s emphasized wil l always be a matter of negotiation and interpretation between different interests . It is not surprising, therefore, that despite the presence of different trends and emphases within th e Hd A programme , eac h phas e o f it s development i s characterized b y compromise o r balancing between Optimistic ' an d 'pessimistic ' viewpoints . Of particular significance in this regard has been the influence in shifting the balance of, firstly , th e coming t o power o f th e SP D an d th e establishmen t of corporatis t structures an d lega l requirement s tha t provide conditions fo r forcin g employers to take actions which they are then pressured t o 'make ' profitable ; and secondly, the presence of economic crisis and unemployment problems tha t focus attention of both employers and unions on cost reduction strategies and income/job protection; and, thirdly, new rationalization concepts t o meet economic challenges that either threaten or enhance workforce skills and autonomy in the workplace. In additio n t o this general ambiguity , there i s a fundamental conflic t between the stated objectives of the HdA/AuT programme to effectively promot e new humanized forms of work and the restrictions upon the programme due to continued employer domination of investment and, consequently, innovation in a fundamentally privat e economy. A s frequentl y observed, Hd A fund s ar e relativel y small compared t o overall privat e industry R&D ; Hd A project s ofte n onl y involve the workforce lat e on i n the innovatio n process, being use d b y firms to obtain public mone y becaus e o f economi c difficultie s rathe r tha n humanitaria n interests. Projects ofte n collapse , frequentl y afte r the pre-phase, an d experiments ar e often restricted o r closed dow n in the face of changing investment strategies. Whil e it is possible to point to numerous important measures take n by the HdA/AuT programme to address these problems, this serves to illustrate rather than undermine the fundamenta l point : th e activitie s of th e Hd A programm e hav e to be see n i n a continual state o f tension, forced to accept the dominance of private enterpris e investment and innovation strategy yet using direct promotio n measure s to ofte n 'indirectly' influenc e these strategies i n directions conducive to the humanization of work. A thir d conflict withi n th e programm e concerns th e disproportionate balanc e between th e optimistic and grandiose aspiration s of the programme an d the relatively underdevelope d implementatio n of these aspiration s in practice. Thi s feature o f th e programm e ma y b e roote d i n it s minorit y and symboli c rol e withi n the BMFT, combined with the substantial difficulties tha t face such a programme. An illustratio n of such difficulties is , for example, that whereas workers possess "rights" (t o information , consultation, etc.), the y ar e ofte n lackin g in "ability " to tak e u p thes e right s (e.g . lac k o f time , inadequat e knowledge an d expertise , etc.); an d wher e the y ar e funde d b y programme s suc h a s Hd A t o enhance their "abilities", they do not have sufficient "rights " to utilize them effectively (e.g . in meaningful consultatio n over investment strategies).

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as CJ

D

3

03

(Λ I-,

ω

α,

ε

ω

Positive Attitudes

Negative Attitudes

Comprehensive job security , protected wor k capacities (healt h qualification), participatio n and control a t firm and governmen t level, transparency o f democrati c social structures. Coordination o f workers activitie s (works councils, trade unions, with researchers, with government officials, etc.) , the development of trade union transfer mechanisms

Intensification o f work masqueradin g as rationalization, elimination of jobs through increased productivity , participation as 'ritual' , rigidities in payment systems restricting financial gains, insular projects eithe r no t taken up elsewhere or with broader negativ e consequences i n polarizing the workforce, increasin g subcontracting an d undermining of trade union strength, etc .

Profitable workplac e specifi c an d worker specifi c work structures, flexibility through skil l and responsibility amongs t the workforce, improve d qualit y through delegation o f inspection, etc., increased machin e utilization and reduced throughpu t time, legitimating function , etc .

Unprofitable project s costs , intrusions into managerial prerogatives, excessiv e control t o recalcitrant workers an d trade unions, worker an d trade unio n defensiveness, humanizatio n ideolog y encour aging excessive expectation s

Socio-technical experiments possi ble with gains to both employer s and workers, numerou s small t« improvements achieved, practica l c ο examples establishe d o f working c systems, increase d awarenes s of D employers an d workers concernin g the beneficial and harmful effects u Ό of new technology, encourage S ment of applied scientifi c researc h through participation i n firm projects ke y aspect o f social mod ernization strateg y

Undeveloped 'torso ' character o f the programme, lac k of diffusion o f results, any researcher plans on projects no t implementable, lack o f national and international publications, limited views of many trade unions, difficulty o f adapt ing to the realities of employer control , unrealistic hopes fo r chang e

Figure 3 : Attitude s of main participants of the Humanization of Work/Work and Tech nology programm e * Thi s exclude s th e opinions of the scientific communit y and the different advi sory boards which should be included in a comprehensive summar y of more or less influentia l participants .

New Technology Polic y Concepts 15

1

An illustratio n o f th e comple x tension s characterizin g NTPC s withi n th e HdA/AuT programm e ca n b e provide d b y a lis t of th e conflictin g perspectives brought t o th e programm e b y a numbe r o f th e leadin g participant s (Figur e 3) . Although this is somewhat simplistic, it serves a s summary important illustrative device i n showing the negotiations over the nature and meaning of NTPCs . It i s no t surprising , therefore , tha t a s on e o f u s ha s commente d earlier , th e programme remain s i n a 'tors o character' wit h many humanization concepts no t fully developed - a phenomenon that emerges not because of the brief history of the programme, the friction points in intra and inter-departmental negotiations, or even uncertainty concerning the future development of the programme, but rather in the continual unstable compromise between "humanization " and "productivity", an d the dominatio n of entrepreneuria l strategie s i n resolvin g these conflict s despite the programme's extensiv e activities (Naschold 1980) . 7.3 Th e Impac t and Significance o f the NTPCs In direc t contras t t o functionalis t approache s tha t over-emphasiz e th e degre e to whic h politics i s adapte d t o th e 'requirements ' o f techno-economi c regimes , the histor y o f th e Hd A programm e reveal s th e extrem e difficultie s involve d in implementing a human oriented "comprehensiv e innovation " approach. Som e of the key problems have already been mentioned, including domination of economic investment strategies by management with little direct influence from trade unions and state programmes; the difficulty o f integrating across programmes both within and beyond the BMFT; and the difficulty o f diffusing th e results of the projects . 7.3.1 Managemen t Dominatio n of Investment Strategies At programm e level , this factor i s clearly apparen t i n the nee d fo r managemen t to apply for programme mone y for a firm project, despit e th e need fo r agreemen t from th e works council. In an attempt to increase the influence of works councils on project , th e Hd A programm e requeste d fro m th e lat e 1970 s o n tha t a mor e detailed se t o f informatio n provision an d consultatio n provision s be provided . In practice, however , these provision s are difficul t t o implement . One compara tive researc h projec t o n informatio n disclosure i n genera l foun d i n thre e ou t o f four Wes t Germa n companie s studied , that the firs t information was give n only after severa l year s o f managemen t plannin g (Moore 1984) . Despit e th e forma l disclosure provision s of th e 197 2 Work s Constitutio n Act, sever e restriction s are impose d o n trad e unio n influence b y th e followin g factors: informatio n can be withheld on lega l grounds; conflicts an d communication between centra l an d plant work councils can cause problems, as well as the lack of integration between works council s an d trad e union s which ar e legall y unabl e to interven e i n plant level negotiations . An additiona l and crucia l facto r i s observed i n a study of th e

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German machin e tool industry : a key problem wa s no t s o much the absenc e o f information o r consultatio n opportunities , but rathe r th e inabilit y of th e work s councils t o utiliz e the informatio n and tak e advantag e o f th e opportunitie s du e to lac k o f time , expertise , etc . (Hildebrand t 1987) . I t i s no t totall y surprising, therefore, tha t an analysis of 71 collective agreements i n West Germany (all recognized by the unions as leading examples) revealed tha t scientific knowledge of new form s o f wor k organizatio n an d humanizatio n of wor k ideal s wer e hardl y ever drawn upon (Pornschlegel/Schiitte 1981) . An additiona l factor revealed i n reviews of the Hd A programm e i s the extent to whic h particula r Hd A project s ca n b e see n a s 'moments ' i n managemen t investment strategies as many firms used the money as part of prior cost reducin g rationalization strategie s (Altmann/Diil l 1980) , o r ende d th e projec t afte r th e 'pre-phase' a s it became ou t of line with the timing of firm investment strategies (Schallock 1991) . 7.3.2 Lac k of Programme Integratio n As observe d i n th e I G Metal l Actio n Programme , th e HdA/Au T programm e operates wit h less tha n 2 % o f federa l R& D funds . I f i t is , therefore , t o hav e a significant impac t on shapin g innovation, it requires integration wit h other stat e programmes. Th e placin g of the robotics an d flexible automatio n components of the programm e i n th e separat e Manufacturin g Technologies programm e i n th e late 1970 s indicate d a lac k o f BMF T commitmen t to thi s task . Moreover , th e increasing direction of BMFT funding toward s indirect R&D funding lessen s th e possibility of extending HdA influence through integration with significant direc t R&D funding programmes . The lack of integration with other programmes has long been a major criticism directed agains t th e Hd A programme , an d attempt s hav e bee n mad e t o addres s this issue . I n the mid-1980s , th e competent Hd A pane l a t the BMF T outline d a 20-point humanization and innovation plan that attempted to outline a "comprehensive notio n o f innovation " that woul d provid e th e theoretica l basi s fo r this integration. The BMF T has generally pointe d t o the communication that occur s at th e leve l of th e politica l community, relevant associations, programm e targe t groups, and working level contracts within the BMFT. In the mid-1980s, links had been formed, for example, in the areas of ergonomics and occupational health and safety (reacto r safety , the dange r o f ne w energ y technologies , lase r techniques , agricultural production an d forestry, etc.), technology assessmen t (applie d biol ogy and biotechnology, ne w manufacturing technologies), and within the areas of public transit and the ship of the future (BMFT 1985) . During and since that time, further informa l links have been develope d wit h the Manufacturing Technologies Programme an d th e othe r area s o f 'proactive ' technolog y assessmen t an d tech nology design . However , despite the recent inclusio n of the Federal Ministr y of Education an d Scienc e i n the AuT programme, ther e has no t been an y develop -

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ment of uniform criteria fo r identifying relevant practices i n other programmes i n the BMFT or other ministries; and, despite the development of these and a number of othe r technique s fo r improvin g the diffusio n o f results, inter-programm e col laboration remains weak. This may be a factor influenced by the more traditional technology ministr y attitudes of the BMF T at the beginnin g of the programme , the continuin g fundamental commitment o f th e departmen t t o improvin g international competitiveness , an d a mor e recen t emphasi s o n indirec t an d indirec t specific method s of promotion. As represented i n a recent respons e b y the BMFT to a question i n the Bundestag o n R& D policy , public participation, technology assessment, etc. , th e AuT programme ma y however come to be accorded a more important role (BMFT 1990a) . 7.3.3 Problem s o f Diffusio n The difficulties of diffusion hav e been strongly emphasized b y both employers and trade unions . Academic critiques of the programme base d o n project evaluations, interviews an d publicatio n assessment s hav e accuratel y pointe d t o th e lac k o f published result s an d th e absenc e o f documente d rea l interdisciplinar y work o r significant influence s on th e shapin g of technolog y (Dankbaa r 1987) . The y al l point to projects tha t reveal this situation. The additional point has been mad e that these problem s hav e bee n exaggerate d b y th e political/disciplinar y boundarie s in th e Germa n scientifi c communit y i n thi s area , an d th e ill-preparednes s o f this communit y fo r th e larg e amoun t o f financ e an d activit y generated b y th e HdA programme . Mor e importantl y for trad e union s and employers , however , have been , firstly , th e failur e o f th e project s t o provid e rea l organizationall y successful exemplary models of efficient humanized work solutions and, secondly, the lac k o f method s fo r actuall y diffusin g th e result s tha t hav e bee n achieved . Employers hav e pointe d mainl y t o th e lac k o f clea r economi c succes s o f th e various projects, an d the absenc e o f suitable documentation for diffusion . Trad e unions hav e emphasize d th e lac k of knowledg e o r expertis e o f work s councils, and the major difficulties involve d in informating and training local delegates an d works council members i n the nature, consequences an d available alternatives to new forms of technology and work organization. I n order to assist in the diffusio n process, th e Hd A programm e ha s finance d bot h employer s organization s an d trade union s to diffus e projec t results . I n th e cas e o f th e trad e unions , i n 1979 , the DG B an d I G Metal l wer e funde d t o se t u p Technolog y Advic e Centre s t o assist i n this task. In addition many projects hav e extra mone y fo r the writing up of the results i n accessible form . More significantly , the present Au T programm e is strongl y committe d t o th e furthe r developmen t o f branc h oriente d project s involving employers organization and trade unions in an industry sector rather than individual firm projects, co-operative project s combinin g technology developers , users, public institutions, employers associations, etc., and comprehensive transfer

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projects involving taking examples of projects and transforming them into specific acceptable for m for action in other projects. Despite th e importance of these initiatives, however, severe diffusion problem s still remain. If, as the HdA/AuT programme has long assumed, criteria employed by firm s ar e to o narro w i n judging the economi c efficienc y o f 'humane ' wor k solutions, i t i s difficul t t o se e ho w market-base d transfe r mechanism s ca n b e successful. Whe n thi s i s adde d t o th e lac k o f diffusio n o f pas t Hd A results , including thei r technique s fo r 'broader ' concept s o f innovation , the diffusio n process appears t o remain an extremely problematic issue . 7.3.4 Indirec t Benefit s It ha s bee n accuratel y observe d i n a numbe r o f assessment s o f th e Hd A pro gramme tha t the direc t quantifiabl e benefit s of th e programm e ar e probabl y o f less significanc e than the substantia l indirect benefits that hav e emerged. Apar t from concret e gain s i n th e occupationa l healt h an d safet y area , smal l techno logical/organizational improvements , an d som e usefu l practica l examples , th e programme has provided an opportunity for a large number of work scientists to obtain industria l design experience. Th e subsequen t creation o f a 'humanization of wor k establishment' bot h knowledgeabl e i n theor y an d practic e i n thi s are a and institutionally and professionally committed to the furtherance of humanization goals may come to appear a s a significant achievement as different countries struggle to define, experiment and realize NTPCs . I n addition, the problems ex perienced b y the programme and many of the solutions established ar e the result of the difficult bu t necessary experience s associate d with the implementation of a state-centred social-democrati c modernizatio n process. By making the opportu nities and difficulties clea r and by creating opportunities for new understandings and link s to be formed betwee n scientists , trad e unionist s and ministr y officials, the Hd A programm e ma y hav e mad e a n importan t contributio n to th e Germa n social modernizatio n strategy. These activitie s and communities may themselves prove to be an important carrier o f new technology policy concepts, o r at least a significant influenc e i n the shaping of the futur e industria l culture.

8 Conclusio n Some relativel y clea r theme s emerg e fro m th e histor y o f th e Humanizatio n of Work programme . Firstly, ther e was a distinctive movement from a phase of 'humanistic ' radical perspective t o a more busines s oriented accomodativ e era, governe d b y the spe cific conditions of these time periods. Amongst the most significant influence s on the earlie r phas e are , firstly , th e importanc e of a social-democrati c governmen t

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in a n economic boo m perio d i n promoting humanization concepts tha t extende d beyond th e far more restraine d an d sceptical acceptanc e b y unions and business ; and, secondly , th e earl y implici t shift fro m a mor e traditiona l demand-oriente d Keynesian approach toward s socia l modernizatio n t o a more supply-oriente d approach t o sociall y oriente d economi c development . Th e declin e o f th e radica l supply oriente d approac h coul d b e viewe d i n eithe r classi c pessimisti c Marxis t terms a s the inevitabl e weakening of a radical stat e programm e o r i n more opti mistic Weberia n term s a s a movement from a "charismatic" foundin g era to one of "routine" bureaucratic implementation of detailed application s of a number of the early ideas . I t is perhaps mor e appropriate , however , t o poin t to the gradua l reaching of a compromise o r 'settl e point' betwee n business , trade union s and a new conservative political party, influenced by such conditions as a less favourable economic an d employment climate, a lack of commitment by trade unions in committing substantia l financial and organizationa l resources, a failur e o f scientifi c partners t o creat e a n integrate d an d cumulativ e set of finding s an d experiences , and a changed projec t management 4 - a combination o f events that resulted i n a decline in project dynamism and innovation and a more accomodativ e (yet , in the situation, realistic) push for "comprehensive innovatio n concepts". Secondly, th e development of the programme has to be seen in its particularity as a different typ e of activity to that of, for example, the Swedish Work Environment Fund. I n contrast t o th e Swedis h situation , the programme i s more clearl y stat e dominated, directe d mor e strongl y b y governmenta l ministrie s than th e labou r market partners. I n addition, the programme, wit h substantial spending in exces s of on e billio n DM , ha s contribute d a large r amoun t directl y toward s researc h and developmen t i n wor k humanization . In th e process , i t ha s supporte d an d been influence d by a muc h large r scientifi c research establishmen t i n the wor k humanization area . Th e programm e ha s als o bee n substantiall y influence d b y the politica l segmentatio n o f Wes t Germa n ministrie s an d thei r representatio n on th e programme . Firstly , th e participatio n b y th e Labou r Ministr y an d th e BMFT has been important in ensuring the strong health and safety and technology orientations of the programme, an d ne w developments ar e to be expected i n the education an d trainin g area a s th e respectiv e ministr y has no w bee n integrate d into the programme. Secondly, the direction of research an d project proposals has been influence d bot h b y th e spendin g patterns o f a technology ministr y that ha s committed substantial funds to the machine building and larger industries and the disciplinary orientations and strategic focuses of the range of powerful Fraunhofer Institutes and psychology, sociolog y an d engineering research centres . Thirdly, th e course o f the programme illustrate s a number of points about such technology polic y initiatives : firstly, the autonom y o f th e politica l proces s (i n this cas e represente d i n th e stron g influenc e upo n th e programm e o f th e SP D and the n th e CDU , an d th e reorientatio n o f th e programm e afte r parliamentary criticism i n 1987 , tha t itsel f followe d shortl y afte r parliamentar y reaffirmatio n of th e programme' s activities ; secondly, th e differenc e betwee n debate s a t th e

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ideological leve l an d thos e a t th e projec t level , although w e hav e concentrate d very muc h i n thi s discussio n o n th e mor e ideologica l level , a mor e systemati c analysis of the projects themselves is required to determine the real influenc e and direction o f the programme ; and , thirdly , the central significanc e in programm e orientation o f practica l implementation , fo r example , th e rulin g tha t busines s partners t o programmes tak e part responsibility for paying for scientific research , the decision t o not contribute so much funding t o large companie s wit h the mos t powerful trad e union s more abl e and committed t o transferring what they see as successful loca l experiments , th e significanc e o f labou r marke t institution s and legislation in enabling or restricting the programme's rang e of manoeuvre, and the difficulty o f ensurin g adequate diffusio n o f promisin g experiences i f immediat e productivity gain s are no t apparen t or existin g market measure s o f productivity are being questioned . What, however, are the implications of these experiences fo r the understanding and promotion o f NTPCs? Firstly , it is necessary t o go beyond identifying NTPC s as either a profound threat to work humanization or as the active creator o f a 'new world o f work'. It is more appropriat e t o recognize th e necessarily comple x an d conflictual characte r o f such concepts, an d the potential that various aspects hav e for the improvement o f working conditions. Those elements that are selected an d promoted wil l b e directl y relate d t o ministeria l and part y politics , th e strengt h and strategic orientation s of industrial associations, sectora l industria l character istics and strengths, the research an d development syste m an d the orientations of scientific-technological institutions , patterns o f industria l relations and skil l formation, etc. Secondly, the funding o f direct promotion programmes, even as large as the German Humanizatio n of Work programme, ar e still reliant for their effec t on the operations o f man y such 'indirect ' a s well as 'direct ' influence s on path s of workplace innovation, and any design of such programmes tha t underestimate s this fact will inevitably result in disillusionment and ineffective promotion activ ities. Thirdly , if the traditional limitations of work reform programme s ar e to be addressed an d the Japanese challenge effectively met, new programme forms need to b e develope d tha t integrat e direc t promotio n measure s mor e effectivel y wit h broader educatio n an d training , industrial policy, technology transfe r an d R& D measures an d concerns. A s emphasized, thes e nee d t o be adapted t o specific national circumstance s rathe r tha n importe d a s a "universa l model" . I n short , th e success o f NTPCs will not only be based o n their 'radical' introductio n of socia l considerations int o technology policy, although the recognition and promotion of techno-organizational innovation concepts i s of major significance. It will, rather, centrally depend o n recognizing the socially-located characte r o f such technolog y policy programmes an d their supportive (or non-supportive) context, and building upon th e resource s availabl e t o facilitat e th e promotio n o f rationalizatio n paths that conform wit h cultural aspirations for improved working conditions.

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Notes [1] Als o note th e central emphasis place d o n ne w visions of comparativ e advantage an d business success. Fo r the BMFT, as outlined in their 1988 annual report, "I n the world of work , we no w have t o an increasin g extent the activ e participation of the user s of technology, because employees have to combine expertise i n the new technology with experience and knowledge in the tasks that are to be performed wit h this technology. A lead in expertise wit h regard t o this 'knowledge of integration' i s of great importanc e for ou r competitiveness , because i t cannot s o easily b e mad e u p elsewhere wit h th e aid o f just a fe w specialists " (BMF T 1988:75) . I n additio n there i s de n Herto g an d Schöder's observatio n tha t "On e ha s onl y t o refe r t o th e mos t recen t volume s o f the leading business journals i n order t o recognize th e dominant role attributed to the organization and the people working within it. These are not hazy socio-scientific pleas for 'human-centre d technologies' , bu t learnin g experiences base d o n har d practice " (Hertog/Schöder 1989:2) . [2] Thi s i s strongl y supporte d b y th e preliminar y information fro m th e contemporar y HdA/AuT revie w o f CI M Gestaltungswisse n co-ordinated b y th e Fraunhofe r IPK , Planungstechnik, West Berlin (Schallock 1991) . [3] Se e th e serie s o f article s b y th e grou p Hilar y Steedma n an d Kari n Wagner , D.W.M.N. Hitchins , S.J. Prais , Valeri e Jarvis an d A . Dal y i n th e National Institute Economic Reviews o f Februar y 1985 , Novembe r 1987 , Ma y 1989 , an d Novembe r 1989. [4] Dr . Lorenzen , th e hea d o f th e programm e managemen t at tha t time , wa s strongl y instrumental i n developing an d publishin g the idea s an d mobililizin g th e suppor t of the advisory groups for comprehensive innovation concepts.

References Altmann, N., R. Dull (1980) Neue Formen der Arbeitsgestaltung un d Arbeitsorganisation in der Bundesrepublik Deutschland, Munich : Institut für Sozialforschung. Auer, P. (1983) Arbeitspolitische Reformen i n Industriestaaten - Ei n internationaler Vergleich, Frankfurt/Main, Ne w York : Campus. Badham, R . (1990 ) Th e Huma n Centre d Desig n Constituency , Workin g Paper , Berlin : Fraunhofer IPK. Badham, R. (l 991 a) Introduction, in: Artificial Intelligence an d Society 4 (5): 1-14 . Badham, R. (1991b ) Anthropocentric Systems an d the Australian Production Culture, in: F. Rauner, K. Ruth (eds.) Anthropocentric Systems and Production Cultures, unpublished report to EC-Fast, Bremen : EC-FAST, 250-272 . Badham, R., K.-D. Lennartz (1990) Some Notes on the Machine Tool Industry/Automobile Industry Developmen t Bloc k i n Wes t Germany , Discussio n Paper , Berlin : Fraunhofer IPK. BMFT (1985) Reply t o a Question i n the Bundestag, Bonn: BMFT . BMFT (1988 ) Annual Report: English Translation, Bonn: BMFT . BMFT (1990a) Answer to the Federal Government, Drucksache 11/6391 , Bonn: BMFT . BMFT (1990b ) Research an d Development Programme 'Work an d Technology', Bonn : BMFT.

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Boyer, R. (1990) New Directions in Technical Change, in: OECD (ed. ) New Directions fo r the 1990ies , Paris: OECD , 1-45 . Brugmann, W . (1982) Einkommenserhöhunge n werden ers t a n vierte r Stelle genannt , in: Frankfurter Rundschau, \ 5 January. Couchman, P . (1989a ) Openin g Blac k Boxes : Th e Socia l Dimension s o f Scienc e an d Technology an d their Relevance t o the Current Polic y Debates , in : NZ Science Review 1-3(46): 1-13. Couchman, P . (19895) Technology an d the Australian State: Th e Changin g Politica l Discourse on Technology in Australia 1975-1985, Doctoral Thesis, Wollongong: University of Wollongong. Cooley, M . (1972) Architect o r Bee?, London: Abacus. Cooley, M . (1990) Comment, in: H. Rosenbrock (ed. ) Designing Human Centred Technology, London: Springer , 24-37. Dalum, B . (1990 ) Nationa l Systems o f Innovatio n and Technolog y Policy : Th e Cas e o f Denmark, paper presented t o the Workshop on "Socially Oriente d Technology Policy" , Vienna: Institute for Advanced Studies. Dankbaar, B . (1987 ) Socia l Assessmen t o f Workplace Technolog y - Som e Experience s with the German Program 'Humanizatio n of Work', in: Research Policy 10(16) : 45-58. Dickson, D. (1984) The New Politics of Science, New York : Pantheon. Ebel, K.-H . (1990) Computer-Integrated Manufacturing: Th e Social Dimension, Geneva: ILO. Edquist, C, H. Glimell (1989 ) Swedis h Frontier s o f Change - A Guide to the Impact of New Technologies, Wor k Designs an d Management Practices, Repor t prepare d fo r the Directorate for Social Affairs , Manpowe r and Education, mimeo, Paris: OECD. Edquist, C., B.-A . Lundval l (1989) Comparing Smal l Nordi c System s o f Innovation, paper presente d t o th e semina r o n "Nationa l System s Supportin g Technica l Progress" , Maastricht. Elam, M., M . Börjeso n (1991 ) Strategie s o f Flexibilit y or Rewordin g the Worl d o f Work in Sweden?, in: B. Jessop, H . Kastendiek, K. Nielsen, O. Pedersen (eds. ) The Politics of Flexibility, London : Edgar and Allen, 240-258. Fruin, W.,T. Nishiguchi (1990) The Toyota Production System: Its Definition and Diffusio n in Japan, paper presented t o "The Organizatio n of Work and Technology: Implications for Countr y Competitiveness" conference, Brussels : EIASM. Grootings, P. (ed.) (1990) New Forms of Work Organisation, Berlin , New York: de Gruyter. Gustavsen, B . (1987 ) Repor t o n th e LO M Programme , Ontario : Ontari o Centr e fo r th e Quality of Working Life. Hertog, J.F . den , P . Schöder (1989 ) Social Research for Technological Change: Lessons from National Programmes i n Europe and North America, Maastricht: MERIT. Hildebrandt, E . (1987 ) Compute r Aide d Proces s Plannin g in th e Germa n Machin e Tool Industry, unpublished WZB Discussio n Paper, Berlin : WZB. Jürgens, U . (1990) Nationa l and Company Specifi c Difference s in Organizing Production Work i n th e Ca r Industry , paper presente d t o th e Worksho p o n "Th e Organizatio n of Work and Technology: Implications for Country Competitiveness" conference , Brussels: EIASM. Kelly, J.E. (1982) Scientific Management, Jo b Redesign an d Work Performance, Ne w York: Academic Press.

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Kidd, P . (ed.) (1990 ) Organisation, People an d Technology i n European Manufacturing: Interdisciplinary Research fo r th e 1990s, CEC/FAS T Consultanc y Report , Brussels : CEC/FAST. Klein, J. (1991) A Re-examination of Autonomy in Light of New Manufacturing Practices, in: Human Relations X (43): 23-31. Knights, D., H . Willmott, D. Collinson (eds.) (1985) Job Redesign: Critical Perspectives on the Labour Process, London : Gower . Leydesdorff, L. , P . van de n Besselaa r (1987) Squeezed betwee n Capital an d Technology : On the Participation of Labour in the Knowledge Society, in: Acta Sociologica 3/4 (30): 80-94. Lincoln, J. (1990 ) Work Organization i n Japan and th e Unite d States, pape r presented t o "The Organizatio n of Work and Technology: Implications for Country Competitiveness" conference, Brussels : EISAM. Loveman, G., W. Sengenberger (1991 ) The Re-emergenc e o f Small-Scale Production: An International Perspective, in : Small Business 3 : 1-18 . Markovits, A. , C . Alle n (1981 ) Trad e Unio n Responses t o th e Contemporar y Economi c Problems in Western Europe: The Context of Current Debates and Policies in the Federal Republic of Germany, in: Economic an d Industrial Democracy 3 (2): 45-57. Mathews, J. (1990a) Towards a New Model o f Industrial Development in Australia, Industrial Relation s Working Papers 6, Sidney: Schoo l o f Industrial Relations and Organisa tional Behaviour , University o f Ne w Sout h Wales, Sydney . (Apply to thi s Departmen t for copies o f J. Mathew's Australian Financial Review article reviewing TQM.) Mathews, J. (1990b) Tools o f Change, Melbourne : Pluto Press. Moore, R . (1984) The Control o f Frontiers: Workers and Ne w Technology, Disclosure an d Use o f Company information, Oxford : Oxford University Press . Naschold, F. (1980 ) Problem s of a Society-Oriente d Researc h and Developmen t Pol icy - Th e Humanization of Work Program a t the Crossroads, WZ B Discussion Paper IIVG/dp/80-213, Berlin: WZB . OECD (1988) New Technologies in the 1990s: A Socio-Economic Strategy, Paris : OECD . Offe, C . (1985 ) Disorganised Capitalism: Contemporary Transformations o f Work an d Politics, Cambridge, GB : Polity Press. Perez, C. (1983) Structural Change and the Assimilation of New Technologies in the Social and Economic Systems , in: Futures 1 (5): 131-154 . Perrow, C. (1990 ) Smal l Firm Networks , Draft Discussio n Paper, Connecticut : Yal e University. Poliert, A . (1990 ) Conception s o f Britis h Employmen t Restructurin g in th e 1980s , in : I. Varoe , M. McNeil , S. Yearl y (eds.) Decyphering Science an d Technology, London : Macmillan, 74-103 . Poliert, A. (1991) Farewell to Flexibility, London : Gower. Pornschlegel, H. , H . Schütt e (1981 ) Arbeitswissenschaflic h bedeutsam e Vorschrifte n i n Tarifverträgen - Ein e Analys e ausgewählte r Aspekte, in : Zeitschrift fü r Arbeitswissenschaft 3 (35): 7-12. Ruth, K . (1990 ) Industria l Cultur e an d Technolog y Developmen t i n th e Germa n Ma chine Too l Buildin g - Preliminar y Findings of a Researc h Project , prepare d fo r the International CAPIRN conference "Industrial Culture and Competitiveness: The Social Organisation of Production and Innovations", Gelsenkirchen.

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Schallock, B . (ed. ) (1991 ) CIM-Gestaltungswisse n Projekt , unpublishe d report, Berlin : IPK. Sorge, A., G . Hartmann, M. Warner, I. Nicholas (1983) Microelectronics an d Manpower in Manufacturing, Aldershot : Gower . Sorge, A., W. Streeck (1988 ) Industrial Relations an d Technical Change: Th e Case for an Extended Perspective , in : R. Hyman, W. Streeck (eds. ) New Technology and Industrial Relations, Oxford: Blackwell, 1-22. Warner, M , W . Wobbe , P . Broedner (eds. ) (1990 ) Ne w Technology an d Manufacturing Management: Strategic Choices for Flexible Production Systems, Chichester : Wiley. Wilpert, B., A. Quintanilla (1984) The German Humanization of Work Programme: Review of its First Twenty Publications, in: Journal o f Occupational Psychology 4 (57): 9-21. Womack, J.P. , D.T . Jones , D . Roo s (1990 ) Th e Machine That Changed th e World, Ne w York: Rawson Associates.

Designing Sustainabilit y o f Industrial Societ y Udo E. Simonis There is something fundamentally wrong in treating the Earth a s if it were a business in liquidatio n (Herman E. Daly) .

1 Introductio n Garret Hardin , i n hi s essa y o n "Th e Traged y o f th e Commons" , remark s (1968:1245) "In a reverse way, the tragedy of the commons reappears in problems of pollution. Here it is not a question of taking something out of the commons, but of putting something i n - sewage , o r chemical, radioactive , an d heat wast e into water; noxious and dangerous fume s into the air; and distracting and unpleasant advertising sign s int o the lin e of sight" . Hardi n states tha t utility consideration s are much the sam e a s before: "Th e rationa l ma n finds that his shar e of the total costs of wastes h e discharges into the commons i s less than the cost of purifyin g his waste s befor e releasin g them. Since thi s is true for everyone, w e ar e locked into a system of 'foulin g ou r own nest', so long as w e behave only as independent, rational, free-enterprisers". H e concludes: "The ai r and waters surrounding us canno t readily b e fenced , an d s o th e traged y o f th e common s a s a cesspoo l must b e prevente d b y differen t means , b y coerciv e law s o r taxin g devices . W e have not progressed far with the solution of this problem". In thi s paper , I shal l focus o n thre e element s o f suc h a solution . First, I wil l present th e potentia l o f ecologica l structura l an d technologica l chang e o f th e economy an d will provide some empirica l evidenc e on the relationship between structure and scal e o f the economy an d their environmental impacts. Secondly, I shall point to some of the shortcoming of environmental policy and will ask for a shift towar d wast e reduction or pollutio n prevention technology. Thirdly, I shall put forwar d some idea s on how to integrate ecological dimension s into practical economic policy. "Ecological structura l and technological change of the economy", "preventiv e environmental policy" and "ecological orientatio n of economic policy" thus seem to me to be major strategic elements for decreasing the pollution load, or the points of departure fo r escaping from the (reverse sid e of the) tragedy o f the common s and reaching sustainability of industrial society.

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2 Ecologica l Structura l and Technological Chang e of the Economy In both th e East and the West, economists, planners and engineers ar e seeking t o change th e traditiona l patterns o f resourc e use . "Perestroika " and "moderniza tion" are two actual catchwords i n this process, and new environmental prioritie s play a part i n the envisaged structura l and technological conversio n of the econ omy (cf. Enyedi et al. 1987). Reconciling ecology and economy i n a specific sens e relies o n the premise that a reduction in the input of energy an d material resourc e will also lead to an ex ante reduction of emissions and wastes tha t have a negative impact on the natural environment (ecological structural change). In order to clarify th e relationship between economic structural and technological change and environmental impacts, one needs suitable information concerning the material side of production, for long-term sustainability cannot appropriately be described i n such terms a s income, investment s and consumption. On e possi bility i s to selec t an d compar e som e relevan t indicators describin g th e environmentally significant feature of the production process . The availabilit y of environmental indicators suc h as emission data relatin g to 'representative' pollutants - lik e sulphur dioxide (SO2), carbon dioxide (CO2) and nitrogen oxide (NO X ) - ha s rapidly grown in the last decades (e.g. th e annual reports on the Environment by several industrial nations, by UNEP and the OECD) . These indicator s concer n certai n negativ e environmental effects o f production . Less is known on the environmental significance of the input factors i n industrial production, o r on the question o f which indicators provide environmentally significant information about the structure of the economy. Given the present state of statistics, onl y a few such indicators can be tested i n a cross-national compariso n of Eastern an d Western countries.

2.1 De-linkin g Economi c Growth from Environmentall y Significan t Input s Using a set o f fou r indicator s (inpu t factors), Jännick e et al . (1989 ; th e following dat a an d argument s rel y o n thi s article ) hav e studie d 3 1 countrie s o f bot h COMECON an d OEC D wit h regar d t o th e relationshi p betwee n structur e and scale o f the econom y an d environmental impacts. Th e fou r factor s whos e direc t and indirect environmental significanc e is thought to be self-evident are: energy, steel, cement, an d freight transport. Regardin g thei r pattern s o f production an d consumption thes e are environmentally "hard" factors, characteristic o f a certain structure, technology, and/or scal e of the economy. The main hypothesis of the research therefor e was a rather simple one and reads like this: positive environmental effects of structural and technological chang e of the economy ar e to be expected b y actively de-linking economic growth from the

Designing Sustainabilit y of Industrial Society 16

3

use of environmentally significant inputs (resources). Suc h activ e de-linking (o r ecological structural policy) woul d - resul t in a decrease o f resource depletion and/o r environmental pollution; - mea n ex ante instea d of ex post environmental protection ; - promot e integrated, less polluting technologies whic h touch upo n several environmental effects (pollutants) at one and the same time . Ecological structura l and technological chang e as a shift o f input factors can thus be conceived as a process o f successive de-linking: Th e contribution of traditional (hard) input factors to the national product decreases, i.e . they change or lose their function i n the development process .

2.2 Example s of Successful an d Unsuccessful De-linking Taking th e Federa l Republi c o f German y a s a n example , Figur e 1 illustrates a five-fold de-linking from the growth of the Gross Domesti c Produc t (GDP) : Th e de-linking o f energ y an d cemen t consumptio n an d weigh t o f freigh t transpor t from GD P becam e apparen t durin g th e 1970s ; regardin g steel , th e de-linking process began alread y in the 1960s . In this way, structural change of the econom y generated environmental gratis effects o f various kinds: - th e stagnating consumption of primary energ y le d to a reduction of harmfu l emissions (pollutants); - th e relative decline i n the weight of freight transpor t indicate s that the volume of materials employed wa s reduced rather than increased ; - th e fal l i n th e us e o f cement represent s a direc t grati s effec t a s fa r a s th e emissions fro m cement factorie s ar e concerned; thi s decreas e coincide d with the trend towards labor-intensive renovation of the housing stock, as compare d to new construction; - th e decrease i n steel consumption account s fo r a considerabl e reductio n in harmful emission s a s fa r a s processin g i s concerned; thi s drop wa s strongly marked an d partly due to increased recyclin g activities. Environmental gratis effects occu r whe n th e rat e o f usag e o f th e inpu t factor s (resources) havin g a (strong) negative impact on the environment remains below the growt h rat e o f th e GDP . Comparin g th e rate s o f usag e o f th e fou r selecte d input factors with the GDP growth rate, three distinct development patterns emerg e (Jänicke et al. 1989) : - Th e factors having impacts on the environment decline absolutely; i.e. absolute structural improvements ar e induced, corresponding to absolute environmental gratis effects.

164 Ud

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applied research - > industrial development. 2. From 1971 t o 1978: Th e priorit y was t o hel p researc h programme s wit h clearly define d industria l goals. Privilege d mean s o f interventio n were imple mented in two fields; on the one hand, the environment of firms and, on the other hand, obstacles hinderin g innovation. This new national policy clearly illustrates the shif t fro m a n upstream for m of management ('large-scale programmes') to a downstream one, whic h is mainly in the hand of firms themselves. From a n institutional point of view, this evolution led in 197 1 to the creation of the appointment of an "industrial relations director". At the same time, the National Bureau of Scientific an d Technica l Informatio n (BNIST), th e Regiona l Agencies o f Scientifi c

National Policies Devote d to Technology an d the Environment in France 25

3

and Technical Information (ARIST) working under the authority of the Chambers of Commerce an d Industry, a National Bureau of Metrology (BNM) , were set up. 3. Since 1979: National policy became marke d by the need to find a new balance between fundamenta l researc h and industrial development. The emphasis shifte d to the circulation of research result s particularl y national research result s within the industria l system. I n orde r t o achiev e thi s goal, th e ANVA R was revampe d several time s between 197 9 and 1984 . Initially , i t was mad e responsibl e fo r th e management of financia l ai d an d subsidies. Then i n 1982 , it monitored loans for industrial renovatio n of th e Industria l Fund fo r Modernization (FIM) . The lega l status of the agency wa s also modified. It became a n Industrial and Commercia l Public Agency (EPIC) with three issues: promote the diffusion o f research results, develop innovation and contribute to industrial modernization (Dufour t 1991) . 1.3 Technology , Institutional Chang e and National Polic y It is important to point out that the French technology policy reveals real awarenes s of th e pre-requisite s neede d t o implemen t suc h a nationa l policy . Thes e pre requisites are : th e rol e o f informatio n i n innovatio n processes; th e complexity of relations between th e differen t institution s involved; the for m of organization between th e differen t institutiona l partner s whos e co-operatio n i s a ke y facto r in th e succes s o f an y innovatio n strategy. Innovatio n a s a proces s o f creatio n of technolog y i s a collective , cumulativ e and interactiv e phenomenon , whos e efficiency full y depend s o n th e existenc e of a for m o f organizatio n compatibl e with these characteristics (Alle n 1983; Dosi 1988 ; vo n Hippel 1988) . Nevertheless, i t is possible to analyze the institutional action plans launched to pursue technology policy . The same is equally true for the tools use d t o promot e the practice of collective forms of technical research withi n the industrial system. Therefore, technolog y policy necessarily implies a transformation of institutional structures. I t will guarantee optimal use of th e technological resource s available to the parties concerne d sinc e technologica l progress cuts across the boundaries of firms, industries and sectors. Th e ver y nature of modern technology, its transsectoral an d generi c character , underlie s the working s o f technolog y polic y i n France. A s the following point s out, "In France, particularl y during the eighties, the search fo r stable patterns of partnership conducive to the creation of technology, whether this implies cooperation betwee n firms or between firms and other institutions, as well as major efforts t o develop fundamental research , ar e the two main trends in national policy" (Dufour t 1991:366) . This transformatio n of institutiona l structure s can bes t b e see n a s a move to wards the promotion o f a mixed economy. Thi s has been patentl y obvious sinc e 1958. Chang e i n legislatio n an d th e lega l statu s o f differen t form s o f associa tion betwee n partner s such a s publi c bodies , als o follo w this trend. Sinc e 1982 , a grea t variet y of suc h differen t bodie s hav e bee n created , e.g . th e Publi c Ad -

254 Lahse

n Abdelmalk i and Thierry Kirat

ministrative Agency (EPA) , the Scientific an d Technical Agenc y (EPST) an d the Public Industria l and Commercia l Agenc y (EPIC) . Al l ar e governe d b y regula tions which provide a framework and a programme for governmental action in the field of research an d technological development. According to Dufourt, this has been prompted by a "threefold desire : firstly to develop public research, liberaliz e management method s an d finally promot e collaboratio n wit h the privat e secto r through the creation o f subsidiaries" (Dufourt 1991:366) . This latter point reveals a certain consistency i n French policy , since it demonstrates th e effort undertake n since 1958 to promote collaboration betwee n public and private actors in technological research. This collaboration is conducted within a working institutional framework. It is therefore clea r that French technology pol icy i s not merely base d o n mechanism s designed t o correct th e shortcoming s of research i n terms of funding researc h activities . This would be a rather poor wa y of solvin g the problem . O n th e contrary , i t shows a certain clear-sightednes s a s to th e natur e and requirement s of innovatio n processes. Al l thi s i s reflecte d i n the creation of institutional and legal conditions designed to facilitate public and private partnerships aroun d the research projects . It is quite obvious, as we shall see later , that technological research relate d t o the environment may her e find a suitable conducive framework, whereas fo r a long time it seemed unabl e to find it in the institutionalized measures undertake n to pursue environmental policy.

2 Frenc h Environmenta l Policy, Past and Presen t In reviewing French environment policy we must not only describe relate d trends , strategies an d decision s bu t als o cas t a critica l ey e t o identif y strength s an d weaknesses. I t i s obviou s tha t merel y describin g an y environmenta l polic y i s quite unsatisfactory ; this shoul d b e backe d b y emphasi s o n th e foundation s of such policy. 2.1 Environmen t an d Environmental Policy : An Introductio n While on e ma y agre e o n a suitabl e actio n o r polic y t o trea t an d protec t th e environment, there i s some doub t as to the purpose o f such a policy. 2.1.1 Definitio n and Scope o f the Environmental Issue Here, on e face s a tricky , almost insolubl e problem, give n th e absenc e o f an y objective an d accurat e references . Ha s th e wor d "environment " anythin g to d o with Nature , o r shoul d i t be understoo d i n terms o f surroundings ? Is i t a global problem whic h coul d b e equate d wit h ou r civilization , o r shoul d i t b e boxe d

National Policie s Devote d t o Technology an d the Environment in France 25

5

into economic , technica l an d cultura l sectors ? Whateve r th e answer s t o thes e questions, how ca n w e qualify a n analysis of the environment? One could wave this embarrassing proble m of definition asid e and either argue that th e environmen t is constantl y changing , tha t i t i s a matte r o f intellectual speculation o r t o sa y tha t an y definition , howeve r accurate , i s o f littl e interes t per se . Thi s stanc e ma y lea d on e t o focu s o n ou r livin g habita t and ou r natural heritage i n order t o asses s thes e condition s o r thei r scope . I n th e final analysis, one ca n fatho m ho w difficul t thi s tas k is . Environmenta l issue s hav e suddenl y been take n u p by th e economist. I n many respects, economist s fee l ill-equippe d to tackle thes e issue s wit h only the traditional means a t their disposal: the y may opt fo r a globalist approac h bu t run the ris k o f being overwhelmed, o r they may choose a more fragmented approac h whic h will ultimately leave them unabl e to grasp the numerous parameters tha t characterize th e human environment and its evolution. A s wa s suggeste d b y Roquepl o (1990) , ther e i s a middl e cours e o f "interdisciplinary knowledge" . I t represent s a qualitativ e leap betwee n a multidisciplinary approac h an d a n immediatel y global one . Roquepl o himsel f admits that his solution clashes wit h what can be called three epistemological obstacles : - Firstly , an y knowledge i n term s o f environmen t supposes experimenta l and theoretical procedure s whic h would giv e it a degree of plausibility . This onl y becomes possibl e i f preliminar y procedures alread y exis t i n orde r t o settl e disagreements o r validate truths. - Secondly , i n any diagnosis o n the environment, all laws of nature shoul d be perfectly know n and accounted for . - Las t but not least, government legislation on the environment may be assumed to b e limitless . Th e link s betwee n thes e law s ar e probabl y ver y complex , and thi s complexit y i s compounde d b y a numbe r o f uncertainties : physical limitations, adaptability and the responsiveness o f human beings. In conclusion , w e ma y sa y tha t environmental knowledg e carrie s a ris k i n tha t it onl y derive s it s legitimac y fro m agreement s tha t generat e reasonabl e an d objectively-based knowledg e within a set and temporary tim e frame. 2.1.2 Trend s an d Practice i n Environmental Policy Most OECD countries have begun implementing environmental policies in the last 20 or 30 years. The general framework of the operational tool s developed consist s in the creation o f economic instrument s aimed a t encouraging polluters to lowe r levels of pollutant emissions and stimulate clean technologies . Thes e tools wer e mostly base d o n th e premis e tha t pollutio n i s caused b y externa l economie s o f consumption and production. Two approache s correspondin g t o distinc t type s o f environmenta l polic y in struments ca n b e followe d i n a n environmenta l policy; th e firs t ca n b e terme d a regulator y one, owin g to th e fac t tha t i t involves setting up institutiona l mea-

256 Lahse

n Abdelmalk i and Thierry Kira t

sures aimin g at directly "influencing the environmental performance o f polluters by regulatin g processes or product s used , b y abandonin g or limiting the release of certai n pollutants , and/o r b y restrictin g activitie s to certai n time s an d area s through licensing , standar d settin g an d zoning " (Opschoor/Vo s 1989:12) . Th e second approac h i s les s constraining , sinc e it s ai m i s t o provid e economi c an d monetary incentives for polluters to behave in a more environmentally-compatible way. It entails the implementation of several kinds of economic instrument s such as charges, subsidie s and deposit-refund systems . A ne w economic secto r migh t be create d tha t would integrate th e biological , aesthetic an d scientifi c valu e o f Natur e t o mov e toward s optimu m growt h i n terms of economic retur n on investment and development. A t the same time, such integration raise s th e acute problem o f the type of approach tha t would be used : thus, th e attack s o n fores t lan d an d nois e i n urba n area s fo r th e 'intersection ' between th e economy an d ecosystems. D o they exclusivel y belong t o the real m of natural sciences, o r are they merely economic problems ; i n that case, ho w are they t o b e analyzed ? W . Kapp, Knees e an d Ayre s provided a n origina l answer, but unfortunately its appeal wa s short-lived . The y though t the identificatio n and quantification o f physica l flow s fro m th e poin t o f vie w o f extractio n an d wast e should precede monetar y analysis (see Bourguina t 1973) . Under thes e conditions , wha t coul d a n environmenta l polic y be , an d wha t should be its aim? Again, one inevitably hesitates whe n choosing a precise course of action . T o fin d a wa y ou t o f thi s dilemma , on e ma y choos e betwee n th e satisfaction o f having raised a practical problem o r take a negative attitude which involves shaping environmental policy i n terms of what it should not be, i.e. : - a short-term policy, indeed, any radical change in soil management, production plants tha t caus e pollutio n an d forecastin g method s requir e tim e an d mone y to suc h an extent that the greater need fo r materia l resource s place s constan t pressure on the use of space and non-renewable resources ; - a curative policy only concerned with symptoms: th e risk her e woul d be to deal onl y with well-known consequences o f pollution such as mental fatigue , nervous tension and various frustrations, only detectable afte r a long period of accumulation; - a fragmented policy, either in terms of speciality or in terms of degree of gravity: specifi c corrective action s ma y no t only be ineffectual bu t they could also defea t th e origina l purpose . Fo r example , removin g pollutio n fro m th e air coul d pollut e water ; burnin g industrial wast e migh t affec t th e purit y o f air. While focusing one's attention on industrial processes, one may overloo k different product s an d the way they are used . Th e emphasis belo w wil l be on the nee d t o distinguis h betwee n th e so-calle d end-of-pip e technologie s an d genuine 'environmenta l technologies' .

National Policie s Devote d to Technology and the Environment i n France 25

7

2.2 Feature s of French Environmental Policy For a long time, nationa l policies i n environment, technology, industr y or energy assumed tha t the industrial system of production was conceived as a conservative system, an d not in terms o f a dissipative one (Ayres 1989) . Th e environmen t has remained a kin d o f 'alien ' factor ; t o integrat e i t wa s considere d almos t a s a n expensive form o f regulation. The environmental policy implemented in France currently undergoes dramati c changes related to both its institutional architecture and its aims and scope. These changes will be analyzed afte r summarizing th e main characteristics of the polic y which have prevailed unti l th e French governmen t adopted th e National Plan fo r the Environment in December 1990 . 2.2.1 A Belated, Flexibl e an d Centralized Environmenta l Policy In France , environmenta l polic y i s bot h overdu e an d conservative . Thi s dela y can b e observed a t two levels . Firstly, the Ministr y of Environment was create d in 199 0 (admittedl y i t then replace d th e Secretar y o f Stat e fo r th e environment created in 1974). Furthermore, paltry funds were allocated, only 0.07% o f the total budget allocations to all ministries in the 199 0 budget (in 1989 , the environmental budget was only 0.06% o f the total allocations). While this small allocation for the environment can explain the difficulties in coordinating the different actions, it also highlights the very cautious attitude of the government towards the environment. The hallmark of state action is its lack of interest in large-scale reforms , probably because i t has too much to deal wit h and this would cause majo r disruptions; the costs would be high and the benefits may not be clearly discernable. Therefore , the state ha s merel y a regulating action wit h very unequal constraints. It is there to compensate fo r the very low commitment of both companie s an d households . In 1987 , th e stat e expenditur e i n nationa l environmen t programmes accounte d came to 53.8%, companies 26.4% an d households only 19.8%. About 66% ofthat money paid for running costs, while 34% was used to finance investment projects. Today thes e tw o budgets respectivel y absor b 68% an d 32 % of th e tota l amount allocated to the publi c administrations (see Tables 1 and 2) . The relativ e weaknes s o f resource s allocate d t o investment , which aim s t o create a suitable technological and institutional framework likely to influence th e programming an d implementatio n of national decisions i n environmental terms, has also bee n regularl y decreasing ove r time . In 1967 , i t represented 60 % of th e environmental budget; in 197 5 the figur e had sun k t o 50%. I n 1987 , the share of households an d companies i n investment represented respectivel y 10.2 % fo r the former and 6.8% fo r the latter in terms of national environmental outlay (Secretary of State for the Environment 1989). The greatest challenge facing environmental policy in France is therefore to abandon this neutrality over the rules of the market, as suc h neutralit y exerts a constraint. This conservativ e attitud e may ultimately

258

Lahsen Abdelmalk i and Thierry Kirat

Table 1 : Structur e of the national environmental outlay in 198 7 (millions of Franc s in 1988 prices )

Water Air

Public administrations

Industries Household

Amount %

Amount %

19,243

-

Amount

%

3 3,70

2

5.1

29,642

41.1

-

5,862 8.

1 56

2

0.8

6,424

8.9

,073

1.5

2,346

3.2

9

1.8

18,263

25.4

485

0.7

0.7

729 1

Waste

11,234

15.6

5,740 8.

485

0.7

7,267

10.1

38,773

53.8

Total

t%

6,697 9.

544

Environment

Amoun

Total

26.7

Noise Ecological patrimony

s

.0 1

0 1,28 -

19,028 26.

-

7,620

10.6

14,887

20.6

5

19.8

72,047

100.0

4 14,42

Source: Secretaria t d'Etat charge d e l'Environnement (1989:39) Table 2: Environmenta l outlay per agen t and pe r type in 198 7 (millions of Francs in 1988 prices ) Investment

Functioning

Total

Amount %

Amount %

Amount

%

Public Administrations

12,277

31.7

26,496

68.3

38,773

100

Industries

4,898

25.7

14,130

74.3

19,028

100

Households

7,357

51.6

6,889

48.4

14,246

100

Total

24,539

34.0

47,515

66.0

72,047

100

Source: Secretaria t d'Eta t charg e d e l'Environnement (1989:39)

cancel an y effor t t o chang e attitude s to wast e an d pollution . Fo r example , onl y lately did some people insist on the possibility of upgrading techniques to improve energy efficiency b y integrating within the latest technology i n various materials . Although i t ha s bee n regulatory , Frenc h environmenta l polic y ha s remaine d flexible to accommodate th e difficulties o f integrating the social cost of economi c activities int o economi c calculation s o r o f devisin g a large-scal e environmen t scheme such as in other economic o r social sectors. Another obstacle ha s been the delays and hesitations i n translating the identified social cost s of public decisions into its inherent or civilian structures.

National Policies Devote d t o Technology an d the Environment in France 25

9

2.2.2 Th e Tools of the Environmental Policy As far as France is concerned, on e can distinguish two courses o f action in environmental policy: the first relates t o operational indirec t regulator y instruments, in connection wit h publi c management o f th e natura l environment. The second , more recent tha n the first, includes research programme s i n environmental fields, aiming a t producin g advanced knowledg e i n the functionin g o f ecosystems an d pollution-producing processes. Concerning th e former , excep t i n a few , well-define d field s suc h a s water , air an d waste , th e rol e o f th e stat e ha s bee n overcentralize d unti l recently ; but as w e shal l see, thi s did no t clas h wit h it s segmented , sector-specifi c character . The majo r decisions an d majo r resource s (howeve r limited ) were controlle d b y the central publi c bodies. While thi s centralized for m o f management i s neede d to offe r a regulator y and unifor m framewor k fo r environmenta l actions, i t soo n becomes steril e i f i t i s not complete d b y suitabl e local measure s abl e t o absor b the many situations that arise in the field. A few examples wil l show the method s and tool s used, a s well as their limitations. We shall see that these measure s ar e either ineffectua l - thi s i s the case for the management of social cost s in public transport - o r that they are misapplied. This is especially true of the management of water and waste . The management of water shows that even when the public system is organized and decentralized , it i s nevertheless affected b y certain factor s which eventually cause a relative inefficiency o f its methods of management. In 1964 , the Financial Water Agencie s (AFB ) promoter s wante d th e wate r suppl y to b e manage d lik e many othe r commodities , i.e . i n accordanc e wit h price s an d demand . Fo r thi s system to work, it was necessary to make consumers feel responsibl e through an 'internalization' o f the global cos t o f the servic e whic h would take int o account the cos t o f supplyin g water a s wel l a s th e cos t o f treatin g liqui d waste . I t wa s then necessar y t o work ou t a n accurat e syste m o f wate r charge s t o charg e eac h individual consumer only for water actually used and at a rate that truly reflected consumption (i.e. time of year, quantity, waste, quality of the site). But owing to the pressure of industrial firms and local authorities, the whole organization drifted into the mutualization of costs which in turn blunted the responsibility of members, whereas taxes were originally there to remind them of their responsibilities (Martin 1988). Similarly, local authorities are in charge of waste collection. They are therefore at the heart o f a specific organization of actors, an d because o f this position, they have a wide choice i n the way they run thi s service. The y generall y subcontract these responsibilities t o privat e companies, usin g the lega l framewor k o f a sub contracting kind of executive management (known as "gestion deleguee"). These private firms are generally large diversified industrial groups such as the "General e des Eaux" or the "Lyonnaise des Eaux". Their experience i n the water an d waste business means that they are well qualified to deal wit h environmental problems,

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especially in urban areas. Because o f the conjunction of several phenomena, such as th e considerabl e agin g of th e urba n technical networks , the y hav e t o ru n a n ever-increasing numbe r of differen t form s o f pollution and man y of these firm s have accepted t o make considerable efforts . The way in which road tax and freight transport are worked out in financial terms show ho w difficul t i t i s to mov e from globa l socia l cost s t o the implementation of a market price. Indeed, several studie s (Bernadet/Lasserre 1985 ; Quinet 1990) have proved tha t whatever the options, if external social costs ar e not taken into account it will lead t o the wrong choice bein g made. Long-haul freight transport offers a range of alternatives: railways, roads or waterway. From a collective point of view, when social cost s ar e taken into account, rail proves cheape r tha n road ; whereas i n strict market terms , th e contrary is true. In the sam e way, silent, non polluting cars would cost more to start with, but they would spare local authorities from footin g the environmental bills for noise and air pollution. The secon d thrus t o f th e environmenta l policy , les s importan t tha n th e operational-regulatory trend , relate s t o researc h programmes . I t ha s bee n im plemented only relatively recently, since no support of environmentally-oriented academic research ha d been provide d until the creation i n 197 9 of the Interdisciplinary Research Programm e into the Natural Environment (PIREN). Following an interdisciplinar y approach i n th e fiel d o f fundamenta l research, th e researc h programmes supporte d by the PIREN were implemented by public research bod ies such as the CNRS, the universities, the Secretary o f State for the Environment and various specialized publi c institutions. The scope of research was rather large, since it included eight themes: - continenta l aquatic systems, - rura l environment, - researc h int o the atmosphere, - coasta l regions , - ecotoxicology , - environmen t and health care, - legal , sociological and economic aspect s o f environmental protection, and - histor y of the environment. Research programme s undertake n under the PIREN framework were essentially academic an d fundamental; no support wa s granted to applied technological research, whether solely public or in collaboration with the industries potentially or effectively involved . The only institutional framework devoted t o this comprised research programme s designed an d coordinated by the Department of Research, Studies, Treatmen t o f Informatio n o n Environmen t (SRETIE) o f th e Secretar y State of Environment. It should be noted that this ministry has not been provided with a body responsibl e fo r th e technologica l and scientifi c aspect s o f environmental protection . Befor e th e creatio n o f th e SRETI E i n 1984 , th e predecesso r was the Mission des Etudes et de la Recherche which had neither resources no r

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power. I n 1989 , th e SRETI E ha s bega n implementin g seven multi-disciplinary research programmes i n cooperation wit h the Research an d Technology Ministry (Le courner du CNRS 72 , May, 1989) : - ECLA T (Evolution of climate and atmosphere), - "toxi c waste" , - "larg e rivers", - "ecologi c consequences o f agricultural crisis", - "sprea d of coastal seaweed" , - "genetic s an d environment", and - "eco-product s and clean technologies" . The implementatio n of thes e programme s ma y actuall y be considered a s a first step towards broadenin g the scope of environmental policy, which implies interministerial cooperation . 2.2.3 Th e Institutional Infrastructure o f Environmental Policy an d its Recent Evolution In th e tw o las t years , severa l majo r shift s i n th e goals , scop e an d practice s o f environmental policy have occurred; the y reveal a n unprecedented awarenes s o f the technological challenges linked with the search fo r new less environmentally damaging actions. From a n institutional point of view, important changes should be underlined ; the mos t importan t i s th e reinforcin g of th e interlink s between environmental an d technolog y policies . Th e Nationa l Plan for th e Environment states that: "the machiner y (of environmental policy) are ill-adapted. Neither the law, poorl y applied , no r th e economi c incentives , too low , hav e succeede d i n providing a durable and deep integratio n of environmental issues i n the society" (quoted by F. Billaudot 1991:334). This National Plan, adopted by the government in December 1990 , has been jointly developed b y the Ministries of Environment and of Research an d Technology. It aims to largely increase researc h i n the field of environment, which is expected to represent 5% of the national research effor t in 1995 , so as to catch up with the German level. The Nationa l Pla n fo r th e Environmen t sets th e followin g prioritie s i n tha t area: - Rational coordination o f public support for environmental research: It is now the responsibilit y of th e Coordinatio n Committe e o f Publi c Researc h Con cerning the Environment (CCRPE) to fulfi l thi s function. Th e Committee will also b e responsibl e fo r studyin g measures t o improv e th e efficienc y an d th e coordination of research programmes . It will have to control th e coherence o f these programmes with EEC programs suc h as STEP/EPOCH. - Stimulating technological research as far as "clean technologies" are concerned: Fo r this priority the Environment Ministry has just decided t o set up an institutional framework for technology policy to achieve this. In this regard,

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the recent creatio n o f two Groupements d'Interet Public (GIF) i n the fields of water an d fores t ecosystem s ma y be considere d a s precursors o f a close lin k between environmenta l and technolog y policie s owin g to th e constitutio n of stable, cooperativ e pattern s o f organizatio n o f researc h whic h implies publi c research bodie s as well as private firms. At the administrativ e level , th e National Pla n fo r the Environmen t initiates bot h the refor m o f existing institution s and the creatio n o f ne w ones. Concernin g th e Ministry o f Environmen t itself , i t wa s highl y unstabl e befor e 1991 , owin g t o frequent change s whic h affected its attachment to other ministries . Moreover, it s means o f intervention were scattere d an d it had no external services. The action s undertaken b y thi s ministr y 'i n th e field ' require d th e involvemen t of decentral ized department s o f othe r ministrie s (regional publi c work s authorities , depart mental agricultur e authorities). Thi s lac k o f locally based bodie s ha s been over come by setting up the Regional Environmen t Authorities (Directions Regionales de l'Environnement, DIREN) an d b y convertin g th e Directions Regionales d e I'Industrie et de la Recherche into Directions Regionales de Γ Industrie, de la Recherche e t de l'Environnement (DRIRE). 2 2 metropolitan DIREN' s hav e bee n created b y amalgamatin g pre-existin g specialize d departments . Th e rol e o f th e latter is: - t o fulfil al l missions attributed by the Ministry of Environment, in the following fields: water, protection o f natural areas and the landscape, enhancemen t of the urban and architectural heritage ; - t o coordinate, process and circulate data linked with the environment and contributing wit h ne w institutions such a s ADEME, IFEN , INERIS t o upgrading the qualit y o f scientifi c knowledge , th e desig n o f method s o f investigation, evaluation, management an d protection o f the environment; - t o contribute to informing and educating peopl e abou t th e need t o protect the environment. As alread y mentioned , th e regiona l industr y and researc h authoritie s ar e toda y referred t o a s th e Directions Regionales d e V Industrie, d e l a Recherche e t d e l'Environnement (DRIRE). Withi n each DRIRE , a regional departmen t i s set up to manage th e industrial environment. Three ne w publi c bodies, whos e rational e i s to provid e adapted an d relevan t scientific bases and to nurture a new framework o f the environmental policy, have been se t up: the Agenc y fo r the Defense o f the Environment and Energy-Savin g (ADEME), th e French Institute for the Environment (IFEN) and the National Institute for Industrial Environment and Risks (INERIS). These institutional structures were given credence by the following statement s mad e i n the text of the National Plan fo r the Environment: "The wa y the environment will be integrated int o sci entific and technical progress will play a crucial role in the near future" (Billaudot 1991:345). "In France, a large gap prevails in the field of environmental database s

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owing to poor use of existing information and the little effort made to conducting research i n thi s field " (Billaudo t 1991:345) . Th e ADEM E i s th e resul t o f th e amalgamation o f th e Agenc y fo r Ai r Qualit y (AQA) , th e Nationa l Agenc y fo r Waste-Recycling (ANRED ) and the French Agenc y fo r Energy-Saving (AFME) . Its creatio n reflect s a n institutiona l shift tha t underlie s th e nee d t o expres s i n institutional form th e interdependenc e o f different issues whic h were previousl y handled by specific and dedicated agencies . Th e ADEME, whic h has the status of a Publi c Industrial and Commercia l Agenc y (EPIC) , i s responsible fo r combat ing ai r pollution, monitoring waste recover y an d recycling, energy conservation , reducing harmful nois e levels and supporting the development of clean technolo gies and technological research. It draws it s financial resources fro m a system of taxation and licence fees . The IFEN was conceived a s a technical instrument for the Ministry of Environment; i t shoul d quickly become a n equivalen t of th e INSE E a s a n environmen t database. Th e mission s of this Public Administration Agency (EPA ) are in environment connecte d scientifi c an d technica l information , coordination o f studie s implemented i n the field of observation, measuremen t techniques , dat a processing an d th e suppl y of expertise. Th e IFE N i s also abl e t o undertake researc h o r expertise activitie s in a contractua l framework . It s mission s relat e t o soi l use , natural resources, air and water quality, waste management , urba n environment, technological an d natural risks and the sociolog y o f social behaviou r in the field of the environment. Finally, th e INERI S ha s bee n se t u p i n orde r t o provid e a bod y devote d t o applied research activitie s in an institutional framework connected wit h environmental policy. The INERI S is able to undertake variou s activities connected wit h scientific research , test s an d experimentatio n protocol s an d detectio n methods . It also contribute s to settin g standards and formulatin g technical regulations . In addition, the INERIS provides technica l assistance to the DRIRE, financial water agencies, ADEME , publi c authoritie s an d loca l authorities . I t i s wort h notin g that the INERIS shoul d also participat e in cooperative researc h o r expertise pro grammes, conceive d i n terms of partnership, wit h specialized bodie s suc h as the CNRS o r INR A researc h teams , th e universitie s in th e identificatio n and mea surement o f pollutants , analyses o f th e ecologica l impac t o f variou s pollutants, fabrication tests , inspectio n and certification. We must here refe r to the recent renewa l of both th e PIREN, today calle d th e CNRS Environmen t Programme, an d the Interdisciplinary Research Programm e into Energy an d Materials (PIRSEM); th e latte r has seen it s environmental com ponent straightened. One of its most important objectives i s to promote th e development an d diffusio n o f environmentally-compatibl e technologies. Th e forme r aims a t stimulating the inter-disciplinary , inter-institutional and international dimensions of research programme s undertake n within its terms o f reference. Th e PIRSEM i s focussed on the synergy which ties together process optimization and pollution abatement. As C. Claverie, Director of the PIRSEM, says : "In 1991 , one

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cannot but ascertain that the industrial's demand for new, less-polluting technolo gies, o r able t o provide a better us e of fossil resources , become s more important than th e need fo r simply energy-saving technologies". Fou r priorities hav e bee n set withi n thi s programme : energ y productio n an d conversion , industria l processes, transport and urban planning. Moreover, PIRSEM' s strategies derive from an awareness o f the inseparability of research connecte d wit h energy savings and development o f clean technologies .

3 Th e Technological Dimension s o f Environmental Protectio n and their Impact on National Polic y As we have seen, the technological researc h and organization o f innovation production connected wit h the protection o f our natural heritage is not a matter for an environmental policy setting strict goals and matching resources i n financial, human and physical terms. French environmenta l policy is mainly about regulating, redistributive an d allocativ e s o i t shoul d no t b e see n a s a technolog y policy . In addition, technology polic y is very similar since it does not specifically privilege any technological creatio n connecte d wit h the environment. Two questions therefore arise: firstly, would it be a good idea for the state to mobilize public resources for finalize d programme s t o compensat e fo r th e ga p i n technologica l researc h in thi s field ? Ca n on e reasonabl y conside r tha t Frenc h technologica l polic y b e disconnected fro m environmenta l problems ? Both question s for m the backbon e o f th e followin g argument which will fal l in thre e parts . Firstly , w e shal l sho w tha t an y effor t i n term s o f technologica l research int o environmental protection i s not so much a quantitative question of volume of resource s a s a qualitative question o f relevant institutiona l structures and arrangements related to the characteristics of technological creation. Thus, the various measures taken in the context of French technology policy, and especially in the field of legal provisions governing various forms of partnership, are clearly moving in that direction. I n particular, the use made of different structura l options within the institutiona l framework, as defined by technology policy , stems fro m the deliberat e behaviou r o f operators ; w e shal l the n se e tha t th e 'dovetailing ' between technolog y an d environment policies occurs a t the grassroots level . We shall illustrat e that thesi s befor e focusin g on th e limitation s of current forms of organization which we shall then correlate with the relevant industrial strategies of firms and economic sectors .

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3.1 Technologica l Creation and Environment: Fro m Knowledge to Innovation A usefu l approac h woul d see m t o b e t o loo k a t thi s questio n i n th e contex t of a fundamenta l coherenc e whic h govern s th e organizatio n o f technologica l research. Thi s coherenc e i s base d o n th e compatibilit y betwee n th e structura l evolution o f industrie s an d technologie s an d institutiona l structure s groupin g different operator s involve d in the creation o f technologies . In th e fiel d o f technologica l researc h connecte d wit h th e environment , thre e main dimension s appear , i.e . i ) th e strengthenin g o f scientifi c knowledg e int o factors relate d t o th e creatio n o f pollution ; ii ) th e developmen t o f measurin g devices and of a metrology whic h could allow a finer characterization o f pollution levels in order t o find suitable technical solutions; Hi) th e nee d fo r a cooperativ e and synergisti c researc h structure . O n th e firs t point , th e availabl e knowledg e seems lacking i n a numbe r of disciplines. I t i s stil l impossibl e t o detec t certai n pollutants used i n agriculture, e.g. diazin s in drinking water. No one is quite sur e about the side effects of certain water purification processes. Th e aluminium salts used i n these processes are even claime d t o be a possible caus e o f Alzheimer' s disease (Mallevialle/Chamboll e 1990) . The mos t acut e proble m regardin g ai r pollutio n i s th e disastrou s effec t o f CFC on the ozone layer . Roqueplo (1990) ha s clearly pointed out the challenges faced b y scientifi c knowledge . Al l factor s combin e i n suc h a complexit y tha t they can only be scientifically tackled b y interdisciplinary research. Bu t given the French structur e of scientific research, thi s effort clashes wit h the institutionalized partitioning of the different disciplines . Hence , thi s very need call s int o question the role of the state, since i t requires a re-organization o f the institutional patter n of public scientific research . The settin g of normalized infra-technologie s regardin g measurement , metrol ogy an d classificatio n methods seem s a ke y prerequisit e fo r an y efficien t tech nological researc h a s regard s wate r an d fume s analysis , urba n hydrolog y an d drainage (Kira t 1990). Any research concernin g efficien t technologica l processe s entails a capacit y t o characteriz e variou s form s o f pollutio n and prope r instru mentation. Ye t many experts agre e tha t thes e infra-technologie s ar e stil l under developed (Ene l 1987) . 3.2 Trend s in the Organization and Nature of Technologies in the Field of Environmental Protectio n In France , a shif t i n polic y affect s th e managemen t o f wate r an d purificatio n networks i n urban areas, a s well as waste treatment . Th e behaviou r o f the oper ators involve d i n those activitie s is more geare d to the reinforcement o f researc h and technologica l innovatio n programmes . I t mus t b e sai d tha t thes e change s

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stem fro m a growin g convergenc e amon g actors : mainl y industria l firms, local authorities and public research institutions. The type s o f technologie s explore d an d th e form s o f organizatio n o f techno logical researc h see m worth y of interest. Ne w membrane techniques use d in the treatment an d purificatio n o f wate r wer e adapte d fro m a n origina l technolog y that was first used by the food industry . In the same way , real-time management of suc h urba n technical network s a s water , drainag e an d electricit y implies th e adaptation an d th e settin g o f device s base d o n informatio n and communication technologies. General e de s Eau x ha s adapte d device s designe d t o measur e vi brations to detect leak s i n pipework. These few examples mea n t o illustrate the idea whereby ne w technological solution s implemented in the various sectors o f environmental technologies have a trans-sectorial character and therefore requir e cooperative structure s in the organization of research . Such structure s ca n b e observe d i n bodie s suc h a s NANCI E an d GEMCE A which group industrial firms, local councils, public administrations and public research centres connected t o the CNRS or to the universities. Such groupings were made possible b y a set of measures defined within the framework of technology policy, especially in terms of legal provisions dealing with these forms of associ ation. NANCIE is a Public Administrative Agency (EPA ) which includes within the sam e cooperativ e structur e the Urba n Distric t o f Nancy , three universities, six schools and four private laboratories. Th e structure is successfully conducting research into the formation of a biofilm, i.e . it is finding ways to destroy bacteri a living inside the pipework which are supposed to protect pathological germs that might accidentally enter the network, thus affecting th e quality of the water supplied b y the network . The research programm e als o include s the industrial firm Pont ä Mousson, which produces the pipes. The same structure may be observe d in th e cas e o f GEMCEA , whos e statu s i s tha t o f a GI F tha t group s NANCIE , Pont ä Mousson an d the General e de s Eau x i n order t o research int o the fields of normalizatio n of measures, materia l resistance an d the quality of pipes (Can s 1990). All this tends to show that the design of technological innovations, as far as environmental protection goes, requires cooperation betwee n the different player s within a research framework where functional synergie s and interdependences are important. Moreover, som e water specialists have come to realize that the quality of drinking water will in future depen d o n three mai n factors of evolution: i) the standard of quality must be progressively improved on a European scale; ii) the increasing reduction , both i n qualitative and quantitative terms, of water resources , will requir e th e developmen t o f technique s t o recycl e liqui d waste; iii ) all will depend o n the technological progres s i n the fields of biotechnologies, polymer s and membrane techniques. In an urban environment, the same phenomena can be observed. Indeed , larg e metropolises deman d greater efficiency o f urban services as well as an instrumentalization to measure level s of pollution, mostly air pollution. As far as technologies are concerned, these requirements can be translated in terms of transversality;

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and thi s is quite obvious i n the field of communication technologies , bu t i t may ultimately clash wit h sectorial logic s (Droue t 1987) . At this stage, it must be noted that technological researc h project s dealin g with the environmen t are initiate d by actor s wh o ar e responsibl e fo r environmental management problems . I n addition, these innovatin g actions ar e often conducte d outside the scope o f the environmental policy which - excep t i n a few cases, suc h as PIRSEM - doe s not interfere with technological research , eve n if some publi c bodies (e.g. AFB , INRA, BRGM) contribute to these actions. However, things are moving i n th e righ t direction. A s state d above , th e newl y created environment linked agency, the ADEME, unite s three different bodies : the AFME, the ANRED and the AQA. It is worth noting that up till now neither the ANRED nor the AQA had researc h budget s t o suppor t technologica l researc h i n their fields of action. This grouping also shows that the control o f polluting emissions in the air should go han d i n han d wit h a visio n implying that suc h a contro l i s no t s o muc h a question of saving energy a s it was thought in the 1970s , as a way o f integrating "all progres s accomplishe d i n the field of materials and information techniques " into new equipment (Chartrier 1990:12) . Nonetheless, bot h technolog y an d environmenta l policies fac e a majo r chal lenge: according to Kemp/Soete (1990), the implementation of technological solutions to environmental issues can follow two approaches. On e is to promote 'end of-pipe' (o r 'clean' ) technologies; th e secon d i s mor e radica l i n that i t involves the creation an d diffusion o f 'cleane r technologies'. I n the first case, the purpos e of suc h technologie s i s t o provid e marginal corrections t o well-establishe d and irreversible technological strategies, wherea s i n the second case , wha t is at stake is the move towards new technological trajectories, mor e 'environment-friendly ' than i n th e past . Th e possibilit y of suc h a dramatic chang e woul d presuppose a systematic integration of environmental constraints within the sets of criteria used in the early conceptual and design phases o f technical artefacts, whether products or processes. On this issue, a recent OEC D report state s tha t the environmental policies implemented i n the OECD countrie s "have focused o n regulating major source s o f pollution, while mobilizing a system of regulations involving sanctions-associate d constraints in order t o impose th e conception and us e of pollution reducing techniques a t th e en d o f processes " (OEC D 1992:211) . I n th e cas e o f France , th e inducive character o f environmenta l policy i n this respect shoul d b e calle d int o question. The othe r mor e directly-regulatin g aspect o f the environmental policy consists in the promulgation of technical and environmental standards and is aimed at increasing the pace o f technical progress. It s effects should also be questioned ; indeed, i t is more efficient i n stimulating the adoption of "end-of-pipe" technolo gies than in providing inducement mechanisms able to sustain a systematic searc h for ne w and cleaner technologies . Anothe r phenomeno n als o deserve s attention : according t o Kemp and Soete, these environmenta l technologies "diffe r from th e traditional process o f 'normal' technological change involving a succession of new

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and more efficien t productio n techniques" (Kemp/Soet e 1990:251) . The source s of suc h differences arise from factor s affectin g bot h th e suppl y and deman d o f environmental technologies: appropriability conditions, technological opportunities, market demand, problems related t o knowledge and information, insecurit y and uncertainty, lack of user-producer relationships, etc. (se e Kemp/Soete 1990) .

3.3 D o Environmental Technologies Reveal a Rift i n the Industrial System? The economic an d ecological stake s connecte d t o the environment seem t o have a different meanin g for two main categories o f players. On the one hand, we find firms who are involved in the production of goods and services directly connected with th e environment . On th e othe r hand , ther e ar e traditiona l industrial firms. The forme r generall y dea l wit h wate r management , industrial waste an d civil engineering, wherea s th e latte r ar e mostl y heav y industrie s (steel , chemicals , petrochemicals) or consumer good industrie s (cars, electrical appliances) . The forme r category reveal s efforts t o innovate and develop technologies that will preserv e o r improv e the qualit y o f the natura l environment. It is , however, obvious that the most of the industrial system is reluctant to take part in the process of developin g new technologies t o protect the environment . The onl y strategie s that ar e bein g develope d b y th e latte r categor y ai m a t producin g eco-product s such a s phosphate-free washing powder, lead-free petrol and CFC free aerosols . However honourable their purpose, these products do not represent more than 1 % of total household consumption. Table 3: Mai n components of the environment industry, 1990 (estimated part of the value of production, in % ) North America Europ

e Japa

n Tota

l OECD

Equipment

74

76

79

76

Water an d effluent s retreatment

24

34

22

29

Waste

25

15

22

21

Air purity control

12

17

25

15

Others (hearth preservation, noise reduction)

13

10

10

11

Services 2

62

42

12

4

Total 10

0 10

0 10

0 10

0

Source: OEC D (1992:217 )

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According t o OEC D estimate s o n th e mai n segment s o f th e so-calle d envi ronmental industries , three quarter s o f th e industry' s output include equipment produced t o protect th e environment, mainly "end-of-pipe" equipment (see Table 3). Moreover, th e OECD distinguishes three method s o f entry and thre e group s of firms in this area: - th e traditional insiders which produce equipment and goods designed for water and sewage effluent s treatment ; - th e newly-created an d innovative small an d medium-sized firms specialized in th e suppl y o f consultin g or tailore d equipmen t o n th e basi s o f specifi c know-how; - othe r firms, mainly large companies, wh o integrate the production of environmental equipmen t or service s i n a globa l diversificatio n strategy; thi s tend s to b e th e cas e i n th e engineering , chemicals an d electronic s industries , and for activitie s suc h a s toxi c wast e management , plastic s recyclin g and wast e treatment. The OECD concludes that on the basis of past experience, one can expect tha t the most likely future trend will be the continuous improvement of existing technologies an d the addition of "end-of-pipe" technologies . If this trend is confirmed as the prevailin g trend i n future technology , i t is also plausibl e that a shif t toward s more drastic changes in processes and products may be prevented. It is difficult t o avoid mentioning various inertias stemming from th e economic weight of well-known polluting sectors. They can be part of the general strategy of some industrial firms, such as PSA (Peugeot) which deliberately refused to extend the catalytic converters to the whole of the French automobile industry, or it may be the consequence o f the irreversibilit y of previous technology choices (Hourcad e 1989). One may interpret the opposition o f a large part of the French automobil e industry t o catalytic converters a s being a choice betwee n th e "ecologica l risk" and the "economic risk" o r to quote Roqueplo (1988) , between th e "direct" risk (irreversible damage t o the environment) and the "indirect" ris k (the risk carried by industrial firms, derived fro m combattin g this damage). In the case of France, Roqueplo says, PSA opposition can be explained by the fact that the German firm Bosch ha s an almost complete monopol y over the fabricatio n of the mechanica l part o f th e injectio n system. Therefore , PS A fear s tha t German industr y might have an unfair edge over the French automobil e industry (Roqueplo 1989:23) . Thus, wha t seems crucial today is that parallel to the ecological awarenes s that is dawnin g o n industrialize d countries, w e se e tha t environmenta l imperatives are givin g way t o economi c ones : i n othe r words , th e latte r ma y ver y wel l us e the forme r t o thei r ow n ends . Thi s ma y hav e differen t impacts , onl y on e o f which would serve t o protect ou r natural heritage: i ) the constraints of economic competitiveness ma y pus h environmental protection int o the backgroun d a s w e saw wit h PSA ; ii ) ecological argument s may b e use d a contrario t o legitimiz e

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some technologica l choices' ; iii ) ecological qualitie s may be use d a s a startin g point for new competitive industrial strategies . The las t propositio n i s th e onl y on e tha t fit s environmenta l constraint s but , from th e point of view of international competition, it may ver y well be diverted from it s original purpose an d use d a s a first category optio n b y non-innovating countries.

4 Nationa l Policies : Between Theoretica l Views and Social Realities For the las t thirt y years, th e economic s o f the environmen t has appeare d a s being scientificall y autonomous i n vie w of it s object , bu t orthodo x becaus e o f it s methodology. 'Environmenta l economies ' ar e base d o n th e us e o f neoclassica l micro-economic analytica l tools a s regards environmenta l protection an d preser vation of our natural heritage. 4.1 Th e Instruments o f Economic Analysis i n Environmental Polic y The basic analytical and theoretical premises o f conventional environmental economics ar e t o be foun d i n the acceptanc e o f the divergenc e betwee n th e private and socia l impac t o f micro decisions, whic h economists cal l 'externalities ' afte r Pigou. Th e apparitio n o f suc h negativ e technologica l externalitie s a s pollution could jeopardize th e efficiency o f marke t mechanism s a s far as the achievemen t of a social optimum is concerned. I f the market fails , i t is up to public authorities to mak e u p fo r thi s deficienc y to stimulat e the market . Settin g a shado w pric e to external phenomena boils down to allowing operators to integrate the external impact o f their decision int o their economic calculations . Procedures aimin g at taxing polluting emissions then becomes aki n to behaviour-rationalizing tools and to offe r a solutio n to solv e th e proble m o f incompatibl e use o f property rights . The Polluter-Pays Principle (PPP) i s one of the two cornerstones o f conventional environmental analysis, the second bein g axiomatic of rational choic e i n a world of certainty an d perfect information , base d o n methodological individualis m and on the substantive rationality postulate o f operators, whic h is more tha n obviou s in th e cost/benefi t analysis . Moreover, neoclassica l axiomatic s deriv e fro m a n "economistic reduction" of its objects. Marriage, crime , religious practice o r natural environment are all considered fro m an unidimensional point of view, i.e. i n terms o f advantages versu s costs, opportunit y cost an d maximization under constraint. Hence, al l phenomena are seen in terms of price and cost, whic h reduces any human behaviour to that of the homo oeconomicus (Bourguinat 1973; Passe t 1983).2

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Yet between fundamenta l principle s entirel y base d o n theor y an d thei r tran scription int o th e realit y o f environmen t policies , ther e ar e discrepancie s du e to estrangemen t a s wel l a s a n essentia l transformatio n relation . On e i s onl y t o take on e exampl e t o confirm thi s analysis: the PP P whic h underlies the ta x and fees attitud e toward s pollutin g emission . I n France , i t i s th e preferre d too l o f the environmenta l polic y a s far a s wate r an d wast e ar e concerned . T o AFB, th e theoretical principl e has obviously been corrupte d b y its implementation. Indeed , whereas th e taxes collected b y the Agencies wer e inspire d by a philosophy base d on internalizatio n of externalities , th e AF B hav e becom e som e kin d o f mutual benefit societies , i.e. a system whic h allows the externalization of interna l costs , "blunting the sense of personal responsibilit y of its members, wherea s taxe s wer e intended to remind each consume r of their responsibilities towards others " (Mar tin 1988:117) . Opschoor an d Vos's analysis (1989) confirms all this: indeed, while taxes hav e a two-fol d content , bot h induciv e and redistributive , they sho w tha t the latte r prevai l ove r th e former : "On e coul d conside r th e Frenc h approac h a s a pragmati c generalizatio n o f th e Polluter-Pay s Principl e (PPP) i n a situation o f powerful interests : th e polluters i n general d o raise th e fund s necessar y fo r realizing environmental objectives an d efficiently allocat e funds , bu t the reallocatio n of thes e fund s take s th e for m o f financia l assistance , a s decided b y th e polluter s themselves" (Opschoor/Vo s 1989:29) . Then the y poin t ou t tha t thi s redistributiv e aspect whic h doe s no t fi t i n wit h the induciv e nature of th e polluter-pay s theory, i s full y applie d i n Franc e a s fa r as air and wate r are concerned. I n this case, taxes collecte d b y th e AQA are too small to have an inducive effect, wherea s 90% of their total is handed to the actual polluters a s subsidie s to bu y monitorin g equipment. Onl y 10 % of th e fund s ar e allocated t o help technologica l researc h (Opschoor/Vo s 1989:35-36) . The appropriation of analysis tools develope d withi n the neoclassical mode l by economic an d politica l decision-makers , pose s tw o problems : i ) thei r status , i n terms o f a legitimizing tool tha t is being use d an d over-used ; ii ) their relevance . The firs t aspec t ha s bee n ver y wel l describe d b y Hourcad e (1991 ) an d Godar d (1990) wh o rigorousl y showe d tha t any economic calculatio n only make s sens e in concret e condition s of negotiation and the behaviour of operators s o that eco nomic rationality then becomes the "tool of legitimacy and a weapon fo r strategic domination" (Godard 1990:222) . The second aspec t refers to the relevance of the analysis as a reference fo r the choice o f both the objectives and instruments of the environmental policy, as well as its relevance in terms of a medium of information necessary fo r the decision-making process . As regard s thi s las t point , safeguardin g th e condition s o f optimalit y o f ou r natural heritag e i s often take n fo r grante d a s soon a s externa l factor s hav e bee n corrected, i.e. as soon a s polluters are paying. This principle, owing to its implicit moral aspect , ma y firs t appea r ver y attractive ; bu t i t nevertheles s pose s man y problems. Firstly , "the ver y notio n o f externalit y i s ambiguous . I t presuppose s that on e can , a t th e basic fundamenta l level , isolat e wha t strictl y belongs t o th e

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operator o r th e firm concerned , fro m wha t belongs t o othe r operators , o r othe r firms or groups. .. . I s it not paradoxical i n an increasingly interdependent world to claim to isolate factor s belonging to a specific unity from exterior influences?" (Bourguinat 1973:1526) . S o wha t o f th e futur e environmenta l consequences o f decisions tha t ar e bein g take n today ? A s a corollar y t o this , ther e remain s th e question of inter-temporal allocation, inasmuc h as the preservation of our natural heritage ma y appear a s an imperative for the transmission of natural assets fro m generation to generation. Thus, the basic neoclassical tool s (such as price system, efficient allocation ) canno t accep t a n inter-tempora l dimension , a n impossibl e matching between presen t supply and future demand to use and enjoy the natural environment (Henry 1990) . As far as the doctrinal inspiratio n of environmental policies is concerned, th e neoclassical model 3 seems to be gaining in importance; this is the consequence of the shift in both means and objectives towards a market dimension in most industrialized countries . Often , the 'command-control ' regulatin g attitude based o n a set of legal measures is being replaced by liberal inducive, correcting mechanisms that are both allocativ e and market oriented. The archetype would be the "right s to pollute markets". This is disquieting since i t assumes tha t it is possible t o set efficient contro l mechanisms , tha t the level s of toleranc e an d th e wa y pollution arises are well known. But all these conditions are far from bein g met. The neoclassica l approac h ca n b e characterize d b y it s stati c reasoning , it s allocative regulatio n an d 'economisti c reduction' . Thes e element s ca n b e dis cussed an d use d wit h a vie w t o reformulatin g institutionalist thinkin g tha t can be discerne d her e an d ther e (Söderbau m 1990a , 1990b) . Afte r underlinin g the methodological option s involved , w e shal l sho w tha t thi s approac h ha s a two fold merit : fro m a heuristic poin t of view , i.e. understandin g and knowledg e of phenomena, and from th e point of view of analyzing environmental policies. 4.2 Environmenta l Protectio n as Central to Social Attitudes an d Technological Choices The arguments can be summed up in four points : 1. Th e degradatio n o f th e environmen t and o f natura l ecosystems i s mostl y irreversible. Therefore, as Söderbaum rightly pointed out, the cost/benefit analysis becomes inappropriat e for "such an analysis is based on the idea that processes are reversible an d that everything can be traded of f in monetary terms" (Söderbau m 1990b:3). 2. Th e environmenta l effects o f industria l and technologica l choices ar e un certain. From a political viewpoint, this implies the need t o establish procedure s to gai n information and knowledg e over a long period o f time , to mobiliz e an d create specific expertise capacities in order to take into account the complexity of phenomena involved in the formation of pollution (Roqueplo 1990) .

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3. Environmenta l problem s ar e bot h multi-dimensiona l and complex . The y cannot be reduced t o merely problems o f money, price an d cost. This complexity is due to the interdependence o f effects, t o the accumulation of phenomena as well as to social psychology. For example, the treatment of industrial waste causes new forms of pollution, especially as regards th e release o f fumes int o the atmosphere . It would be possible to reduce these emissions by organizing selective specialize d procedures t o recycl e thi s waste , bu t thi s woul d impl y selectiv e collectio n o f waste, therefor e a change i n the behaviour of operators, particularl y households . 4. Solutions to preserve the environment also have a moral dimension inasmuch as they commit societ y as far as future generations are concerned. Consequently, i t woul d see m usefu l t o plac e th e emphasi s o n th e fac t tha t the preservatio n o f th e environmen t i s a questio n o f technolog y a s wel l a s o f economics and social attitudes. The assumption contains the prerequisites to draw up an institutional concept whic h would meet three imperatives. The first has to do with takin g into account of time and history. The secon d deal s wit h institutiona l machinery, structures and legislation which requires stud y in terms of rationality, evolution an d th e issue s a t stake . Th e latte r i s concerne d wit h socia l attitude s beyond their mere homo oeconomicm aspects. O n this last point it is obvious that any meaningfu l analysi s must b e base d o n a n endogenizatio n o f costs , values , institutions and technologie s a s wel l as on conflict s betwee n differen t group s of players (Soderbaum 1990b) . This bring s u s back t o the theoretical institutionalis t framework whose majo r contribution i s t o expres s th e relationshi p between th e natur e o f th e evolution of socia l institution s and industria l societies i n terms o f technologies an d socia l behaviours. As Soderbau m rightl y pointed out , the success an d efficiency o f any national policy depend o n the legal provision and regulation imposed b y the stat e and on the jurisdiction and behaviour of local councils, particularly the behaviour of privat e operators, whethe r firms or households. Thus, "th e succes s or lack of success o f som e particula r institutiona l arrangemen t wil l largel y depen d o n th e people concerned , thei r values, attitudes and behaviours" (Soderbau m 1990b:5) . From tha t point of view , preserving th e environmen t and ou r natura l heritage can be envisaged in an alternative way from the one favoured by both neoclassica l economists and engineers. Th e former are essentially concerned wit h two things: firstly, to 'ge t the price right ' an d secondly, t o establish a coherent structur e for property right s (Swaney 1987) . The latter are only interested in finding technical solutions to technical problems. While there is no denying that these two attitudes are important , on e shoul d nevertheles s avoi d th e pitfall s o f 'economistic ' o r 'technical' reductions . Of course , th e preservatio n o f th e environmen t has bot h economic an d technical dimensions; but it is also an ethical and socia l issu e that challenges our modes o f thinking, attitudes and social institutions . Society i s not seen a s a accumulatio n of operators , bu t rathe r a s a n organi c bod y deservin g holistic and historical analysis. This dimension is important inasmuch as it makes it possibl e t o understan d today' s environmenta l problem s i n th e ligh t o f pas t

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thinking and social concepts. T o illustrate this argument, one could quote the case of pollution connected t o abnormal rainfalls in France. Indeed , present drainage systems in France ar e based o n an 'hygienic ' approach expressed i n the 189 4 law on sewage . Accordin g t o thi s view , drainage entail s gettin g ri d o f liqui d waste through a network o f sewers an d drains. Between 191 8 and 193 9 the first water purifying plant s were created . T o prevent these plant s from bein g overloade d b y rainfalls, rai n outlets were installed in the primary network in order t o discharg e into lakes , river s o r th e se a the rain-water/liquid-wast e mixture with which th e purifying plants could not cope. These rain outlets today seem to spread pollution since the y diffus e pollutant s containe d i n rai n water . I t i s onl y recentl y tha t new technique s differen t fro m th e 19t h centur y hygieni c approac h hav e bee n investigated. Instead of draining water out of the urban environment, no one tries to slow down the flow (Desbordes e t al. 1990) . Finally, as has been show n by many analysts (Henry 1990 , Söderbaum 1990a , Swaney 1987) , there i s uncertaint y as t o th e consequence s arisin g from th e ig norance o f th e ecologica l chai n o f caus e an d effect . Ther e i s stil l considerabl e uncertainty today. It implies that the underlying behaviour of operators canno t be anything other than procedural, and this also affects publi c decisions. As a result, government decision s ar e ofte n short-sighte d du e t o a lac k o f knowledg e about what accelerates the process of degradation or how to help preserve our ecologica l heritage.

5 Conclusio n The preservatio n o f th e environmen t has bot h a paradoxica l an d a n ambivalent relationship with social institutions and technology. If technology ca n be defined as "knowledge abou t how to do things" (Samuels 1977:872) , then it is undeniable that "many environmental problems aris e as unintended by-products of economic activity and therefore involves the application of knowledge to the material world " (Swaney 1987:1748-1749) . O n th e on e hand , th e developmen t o f technolog y affords mankin d more opportunitie s to damag e it s natural environment. On th e other hand, preserving this environment requires the development of technology. This is only feasible and viable if there are social forces willing to cooperate and work towards this goal and if national policy measures contribute to an awarenes s of fundamenta l issues an d institutiona l steps take n t o giv e the m tangibl e form. While institutionalist economists se e the evolution of society as being the product of variou s tensions between technologica l an d institutiona l progress, i t mus t be admitted tha t th e protectio n o f ou r natura l heritag e call s fo r a rethinkin g of technologies an d social institutions. It is true that the institutionalist theory marks a certai n technologica l determinis m (Samuel s 1977) . However , technolog y i s unquestionably a socia l artefac t an d th e technologica l options take n depen d o n

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factors themselve s determine d b y powe r structure s an d th e attitude s prevailin g within societ y a s a whole . I f on e share s thi s view , i t the n become s possibl e t o think in terms of dynamic adjustment between the evolution of society and that of institutions i n a framewor k o f reciprocity determine d an d structure d by nationa l policies. We believe that such a perspective can serve to re-appraise the relationship between technology, social institutions and the preservation of our natural heritage. To monitor this imperativ e requires thorough knowledge of the problem, i.e. a ful l understanding of social phenomena and ecosystems with all their complexities.

Notes [1] Thi s is especially tru e o f nuclea r energy . Som e politica l group s hurriedl y justified i t and exclude d i t from th e public debate, simpl y becaus e i t caused les s pollution than traditional plants. [2] Neoclassica l economic s onl y deal i n abstract concept s an d i s not intereste d i n socia l facts a s defined by Emile Durkheim (1983) . [3] A corollary t o this, thi s mode l see s the environment limited in economic terms . Th e various elements of Nature are viewed as public goods, since supply regularly outstrips demand. I t would see m mor e appropriat e t o talk i n terms o f "pseud o publi c goods" which, inasmuc h a s the y ar e rare , hav e n o marke t valu e an d lea d t o incompatibl e demand.

References Abdelmalki, L., Th. Kirat (1991) Le s politiques de l'environnement au defi d e la maitrise sociale d e l a technologie , pape r prepare d fo r th e symposiu m Th e Socia l Master y o f Technology: Issue s an d Methods', Lyon. Allen, R.C. (1983 ) Collective Invention, in: Journal o f Economic Behavior and Organization (4) : 1-24 . Ayres, R.U . (1989 ) L e metabolism e industrie l e t le s changement s d e l'environnemen t planetaire, in: Revue Internationale de s Sciences Sociales 121 : 401-412. Bernadet, M. , J.C. Lasserr e (1985) Le secteur des transports, Paris : Economica . Billaudot, F . (1991 ) Le s mutation s administrative s d e l'environnement : aspect s d e l'application d u Pla n Nationa l pou r 1'Environnement , in : Revue Juridique d e I'Environnement 3 : 333-353. Bourguinat, H. (1973) L'economiste et l'environnement: propos liminaires , in: Economies et Societes f, 25 : 1513-1537 . Cans, R. (1990) D e mauvais tuyaux, in: Le Monde, 3 1 October. Chartier, P. (1990) Recherche technologique , energi e et environnement, in: Le Monde, 1 7 October. Desbordes, M. , J.C . Deutsch , A . Frero t (1990 ) Le s eau x d e plui e dan s le s villes , in: La Recherche 22 1 (21): 582-589.

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Dosi, G. (1988) Sources, Procedures, an d Micro-economic Effects o f Innovation, in: Journal of Economic Literature 3 (27): 1120-1171 . Drouet, D. (1987) Les acteurs du genie urbain en Europe: des structurations tres contrastees, paper prepared for the 'Seminaire Europeen L'innovation et la recherche en genie urbain', Lyon: Institut National du Genie Urbain. Dufourt, D. (1991) Les politiques technologiques: une nouvelle rationalite de l'intervention de 1'Eta t dan s l e System e productif?, in : J . D e Bandt , D . Fora y (eds. ) devaluation economique d e l a recherche e t d u changement technique, Paris : Edition s d u CNRS , 351-380. Durkheim, E. (1983) Les regies de la methode sociologique, Paris : Presses Universitaires de France . Enel, F. (1987) La metrologie et la gestion de s reseaux d'assainissement, Paris: Ministere de la Recherche, Minister e de l'Equipement. Ergas, H . (1987 ) Th e Importanc e o f Technolog y Policy , in : P . Dasgupta, P . Stoneman (eds.) Economic policy an d technological performance, Cambridge , MA : Cambridg e University Press, 51-95 . Godard, O. (1990) Environnement, modes de coordination et systemes de legitimite: analyse de la categoric de patrimoine naturel, in: Revue Economique 2 (41): 215-242. Henry, C . (1990 ) Efficacit e economiqu e e t imperatif s ethiques : I'environnemen t e n co propriete, in: Revue Economique 2 (41): 195-214 . Hippel, E. von (1988) Th e Sources of Innovation, Oxford: Oxford University Press . Hourcade, J.C.( 1991) Calcul economique et construction sociale des irreversibilites: legons de 1'histoir e energetique , in : R . Boyer , C. Chavance , O. Godar d (eds. ) Le s figure s d e I'irreversibilite en economic, Paris: Edition s de l'EHESS, 279-310 . Jamison, A . (1989 ) Technology' s Theorists : Conception s o f Innovatio n in Relatio n t o Science an d Technology Policy, in: Technology and Culture 3 (30): 505-533. Kemp, R. , L . Soet e (1990 ) Insid e th e 'Gree n Box' : O n the Economic s o f Technologica l Change an d the Environment , in: C. Freeman, L . Soete (eds.) New Explorations i n the Economics o f Technological Change, London, New York: Pinter, 245-257. Kirat, Th. (1990 ) Le s normes , instrument s de gestio n d e Γ innovation?, in : Economies e t SocietesSG, 15: 165-191. Kline, S.J., N. Rosenberg (1986) A n Overview of Innovation, in: R. Landau, N. Rosenberg (eds.) The Positive Sum Strategy, Washington D.C.: Nationa l Academy Press, 275-306. Le courner du CNRS (1989 ) 72. Mallevialle, J. , Th . Chamboll e (1990 ) L a qualit e d e l'eau , in : L a Recherche 22 1 (21) : 598-606. Martin, Y. (1988) Quelques reflexions su r revolution de s Agences de Bassin, in: Annales des Mines July-August: 117-119. Nelson, R . (1959 ) Th e Simpl e Economic s o f Basi c Scientifi c Research , in : Journal o f Political Economy 3 (67): 297-306. Nelson, R., S . Winter (1982 ) An Evolutionary Theory o f Economic Change, Cambridge , MA: Belknap. OECD (1992 ) Technologie et Economic, Paris: OECD. Opschoor, J.B. , H.B . Vo s (1989) Economic Instruments fo r Environmental Protection, Paris: OECD . Passet, R . (1983) L economique e t le vivant, Paris: Payot.

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Quinet, E . (1990 ) Analyse economique de s transports, Paris : Presse s Universitaire s de France. Roqueplo, Ph . (1988 ) Le s enjeu x d e l a reglementatio n europeenn e pou r le s ac teurs economiques : l'exempl e d e l a pollutio n d e l'air , pape r a t th e 'Tournee s d e l'environnement du CNRS, "Le Droit et l'environnement" ' . Roqueplo, Ph. (1989 ) L'ecologi e est-elle en train de rapprocher la France et la R.F.A. ou de les separer?, Discussion paper at the Fondation Saint-Simon , Paris. Roqueplo, Ph. (1990) Comment evaluer les recherches destinee s ä fonder l a fiabilite d'un diagnostic? Exemple des problemes globaux d'environnement, in: Journees CNRS sur I'interdisciplinarite, 1 2 February. Samuels, W.J. (1977) Technology vis-ä-vis Institutions in the JEI: A Suggested Interpretation, in: Journal o f Economic Issues 4(11): 871-895. Secretariat d'Eta t charg e d e l'Environnemen t (1989 ) Donnees economiques d e l'environnement, Paris: La Documentation Fran9aise. Söderbaum, P. (1990a) Neoclassical an d Institutiona l Approache s to Environmenta l Economics, in: Journal o f Economic Issues 2 (24): 481-492. Söderbaum, P. (1990b) Neoclassica l an d Institutional Approaches t o National an d Private Environmental Policy , paper presente d t o th e 'Annua l Conferenc e o f th e E.A.E.P.E.' , Florence. Swaney, J. (1987) Element s of a Neo-institutional Environmental Economics, in : Journal of Economic Issues 4 (21): 1739-1779 . UN/ECE (1988 ) Regiona l Strateg y fo r Environmenta l Protection an d Rationa l Us e o f Natural Resource s i n EC E Countrie s Coverin g th e Perio d u p t o th e Yea r 200 0 an d Beyond, in: Environmental Policy and Law 5 (18): 175-186 .

The Historical Developmen t o f Japanese Science and Technology Polic y i n Conjunction wit h Socio-economic Polic y Masahiro Kawasaki

1 Introductio n Today, science an d technology policy is highly ranked in the policy priority area s of both public and private sectors throughou t the world. It is well recognized tha t science an d technolog y i s a driving force fo r economic an d socia l development . It i s furthe r recognize d tha t recen t change s i n th e mod e an d mechanism s o f science and technology developmen t an d innovation, as well as the globalizatio n of technology , ar e havin g profound impact s o n th e policy-makin g environment. On th e basi s o f thes e change s i n scienc e an d technology , transformation s ar e also occurrin g i n East-Wes t relation s an d th e relationshi p betwee n develope d and developin g countries . Fo r Japan , th e changin g circumstance s ar e forcin g her scienc e an d technolog y polic y t o mov e towar d ne w approache s whic h tak e into accoun t he r global leadership-sharing position . A t thi s turnin g poin t i n Japanese scienc e an d technology , an d in order t o lear n fro m th e past , thi s pape r aims to review the historical development o f that polic y - particularl y focusing on it s relationshi p wit h socia l an d economi c changes . Severa l epoch-makin g recommendations o f th e Counci l fo r Scienc e an d Technolog y (CST ) shal l b e reviewed sinc e the y propose d th e overal l S& T polic y framewor k fro m tim e t o time, reflecting upon the socio-economic goal s of the time. From th e author's overal l view , Japan gave high priority to the development of science an d technology as an indispensable factor in her industrial and economi c restoration following World War II. Then throug h the decade of the 1960s , the era of hig h growth i n the Japanese economy , thi s recognitio n wa s strengthened . A s such, i t formed th e basi s o f Japanes e scienc e an d technolog y polic y unti l 1984 . During that period, Japanes e S& T policy did not focus independently on scienc e and technology development - in particular, science policy - but also on how S&T can contribute to solve economic an d social problems. Thus, S&T policy worke d as a tool for societal an d economic policy . In 1984 , however, the CST proposed a new direction for S&T polic y that gave a high priority to the progress o f scienc e and technology withi n the overall policy framework. This was a dramatic chang e of S&T policy . In this direction, there ha s been a policy shif t t o strengthen basi c research an d t o promot e creativ e scienc e an d technology . Thi s shif t seem s t o

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bring about today's S&T policy issues, since they derive mainly from the friction s between ne w policy objectives an d the traditional institutions. Throughout thi s paper, th e author wil l presen t wha t can b e learne d fro m pas t Japanese experience , i n orde r t o see k ne w direction s fo r a ne w S& T polic y framework.

2 S& T Institutional Framework and S&T Policy as Built into Industrial Policy (1945-1955) During the period fro m 194 5 to 1950 , various governmenta l actions wer e taken . Together, thes e forme d th e institutiona l framewor k o f scienc e an d technolog y policy fo r postwar Japan . World War II completely destroye d livin g conditions, industry and economy in Japan. In the period fro m 194 5 to the beginning of the 1950s , Japan was forced to build up both industrial and economic capabilitie s from a "zero" base of social and economic fundamental s - suc h as lack of raw materials, consumer goods, industrial production capacities , capital an d foreign currency, etc. The demobilization of the militar y resulted i n high unemployment. Under the guidanc e of the GH Q (General Headquarter s o f th e Occupatio n Force s i n Japan) , polic y priorit y wa s given to urgent counter-measures to overcome both the lack of basic materials and vicious inflation, a s well as to reconstruct th e base o f economic activities . Along these lines, the major policy goal was to regulate the supply of food and industrial products (Rinji Busshi Jukyuu-Chousei Hou [La w of Provisional Measures of Coordination o f Supply and Demand of Goods], 1945) . The Top Priority Production Policy o f Coal, Iron an d Steel (Sekitan, Tekkou w o Suuten to suru Keisha-seisan Seisaku, Cabinet decision , February 1946 ) wa s adopted b y the Cabinet, in orde r to restore the overall industrial base of Japan. In this way, the Japanese econom y took a path of recovering its footing, coupled wit h the special procurement boo m of the Korean War (1950-1953). Likewise, th e GH Q too k severa l action s t o eliminat e militar y R& D an d t o shift scienc e an d technolog y structur e toward s peacefu l purposes . I n 1947 , th e Gakujututaisei-Sasshin-Iinkai (Advisor y Committe e fo r th e Refor m o f Scienc e and Technology Organizations ) wa s established. I n the next year, this committee recommended to the Prime Minister that (i) the government establishes the Science Council of Japan (JSC), o f which all members ar e to be elected b y scientists and engineers themselves; and (ii) the Science and Technology Administration Council (STAC ) b e organize d a s a n administratio n body fo r scienc e an d technolog y policy. The chairma n of STA C was the Prim e Minister , and its member s wer e constituted b y th e administrativ e Vice-Ministers o f al l ministrie s an d agencie s concerned - a s well as several wise men appointed by the Prime Minister. STAC

The Historical Developmen t o f Japanese S&T Policy 28

1

was obliged t o (i) coordinate overal l scienc e an d technology policie s conducte d by variou s ministrie s and agencies , (ii ) promote internationa l cooperation i n th e field of science an d technology, and (iii) take an y administrative actions require d to implemen t JS C recommendations . Bot h th e JS C an d th e STA C wer e estab lished i n 1949 . A t th e sam e time , th e Ministr y o f Commerc e an d Industr y (th e predecessor of th e present MITI ) established th e Agenc y o f Industrial Technol ogy (the predecessor of the present AIST of MITI) based o n the recommendatio n of GHQ, i n order t o promote industria l technology. I n addition t o thes e actions , there wa s a reform o f other scientifi c institutions , mainly universities, under the National Schoo l Act ; an d statistics were introduce d t o R&D unde r the Statistics Act of 1947 . Over the period, i t can be said that Japanese science and technology policy was firmly formulated a s an importan t tool o f Japanese industria l policy. I n order t o develop Japanes e industria l structure both quickly and smoothly - a realization of the shift from light industry to more lucrative heavy and chemical industries - the government provided variou s industrial policy measures. First, in order to regulate both foreig n exchang e an d trad e an d t o guarante e foreig n investmen t i n Japan, two laws were respectivel y established : th e Act for Control of Foreign Exchang e and Trade i n 1949 , an d the Act for Foreign Investmen t in 1950 . Both acts provided effective policy tools, not only for the improvement of the industrial structure, but also for the development of Japanese industrial technology. This laste d unti l 1967 , when the government adopted th e liberalization policy of trade and capital transaction (Japan became a member of OECD and of the article 8 of IMF in 1964). In 1949, the Act for Industrial Standardization came into force; and in 1952 , the government provided the Act for Promotion o f Industrial Rationalization and the Government Order of Tariff Exemptio n for Import of Important Equipments an d Machines . Al l worke d toward s acceleratin g th e modernizatio n of manufacturing industries. Under the Foreign Investmen t Act, th e governmen t operated th e stric t screenin g o f technolog y impor t wit h th e promotio n o f do mestic industr y in mind . This screenin g adopte d impac t analysi s for smal l and medium-sized enterprises, assessmen t o f export-promotion an d import-reduction potentials, and market analysis of products derive d fro m importe d technologies . In addition , reflectin g upo n the speec h o n the peacefu l us e o f nuclea r energ y presented b y President Eisenhower of the United States a t the General Assembl y of th e Unite d Nation s i n Decembe r 1953 , Japa n se t u p a nuclea r energ y R& D budget fo r th e fisca l yea r 195 4 o n th e basi s o f a proposa l mad e b y th e Hous e of Representatives . I n thi s connection, th e JS C declare d th e thre e guidin g principles o f nuclear energ y R& D - tha t is , opening t o the public, democratic an d autonomous, in order t o ensure th e peacefu l utilizatio n of nuclea r energy. The y were incorporate d i n th e Basi c La w Fo r Atomi c Energ y an d th e Establishment Act of Atomic Energy Commission, enforced i n 1956 . Since then, these guiding principles were applie d to various features of science and technology policy - in particular, to governmental major scientific programs , suc h as the space develop -

282 Masahir

o Kawasaki

ment program. I t must be noted tha t these principles have mapped ou t the overall science an d technology policy until today: science and technology activities must be directed towards peacefu l purpose s i n Japan. In 1953 , afte r Japan's economi c recover y fro m th e destructio n o f war , Japan began to set policy targets focusing on the future progres s o f Japanese economy . The Keizai Singikai (th e Counci l o f Economy , th e highes t advisor y boar d t o the Prime Minister , established i n 1952 ) recommended t o the Prime Minister an integrated polic y framewor k fo r buildin g up a self-sustainin g economy. I n thi s recommendation, th e Council proposed the following three goals and fourguiding principles fo r economic independence : Goals: 1. Normalizatio n of trade, i n particular promotion o f export. 2. Improvemen t of self-supply; capability through development of domestic natural resources . 3. Buildin g up economic capacit y through capital accumulation. Principles of Action: 1. Stabilizatio n of the economy . 2. Self-suppor t o f main economic constituents . 3. Cooperatio n betwee n capita l an d labor. 4. Promotio n of science an d technology. In this context, the government formulated the Five-year Plan for Self-supporting Economy in December 1955 . Part 2 of this plan stressed th e promotion of science and technolog y a s a n importan t polic y priorit y fo r attainin g its goals . Behin d this plan , a significan t consensu s wa s forme d amon g leadin g economist s an d government officials: th e White Paper on Japanese Economy o f 195 6 proclaimed, with a n illustratio n of a n analysi s of Japanes e economi c development , tha t th e increase o f investment initiated by technological innovation wa s a key factor of economic growth (Economic Planning Agency 1956 ; Commissio n on the History of Scienc e an d Technolog y 1991:84) . Also , th e White Paper declare d tha t th e postwar perio d wa s over , sinc e th e Ne t Nationa l Incom e pe r capit a i n 195 5 exceeded the peak o f the prewar period . During thi s period , th e governmen t als o launche d ambitiou s plan s throug h public endeavours to improve socioeconomic infrastructur e throug h such public entities as Nippon Telephone an d Telegram (th e predecessor o f NTT) an d Japan National Railwa y Corporatio n (divide d int o nin e privat e companie s i n 1987) . These plans presented stabl e market s t o industry and played a significant role t o stimulate industrial R&D in the respective field of new technologies, parallel with improvement plans for other infrastructures. NTT began to construct a microwave telecommunication network between Tokyo and Osaka in 1954 and completed th e nation-wide network in 1957. Japan National Railway achieved the electrification of all lines by 195 6 and in 1958 started the development program of the Shinkansen

The Historical Developmen t o f Japanese S& T Policy 28

3

system ( a very high-speed railwa y system), operated in 196 4 between Toky o and Osaka, a s the New Tokaido Lin e (i.e. Shinkansen).

3 Towar d the Integration of Science an d Technology Polic y under Economic Growt h and Liberalization Polic y (1956-1969) Innovations during the 1950 s and 1960 s were mainl y achieved b y th e intensive importation o f advance d industria l technologies fro m Wester n countries , arme d with th e lega l framewor k mentione d above . Togethe r wit h those intensiv e imports, includin g technology managemen t suc h as the QC , variou s sectors o f the industry mad e enormou s effort s t o buil d u p indigenou s R&D capabilitie s (se e Table 1 and Figure 1) . Based on the good matc h of technology import and indigenous R& D effort s an d guide d b y th e governmen t (fo r instance , wit h long-term low-interest loan s fro m th e Developmen t Ban k of Japan: se e Table 2) , Japanes e industry rationalize d and modernize d it s productio n facilities, thu s building up the prerequisite s fo r catchin g u p wit h more advance d countries . Completion of catching-up was seen i n the textile, camera, sawin g machines, ship-building, iron and stee l industrie s during th e first half - o f the 1960s ; an d sign s o f building catching-up potentia l were see n i n th e chemical , machin e an d electrica l equip ment industries . Furthermore, ne w industrie s were launche d during this period : such a s th e petrochemical , syntheti c fiber, and electronic s industry , etc. Fo r th e machine industry, the government provided in 195 6 the Act for the Promotio n of the Machine Industry ; and als o i n 1957 , i t enacted th e Ac t fo r Promotio n o f th e the Electronics Industry . This provide d ta x exemptions and financial support fo r joint R&D projects, suc h as for color TV s and computers, etc . As for industrial R&D activities during the 1960s, it is noted that major companies began to establish central or corporate research institutes . Figure 2 shows the number of research laboratorie s established in the industry. The R&D expenditure of private industry increased remarkably, as is shown in Table 1 . Under a policy of high economic growt h during the 1960s , Japanese industr y not only expanded its scale but also developed its own R&D constitution. It is commonly explained that high economi c growt h i n 1960 s wa s cause d b y th e mechanis m tha t investment invites further investment. This industrial investment was targeted no t only to production capabilitie s but als o t o R&D . Gradually , indigenous R&D upgrade d it s potential to an extent sufficient fo r competing with more advanced countries. The electronics and communications industries particularly built up their potentials to develop an d commercialize product s such a s the 1 C calculator in 1967 , the lase r in 1965 , th e LSI i n 196 9 and optica l fiber s i n 1970 .

284

Masahiro Kawasaki

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Correlation coefficien t 1.0 0.8 0.6 0.4 0.2 0

61 6 2 6 3 6 4 6 5 6 6 6 7 6 8 6 9 7 0 7 1 7 2 7 3 7 4 7 5 7 6 7 7 7 8 7 9 8 0 8 1 8 2 8 3 8 4 Year

Figure 1 : Correlatio n coefficient s o f technology impor t and R&D expenditure In this figure, I used R 2 for the explanation of correlation betwee n R&D expenditure and the payment of technology import instead of r usually used (refere d to Kodama 1991 : 58). The Rang e of R 2 i s from 0 to 1. 50r

40

30

20 10

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'51 '5 3 '5 5 '5 7 '5 9 '6 1 '6 3

'67 '6 9 '7 1 7 3 7 5 7 7 7 9 '8 1 '8 3 '8 5

Figure 2: Th e tren d of the annual number of establishment of corporate lab s Source: Commissio n on the History of Science an d Technology Polic y (1991:217)

At the government level, despite th e STA C playin g its own coordination rol e over th e past period, voices o f individual industry-related ministries were domi nant in approval procedures fo r technology import, etc. In addition, there appeared a serie s o f new S&T policy issues whic h required stron g coordination a t the national level : nuclear energy, aeronautical and materia l R&D . I n cope with thes e urgent issues , seriou s discussion s aros e in Parliament, industr y and government regarding ho w government organization fo r science an d technology should b e

287

The Historica l Developmen t o f Japanese S& T Polic y Ministry o f Agriculture, Forestry an d Fisherie s Science an d Technolog y Agency (STA ) (T) Coordinatio n and overall policy-making ©R SD of basic and common natur e (exclusive o f R&D inuni versities) (3) Big sciences, e.g. nuclea r space ocean.etc.

Ministry o f Internationa l Trade an d Industr y (MITI ) Ministry of Healt h an d Welfare Ministry o f Transport Ministry o f Labou r Ministry of Post an d Telecommunications

Ministry of Education , (supporting Science an d Culture university research ) Figure 3: Administrativ e structure of S&T policy (functiona l chart )

organized. Accordingly , th e governmen t abrogate d STA C an d trie d t o integrate overall administrativ e activities for scienc e an d technolog y policy . A s a result, the Science and Technolog y Agenc y (STA ) wa s established i n 1956 . Also , ne w governmental R& D organization s fo r nuclea r energy, materia l and aeronautical S&T wer e establishe d unde r ST A during th e perio d fro m 195 6 t o 1959 . Thus , today's administrative structure for science and technology polic y was principally formed durin g this period (se e Figure 3). In particular, the establishment of STA in 195 6 wa s accepte d a s a clea r polic y sig n tha t th e promotio n o f scienc e an d technology ha d becom e one o f the priorit y polic y issue s a t the ministr y leve l in Japan. Not surprisingly, there were serious conflicts among the existing ministries about wha t competences th e ST A should have . The responsibilitie s o f th e STA were defined a s follows: - t o coordinate al l governmental R& D undertaken b y ministries and agencies, but not by universities (this was managed b y the Ministry of Education); - t o formulate national S&T policy (except universit y policy); and - t o promote the development of major comprehensive scienc e and technology such as nuclear energy, aerospace, material science an d processing . Several R&D organizations were newly established under the STA, which include the - Nationa l Aerospace Laborator y (NAL) , in 1956; - Nationa l Research Institut e of Metal (NIRM) , in 1956 ;

288 Masahir

o Kawasaki

- Japa n Atomi c Energy Researc h Institut e (JAERI), in 195 6 (calle d "Tokushu Hojin", a semi-governmental entity which shares mos t o f it s capital wit h the government); - Nuclea r Fuel Corporatio n (Tokushu-Hojin , the predecessor of the Power Reactor and Nuclear Fuel Development Corporation PNC) , in 1956 ; - Nationa l Institute of Radiological Science (NIRS) , in 1957; - Japa n Informatio n Center o f Scienc e an d Technology (JICST , o r TokushuHojin), in 1957;an d - Institut e of Physical and Chemical Research (RIKEN) , in 1958. In spit e of the restructuring attempt, there has stil l remained fro m th e viewpoint of efficiency o f policy formulation, a question of how to coordinate and integrate university activitie s int o nationa l S& T policy . I n respons e t o thi s question, th e Council for Science and Technology (CST) was established in 1959 as the highest advisory board of S&T policy. The role of the CST is to make recommendations on science and technology policy (including university research policy) at the national level, as well as to coordinate scienc e an d technology activities conducted by all ministries an d agencies. Th e chairman of the CST is the Prime Minister; and its members are composed of the Minister for Science and Technology, Minister for Education, Finance Minister, Minister for Economic Planning, the President of the JSC an d five experts designated b y the Prime Minister. In addition, any minister could participate in the plenary meeting of the CST. Therefore, th e CST's function can b e recognized no t only as a pure advisory board, bu t also as a Cabinet-like body on science and technology policy . The legal status and legitimate functions of STA and CST have not changed until today, although the CST has been required from time to time to strengthen its overall coordination function of S&T activities. Given the function o f the CST, Japan's S&T policy-making structure has obtained integrity at the Cabinet level in conjunction with other policy issues , particularly industrial and economic policy . Just after the establishment of the CST, a n inquiry was conducted by the Prime Minister on a comprehensive S&T policy framework for the 1960s . At the sam e time, the Council of Economy prepared a recommendation to the Prime Minister on a new directio n fo r economi c policy , reflecting that Japanese economi c an d industrial performanc e ha d reache d thei r goal s i n term s o f annua l growth rat e of th e GNP , development o f industria l structure and improvemen t of balance of trade as settled by the New Long-term Economi c Plan of 195 7 (see Tables 3 and 4). In 1960, both councils presented recommendations on science and technology policy and on economi c policy , respectively. The recommendatio n of the CST was recognized a s the first overall policy framework fo r science and technology. Moreover, th e economic polic y framework called the National Income Doubling Plan presente d a way to realize high economic growth . Both of them positively affirmed tha t science an d technology were key factors in economic and industrial development and that S&T policy had a close linkage with economic policy. The

The Historical Developmen t o f Japanese S&T Policy 28

9

structure of the recommendations ar e described i n Table 5 , showing that overall S&T polic y wa s strongl y consolidate d i n economic growt h policy . Along thes e lines, th e ST A established th e Researc h an d Developmen t Corporatio n o f Japan (JRDC) i n 1961 , wit h th e functio n o f encouragin g th e transfe r o f R& D result s from nationa l research institute s or universities to industries. Table 3: Annua l growth rat e of GNP (% ) Nominal ter m Actua

l term

1950

16.9

12.7

1951

37.9

13.6

1952

12.4

9.3

1953

15.8

8.2

1954

5.0

3.6

1955

10.3

9.6

1956

12.8

8.5

1957

8.4

7.0

1958

2.7

5.1

1959

20.8

17.3

Average annua l rates: 1947-1952: 11.5 % 1953-1958: 6.8 % 1953-1959: 8.3 % Source: Okit a (1960:6 )

This industry-oriente d natur e of science an d technology polic y i s also see n i n the CST recommendations whic h followed, while the goal of policy was changed from economi c growt h t o open-doo r economi c policy . I n 1966 , th e CS T pro posed a ne w policy framewor k t o cope wit h th e emergin g open-doo r economi c system. I n particular , th e CS T focuse d o n th e internationa l competitivenes s is sues o f Japanes e industr y in complianc e wit h th e liberalizatio n o f technolog y import implemente d i n 1967 . The proposa l designate d 10 2 R&D objective s fo r social an d economi c development , a s wel l a s 1 3 field s o f scienc e al l requiring the government's suppor t durin g the nex t 1 0 years. Also , i t emphasized tha t the government shoul d improv e it s R&D basi s an d the environmen t of nationa l re search institutes/universitie s - suc h a s increase o f the per capita researc h fund , modernization of R&D facilities and equipments, strengthening S&T information activities, etc. Other priorities were to provide tax exemptions for R&D expenditure in the private sector an d to increase the number of scientists and engineers -

290 Masahir

o Kawasaki

Table 4: Chang e of industrial structure (%) Primary Industry

Secondary Industry

Tertiary Industry

1934-1936

19.8

49.4

FY1951

25.0

30.8 32.4

FY1955

22.8

30.8

46.8

FY1956

19.4

33.4

47.6

FY1957

18.8

33.9

47.8

FY1958

18.4

33.2

48.8

FY1970

10.1

38.6

51.3

20.4

30.2

FY1940

49.3 44.1

26.0

29.9

FY1950

48.3

21.9

29.8

FY1955

41.2

23.8

35.0

FY1970

23.7

32.2

44.1

/. Added Value Base 42.7

2. Employment Base FY1930

Source: Okit a (1960:8 )

a wel l a s t o improv e post-graduat e education . A s fo r th e activatio n o f national research institutes , the government approved th e construction plans for Tsukuba Science City in 1963, in order to improve their research facilities and environment. The initial construction plan - tha t 41 national institutes and 2 national universities located i n Tokyo had to move to the Tsukuba district - wa s almost accomplishe d in 1979 . And i n 1966 , just before th e liberalization o f technology import, AIS T of MITI launched a new institution of large-scale industria l technology development project s (MH D powe r generation , a new process o f ethylene production, a desulferization proces s for exhausted ga s from large-scal e electri c powe r plants, a supe r computer system , etc.) . Furthermore, i n 1967 , th e government provide d a ne w tax reduction syste m for R& D expenditures , in order t o strengthen R& D activities in industry. Behind thes e polic y direction s i t mus t b e als o recognize d tha t th e intensive analysis of "technological gaps " among membe r countries conducte d b y OECD (mainly gap s betwee n th e US A an d othe r countries ) durin g th e latte r hal f o f the 1960 s had a strong impact o n th e scienc e an d technology polic y of membe r countries, particularly Japan . Th e result s of OEC D studie s pointe d ou t tha t th e technological gap s wer e cause d mainl y by th e followin g fiv e factors : (i ) R& D capabilities in the respective country ; (ii) whether markets were of sufficient siz e

The Historical Developmen t of Japanese S& T Polic y

291

Table 5: Structura l relation between th e Income Doubling Plan and the first Recommendation of the CS T National Income Doublin g Plan

The first Recommendation o f the CST

(Socio-economic Goals ) 1. t o sustai n economic stabilit y 2. t o achieve continous high growth rate (7.8% a t annual average) 3. t o improve livin g conditions 4. t o realize ful l employmen t

(Goals) to achieve Incom e Doublin g Plan:

(Role of the Government) to provide the base of private sector's activities: 1. t o enhance socia l capita l 2. t o improve huma n ability and develop science an d technolog y 3. t o fulfil l socia l securit y and welfare 4. t o guide private industr y - liberalizatio n of trade and capital - promotio n of trade and international economic cooperatio n - improvemen t of industrial structure and strengthenin g international copetitiveness

(Policy Priority ) 1. t o raise over-all S& T leve l 2. t o recover technologica l ga p between the advanced countrie s and Japan (Major Polic y Approaches ) 1. t o improve quality of and increas e scientists and engineers (during 10 years, shortag e wa s estimated at 170,000) 2. t o improve S&T informatio n system 3. t o promote the transfer of advanced technologies t o small and medium sized industrie s 4. t o promote absorptio n o f new knowledge from the advanced countrie s 5. t o increase tota l national R&D expenditure equivalent to 2% of national incom e

Sources: Economi c Counci l (1960); Council for Science and Technology (1960 )

to justify th e scale o f the industry; (iii) the scale of demands and procuremen t of the respective government ; (iv) the company's scale ; an d (v ) whether o r not th e respective society had social and economic condition s receptive to the acceptanc e of such innovations. From the viewpoint of the OECD analysis, it can be summarized that Japanese economic and S&T policy provided the industry with the appropriate environment for continuous innovations. As regard s th e large-scale sciences, space and ocea n developmen t program s were initiate d during the 1960s . Spac e R&D ha d been conducte d b y Tokyo University sinc e th e lat e 1950s , an d th e succes s o f Sputni k in th e USS R i n 195 7 resulted in the government's ful l initiativ e in the program. I n order t o coordinat e overall spac e R& D activitie s and t o formulat e the nationa l space developmen t policy, the Spac e Activitie s Commission (SAC ) wa s establishe d i n 196 8 o n th e basis of several recommendations of the Space Development Council established in 1960 . Then, i n 1969 , the National Space Development Agency (NASDA) wa s established, i n orde r t o conduc t th e practica l purpose-oriente d project s o f th e

292 Masahir

o Kawasaki

National Spac e Developmen t Program (e.g . meteorologica l satellites , broadcast ing satellites, communicatio n satellites, an d launching systems). The Institut e of Space an d Astronautical Sciences o f Tokyo University conducts scientific activities on space under the guidance of the SAC. This organizationa l settin g has not changed until today. In addition, the government initiated the promotion of ocean science an d technolog y fro m 195 1 on an d participated i n international program s such a s th e Internationa l Survey Progra m o f th e India n Ocea n (1962 ) an d th e International Join t Surve y of th e Kuroshio i n the framewor k of IQSY (1964) . It also conducte d a survey of abnormal cold masse s occurrin g in Japanese waters . In 1968 , th e ST A began t o operat e a deep-se a explorator y vessel, th e Shinkai 2000. All in all, the basis of today's ocean development activities was built by the establishment of the Council for Ocean Developmen t and Japan Marine Scienc e & Technology Cente r (JAMSTEC) i n 1971 . On th e othe r hand , wit h respec t t o th e pendin g question of overal l coordina tion o f scienc e an d technolog y polic y also involvin g universit y researc h policy , significant debate s aros e amon g th e Diet , th e governmen t and academia . A s i s described, th e first CST recommendation in 1960 pointed out that the government should provid e a new lega l framewor k for scienc e an d technology , not onl y for its promotio n bu t als o t o strengthe n coordinatio n o f overal l governmenta l S&T activities, includin g those fro m th e university . Then, i n 1962 , th e CST propose d the concept o f the Basic Law for Science an d Technology. A t the same time , the ad ho c Committee fo r Science an d Technology o f the House o f Representatives presented a draf t o f th e Basi c La w fo r Promotio n o f Scienc e an d Technology . And th e JSC recommende d t o the government th e framework of the Basi c La w for Scientifi c Research . Taking into account these proposal s an d discussions, the CST recommende d i n 196 5 th e framewor k o f th e Basi c La w fo r Scienc e an d Technology. Base d o n CS T recommendation , th e governmen t submitted to th e Diet the Draft of the Basic Law Science and Technology, in February 1968 , which was rejected i n December o f that year. Briefl y speaking , the mai n reason fo r this rejection cam e fro m th e objection tha t universities' activities should fall outsid e science and technology policy. This problem has cast a shadow over the integrity of science and technology policy even until today; S&T policy priority determines basic research, bu t universities are still expected t o play a major role in such basic research. Also , these discussions infer today's Japanese bureaucratic rivalry. Each ministry tends to conduct science an d technology policy with attempts to expand its jurisdiction int o the emerging area s of S&T .

The Historical Developmen t o f Japanese S& T Policy 29

3

4 Priorit y Shif t o f S&T Policy fro m Economic Growt h to Social Welfar e (1970-1980) This period wa s a time when a series o f significant change s occurre d i n domestic and internationa l society. I n industr y as well , there emerge d ne w ke y technolo gies - suc h a s 1C , LSI , computer , recombinan t o f DNA , etc . Naturally , there appeared ne w types o f problems whic h required a priority shift o f Japan's S& T policy. First , followin g the rapid growt h of th e Japanese econom y i n the 1960s , air and water pollution revealed themselve s i n the industrialize d zones o f Japan . These environmenta l pollution problems wer e perceive d a s a shado w o n eco nomic prosperity and provoked publi c antipathy to economic growt h policy in the beginning of the 1970s . In response, th e government provided a n intensive legal framework, suc h as the Basic La w for the Prevention of Environmental Pollution in 1967 , the Law for the Prevention of Air Pollution and the Law for Anti-Noise in 1968, the Law for the Prevention of Water Pollution in 1970 and the Establishment Law of the Environmenta l Agency i n 1971 . Second, with regard t o international environment, it can be said that Japanese remarkabl e economic growt h depende d both on the fixed foreign exchange rate of the Yen (1 U$=360 yen ) and on a stable supply of petroleum. In the beginning of the 1970s , however , these tw o element s became unstable: namely, in 1971, the United State adopted th e floating exchange rate (the yen-US$ rate changed to 1US$= 30 8 yen); and in 1973 , the first oil crisis occurred. Japa n suffere d fro m high inflation an d a subsequent stagnation of eco nomic activities , particularly in fallin g investments . These change s i n domesti c and internationa l environments had a stron g impac t no t onl y on economi c an d industrial policy, but also on science an d technology policy. In addition , during the pas t fe w decades , man y industria l goods ha d widel y diffused t o the public - suc h a s home-electrical an d -electronic appliance s and cars, etc. Reflectin g on material sufficiency , th e center o f national consciousness or the public attitude towards scienc e and technology wer e bot h gradually shift ing toward those issue s improving the quality of life (se e Figure s 4 and 5). Ther e appeared a stron g indicatio n which suggeste d tha t th e pas t rol e an d futur e ex pectation o f science and technology neede d t o be reexamined. Typical examples included anti-environmenta l pollution movement, th e anti-nuclea r power plan t movement an d monitorin g food safety . A ho t politica l issu e wa s no t onl y ho w environmental pollution can b e overcome, bu t also ho w scienc e an d technology should b e furthe r develope d i n harmonization both wit h the individua l an d with society. Reflecting upo n thes e changes , th e priorit y o f nationa l polic y shifte d fro m industry- an d growth-oriente d t o social-oriente d ones , a s typifie d b y th e title s of th e Ne w Economi c an d Socia l Developmen t Pla n adopte d i n 197 0 an d th e Basic Pla n fo r Economy an d Societ y adopte d i n 1973 . Both plan s proposed that the government should take steps toward s th e improvement of the general living

Masahiro Kawasaki

294

/-Electric washing machines

1950

._ Passenge r car s Black-and-white TVs -•-"''.'Ν--Electric refrigerator s ' o f 200 liters or more Stereo receiver s ' Room airconditioners (room coolers ) ' Electroni c ranges -Multivoice color TVs . Full y automatic electric / washin g machines /~~-Video tap e recorder s

1980

1985

Figure 4: Growt h of major home electrical appliance s Note: Growt h before 196 3 was for non-farming households in cities with populations over 50,000. The rat e after 196 4 was for all households. Source: Economi c Plannin g Agency (1985:125)

conditions o f Japanes e society , well-balance d wit h he r economi c potential , a s well as the promotion o f international cooperation. I n other words, improvement of quality of lif e instea d o f economic growt h alone, became the priority issue of the nationa l policy. Particularly urgen t policy objective s include d environmental protection, energ y security , and the development of social infrastructur e t o solve urbanization problems . In this context, the CST presente d t o the Prime Ministe r in 197 1 th e 5t h Recommendatio n o n th e Overal l Policy Framewor k fo r Scienc e and Technology i n the 1970s . Successively , th e CST proposed the Fundamental Approaches o f Overal l Scienc e an d Technolog y Polic y i n 197 7 (th e CS T 6t h Recommendation). Highlights of both recommendations ar e summarized a s follows: 5th Recommendation : Goals: - t o respon d t o socia l need s (qualit y of life , improvemen t of infrastructure, environment, international cooperation, etc. )

The Historical Developmen t of Japanese S& T Policy 29

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Figure 5: Change s i n values among the Japanese population Source: Commissio n on the History of Science an d Technology Policy (1991:117)

Approaches: - continuou s efforts t o pursue the lines of the 1 st recommendation - tota l R&D expenditures to exceed 2.5 % of National Income Priority R&D area: - S& T for environment protection Issues: - technolog y assessmen t - basi c science s for future ne w technology (lif e sciences ) - sof t science s 6th Recommendation: Goals: - t o overcome socio-economi c difficultie s an d to build up a strong national base (mainly, energy resources ) Approaches: - follow-u p efforts o f the lines of the 5th recommendation - tota l R&D expenditures to exceed 3 % of National Incom e Priority R&D area: - S& T to solve resource problem s Issues: - S& T for improvement of living conditions - S& T for health - advance d and basic S&T

296

Masahiro Kawasak i

- S& T for competition and international cooperatio n The recommendation s clearl y focuse d o n th e socio-economi c problem s o f tha t time. Highes t priorit y i n S& T polic y wa s particularl y give n t o th e promotio n of scienc e an d technolog y t o preven t environmenta l pollution , t o sav e energ y and t o develo p alternat e energ y sources . I n th e environmenta l fields , publi c research organization s (includin g prefectural leve l ones) playe d a n important role in monitoring pollution and in developing technologies t o reduce pollutant s from processing an d factories. I n industry - particularl y iron and steel, meta l refining , electric powe r generation , automobile and chemicals - hig h priority was given to the prevention of environmental pollution (see Figure 6). Taking an example fro m the automobil e industry , the America n anti-pollutio n regulation o f 197 0 urge d firms to develop environment-friendly type s of automobile engines . 1500 1200

300 0 Year 70 7 1 7 2 7 3 7 4 7 5 7 6 7 7 7 8 7 9 Amount 159 32 7 54 3 84 9 94 5 1.0811.07 7 81 4 1.3581.427

Figure 6 : Tren d o f R&D expenditur e for prevention of pollution (in 10 0 million yen) Source: Commissio n o n the History o f Science and Technology Policy (1991:130 )

In the fields o f energy S&T , th e government playe d a n important role to over come the energy crisi s - i n particular, b y developing alternativ e energ y source s on th e basi s o f th e CS T recommendatio n o f 1971 . I n 1974 , fo r th e promotio n of nuclea r power generation, th e governmen t provide d ne w legislatio n wit h the aim o f solvin g th e locatio n problem s o f nuclea r power plants . Unde r th e ne w legal framework, the government can give subsidies to the local governments (responsible fo r locating electri c powe r generatio n plants ) for any plans to improve infrastructure. Likewise , nuclear energy development was accelerated throughout the fiel d b y th e government , wit h the improvemen t o f nuclea r safet y i n LWRs ,

The Historical Developmen t of Japanese S& T Policy 29

7

development of fast breeder reactors and fuel cycle technology, management technology fo r radioactive waste, nuclear thermal fusion , etc . I n other energy fields, the AIST of MITI started i n 197 4 Sunshine Projects withi n the framework of the Large-Scale Industria l Technolog y Developmen t Programs , i n order t o develo p alternative energy sources. Projects included gasification and liquidificatio n pro cess for coal, geothermal utilization, solar heat utilization and solar-electric cells, etc. I n addition , the AIS T i n 197 8 starte d Moonligh t Projects withi n th e sam e programs, i n order t o improve the development of energy-saving technologies in energy suppl y and transportatio n sectors , a s wel l as i n processing. I n 1978 , th e STA also started projects concernin g utilization of ocean and wind energy. With regard t o automobiles , the MIT I an d th e Ministr y of Transportatio n initiate d a project aiming at the reduction of fuel cost . In addition , th e CS T suggeste d th e followin g priority list s fo r scienc e an d technology: - sof t science s (studie s o n relation s betwee n technolog y an d society , polic y research, etc.) ; - lif e science s (geneti c engineering, molecular biology, etc.); and - basi c research targetin g for new technologies (electronics, new material, etc.). Considering th e rapi d developmen t o f electroni c technolog y an d th e tendenc y for it s diffusio n i n various sectors o f industry , the MIT I integrate d two existing laws, i.e. the Law fo r the Promotion of the Electronics Industry an d th e Law fo r the Promotio n of th e Machin e Industry, into a singl e law i n 1971 . Th e purpos e of thi s wa s t o fus e electronic s technologie s wit h th e machiner y area. Also , th e AIST of the MITI supported a series of R&D programs for electronics; namely, a cooperative compute r R&D program by six computer makers from 197 2 to 1976 , a supe r LS I developmen t progra m fro m 197 6 t o 1979 , an d a n R& D progra m of basi c compute r technolog y fro m 197 9 t o 198 3 unde r the Ac t o f Industrial Research Association. The ST A promoted lif e science s R&D projects i n RIKEN from 197 2 to 1981 . Although governmen t policy greatly stimulated industry's R&D, i t should be noted tha t any reall y intensive R&D effort s on the par t of industry to overcom e difficulties, resulte d from th e oil crisis of 197 3 and 1979 . In order t o reduce pro duction cost, industries made particularly enormous efforts t o develop recycling technology for waste heat and energy-saving technology for raw material and resources, as well as the introduction of factory automation and robotics for saving labor. Based o n those technologica l backlogs , Japanes e industr y attaine d a n advanced leve l of industrial technology. Throughout the period , Japanes e industry transformed it s industria l structur e from energy-intensive t o high-technologyoriented. I n othe r words , th e information-technology-oriented structur e too k shape a s earl y a s th e 1970 s (Odagiri/Goto ; fo r furthe r informatio n on thi s an d the following period, see the White Papers on Science an d Technology, published

298 Masahir

o Kawasaki

by the Science an d Technology Agency in 1980, 1989 , 199 0 [full tex t in Japanese only]).

5 S& T Policy Built into Globalization (afte r 1981 ) All i n all, Japanese industr y was able by the beginning of the 1980 s to overcom e the oil crisis, the rapid rise in the value of the yen and the subsequent worldwide economic recession . A s a result, Japanese industr y is assumed t o have obtained a relativel y dominan t position i n th e worl d econom y an d presentl y expand s its activities outside Japan, whil e most advanced countries suffered fro m long-ter m recession an d 'stag-flation' . Fo r example, Japan's GN P exceede d 10 % of world GNP i n 1980 ; an d i n 198 8 it reached 14% . Also, Japan's trade balanc e recorde d a surplus o f 19. 6 billio n US$ i n October 197 7 an d 101. 4 billion dollars in 1986 . This trade imbalance - and thus, the strong competitiveness of Japanese industry resulted in the trade frictions between Japan and the other advance d countries as early as the late 1960s . These frictions brought about the following arrangement: - th e textile trade agreement betwee n the USA and Japan in force since 1962 ; - th e export control of iron and steel to the USA since 1966 and to EC countries since 1972 ; - th e export control of TVs to the USA since 1968 ; - th e export control of machine tools to the USA since 1986 and the export price control to the EC since 1981 ; - th e export control of cars to the USA since 1981; - th e export control of VTRs to Australia since 198 1 and to France since 1982 ; - th e semiconductor agreemen t betwee n th e USA and Japan, an d between the EC and Japan, since 1986 ; - MOS S (Market-Oriente d Sector-Selective ) bega n i n 198 5 betwee n th e USA and Japan (for telecommunications, pharmaceuticals, medical equipment, electronics, an d fores t product s a t th e beginning ; and i n 1986 , computer s wer e added; and - SI I (Structural Impediments Initiative) between the USA and Japan since 1989 . Recently, trad e friction s have appeare d i n th e categorie s o f high-tec h product s assumed t o be strategi c to both economi c growt h an d security. In addition, both the expansio n o f worl d trad e an d th e activitie s o f multinationa l corporations tend t o promot e th e globalizatio n of Japan's economy . Inevitably , such friction problems become so complex that they involve the nation's structural and cultural issues, includin g Japanese marke t practice s an d genera l domesti c socia l polic y issues. I n particular, since the beginning of the 1980s , Japan has faced structural adjustment issues. In response to these problems, Maekawa 's Report (the report of a working group on structural adjustment, an unofficial advisory board to the Prime

The Historica l Development o f Japanese S& T Polic y 29

9

Minister) proposed i n 198 6 a ne w polic y direction fo r th e expansio n o f Japan' s imports and direct foreign investment. In 1987, the Report of the Adhoc Committee of th e Council o f Economy (th e ne w Maekawa' s Report ) followe d u p alon g th e same lines of the 198 6 report and recommended tha t Japan promote foreign direct investments in the manufacturing industry, in order to expand Japan's import share of industria l product s an d als o t o contribut e t o th e developmen t o f production capacities an d to enhance employment opportunities in other countries. I n 1989 , negotiations o n structura l adjustment issues, includin g industrial restructuring, were conducted between Japan and the USA. Amid th e favorabl e performanc e o f Japanes e industr y in th e worl d market , the structural friction issu e has become on e of the hottest. No t surprisingly, there appeared to critics that Japanese industrial success was based on the good coupling of governmen t intervention with industry' s indigenous efforts. Japan i s accuse d of bein g a "free-rider " o f basi c researc h whic h othe r advance d countrie s hav e contributed. In coping with newly-emerging international and domestic problems, S&T polic y priorit y ha d t o shif t t o th e promotio n o f basi c research , whic h i s deemed t o be o f common interes t to international society. For instance , in 1981 , the STA established the following new systems to promote basi c research : - Specia l Coordination Funds allocated to basic research ; - program s of governmental laboratories unde r the CST's guidance; and - Explorator y Research fo r Advanced Technolog y (ERATO ) from the JRDC (a system t o conduct research challengin g open-ended theme s under the leader ship of an innovative and scientificall y ke y individual whom the JRDC select s as leader) . The Ministr y of Education expanded the amount of its grants to university R& D and t o post-Doctora l fellowship s in 1981 . Likewise , th e AIS T o f MIT I starte d R&D Projects on Basic Technologies for Future Industries in 1981 , which intends to suppor t basic researc h aimin g a t th e exploratio n of ke y technolog y need s o f future industry . In 1984 , the CST proposed a new framework of science and technology policy focusing on (i) the promotion of basic research for creative science and technology, (ii) harmonization of S& T wit h peopl e an d societ y an d (iii ) internationalizatio n of S&T activitie s in Japan (the 11t h Recommendation o f the CST). Throug h th e recommendation, the traditional industry-oriented approach wa s cancelled. High priority was given to basic research i n the fields of communications and electronics, materia l scienc e an d technology , lif e sciences , sof t sciences , spac e scienc e and technology, oceanography an d earth sciences. I t also recommended tha t government promote internationa l cooperation a s well as the internationalizatio n of science and technology activities. Along these lines, the government took a series of actions, as follows:

300 Masahir

o Kawasaki

- th e budget fo r basic researc h increase d i n the ministries an d agencies con cerned; - RIKE N established its Intentional Frontier Research Syste m in 1986; - th e government provide d i n 198 6 a new legal framework , the Act for Facilitating Researc h Exchange , in order t o promote researc h cooperatio n amon g universities, governmental laboratories and industry - a s well as international R&D cooperatio n of national laboratories; - STA fellowships for foreign researchers starte d in 1988; - th e Human Frontier Science Program (international cooperation program) was initiated by ST A and MITI in 1989 ; and - Japa n participated in the Space Station Program in 1984 (with the cooperation agreement settle d in 1988) . All thes e ne w system s reflec t th e shif t o f priorit y i n scienc e an d technolog y policy; an d th e budget s increas e yea r b y year . However , th e tota l governmen t budget fo r th e promotio n o f scienc e an d technolog y ha s rathe r stagnate d fro m 1980, since the government has kept the no-increase budget policy becaus e of the large defici t (mor e the n a hundred trillion yen) . As a result, universities and th e governmental laboratorie s suffere d fro m a shortage o f R&D-running funds. Th e R&D environment, including the quality of equipment and facilities, has not been reasonably improved (see Tabl e 6). Table 6 : Tren d o f the budget for science an d technology in Japan (in 10 0 million yen) Total Amount Universitie FY1980

1,294,893

-

FY1985

1,532,869

FY1986

s (% ) Nationa

l Labs. (% )

-

534,251

(-) (35)

1,606,386

563,039

(35)

234,655

(-) (14) (15)

FY1987

1,662,336

594,243

(36)

245,929

(15)

FY1988

1,715,745

621,781

(36)

256,189

(15)

FY1989

1,815,196

657,517

(36)

275,452

(15)

FY1990

1,919,603

689,721

(36)

292,719

(15)

221,391

Source: Scienc e an d Technology Agency (1991:113-118)

The R& D expenditur e share o f the government decreases yearly. In contrast , Japanese industry has been expanding its overall R&D activities, including basic research, sinc e the 1980 s (see Table 1) . As Figure 2 has shown with regard t o the trend i n th e numbe r of corporat e laboratorie s established , the 1980 s hav e been the second boo m (after the 1960s). Most of the newly-established laboratories are targeted towards basic research. Roughly speaking, the major Japanese companie s

The Historical Development of Japanese S& T Policy 30

1

spend 10 % of thei r tota l sale s fo r R&D ; an d th e expenditur e fo r basi c researc h amounts to 1 % of their total R&D expenditures .

6 Conclusion s Through thi s historica l revie w o f Japanes e S& T policy , th e followin g ca n b e viewed a s tentative conclusions. (1) Japan's S& T polic y followin g World Wa r II wa s successfu l i n ligh t of th e country's quick restoration an d subsequent industrial and socio-economic devel opment. Th e S& T policy responde d adequatel y t o the industria l needs resultin g from changin g domesti c an d internationa l situations . S& T policy-makin g wa s well incorporated int o both industria l and economic policy . (2) Through a process of success, an d despite a gradual change in S&T policy goals, th e institutional framework of S&T policy - particularl y its administrative structure - ha s no t changed sinc e th e establishmen t o f the CST in 1959 . Th e institutional continuity has several advantage s that ensure incremental changes of S&T polic y (no t radica l ones ) an d thu s enabled Japa n t o kee p long-ter m R& D programs stable , eve n i f fund s d o no t remarkabl y increas e (e.g . energ y R& D programs). O n the other hand , it is claimed tha t some disadvantage s appea r wit h regard t o the funding o f newly-emerging S&T activities (e.g. a budget allocation system). (3) At present, industr y plays a major role i n the branching-out of innovations. S&T policy should provide the appropriate environments for possible innovations. Taking int o accoun t th e rul e o f marke t mechanisms , governmen t intervention should b e carefull y conditioned . O n th e othe r hand , basi c researc h i s mainl y conducted i n universities and governmenta l R& D organizations , an d th e results are opened t o the international academic community . Basic researc h als o creates new scientifi c knowledge whic h stimulat e innovation . Thus, th e governmen t i s expected t o promote basi c research. Recently , Japan's S& T policy has given high priority t o basi c research . Thi s targe t shif t shoul d b e stresse d i n ligh t o f th e declining R&D environment , at universities and national laboratories . (4) Today, Japan is facing a phase of radical changes. The priority of S&T policy should shif t t o th e internationa l contribution ; an d R&D , oriente d t o scientifi c knowledge. Fro m thi s point o f view , it is a challenging questio n t o as k how th e existing institutional framework of Japan can remain effective regarding new S&T policy.

302 Masahir

o Kawasaki

Acknowledgments I would like to expres s my sincer e appreciation to Dr . Y. Baba for hi s excellent suggestions and advice. References Commission o n th e Histor y o f Scienc e an d Technolog y (ed. ) (1991 ) Historical Review of Japanese Science an d Technology Policy, Tokyo : Nationa l Institut e o f Scienc e an d Technology Policy . Council for Science an d Technology (1960 ) Juunengo wo Mokuhyou tosuru KagakugijutuSinnkou n o Songuteki Kiho-Housaku nitsuite (Th e Firs t Recommendatio n - Compre hensive Poli y Guidelin e for Promotio n o f Scienc e an d Technolog y 1 0 Years hence) , Tokyo: Science and Technology Agency. Economic Counci l (1960 ) Kokuminshotoku Baizou-Keikaku (Nationa l Income Doubling Plan), Tokyo: Economic Planning Agency. Economic Planning Agency (1956) Keizai-Hakusho (Whit e Paper on Economy, Fiscal Year 1956), Tokyo: Economi c Planning Agency. Economic Plannin g Agency (1985) Kokumin-Seikatsu Hakusho (Whit e Paper on National Living), Tokyo: Economic Planning Agency. Kodama, F. (1991) Haiteku-Gijutu n o Paradigms, Tokyo : Chuuokoronsha. Odagiri, H., A. Goto (1990 ) National Systems Supporting Technical Advance in Industry in Japan, unpublished manuscript, Tokyo. Okita, S. (1960) Shotoku-Baizoukeikaku no Kaisetsu (Explanation Note of National Income Doubling Plan), Tokyo: Nippo n Keizai Shinbunsha. Science an d Technolog y Administratio n Council (1951 ) Kagakugi jutu Nenpo i n 1951, Tokyo: The Secretariat o f the Council. Science an d Technolog y Agenc y (1991 ) Indicators o f Science an d Technology, Tokyo : Science an d Technology Agency . Statistics Burea u o f th e Prim e Minister' s Offic e (1953 ; 1954 ; 1955 ; 1956 ) Kenkyukikan Kihontokei Chosa (Statistic s on Research an d Organizations), Tokyo: Statistic s Bureau of the Prime Minister's Office . Statistics Bureau/Agenc y o f Administrativ e Managemen t (1961 ; 1976 ; 1984 ; 1990 ) Kagakugijutu-Kenkyu Chos a (Statistica l Surve y o n R&D) , Tokyo : Statistic s Bu reau/Agency o f Administrative Management .

National System s o f Innovation an d Technolog y Policy: The Case of Denmar k Bent Dalum

1 Introductio n During the accelerating internationalizatio n in the 1980s , intensified i n Europe by the establishment of the Single Market, technological change has been emphasize d more than before as a major factor in economic growth . Technology polic y has in many countrie s conquered a more prominen t role o n the policy agenda vis-a-vis standard macroeconomic polic y prescriptions. The spectacula r success o f Japanese economi c performanc e wa s focused on in Europe an d th e Unite d States an d le d t o th e proliferatio n of technolog y polic y programmes i n larg e a s wel l a s i n smal l countries . "High-tech " programme s became the fashion. In many countries, these efforts were founded on fairly similar concepts; they were often 'imitated ' i n a cross-national sort of way. Programme s supporting informatio n technology wer e give n especiall y hig h priorit y a t th e political level , ofte n i n lin e wit h th e ESPRI T programm e whe n involvin g EC countries. However, a more differentiated approach is apparently necessary. More fundin g for researc h i n new "core technologies " - suc h a s information technology and biotechnology - i s not a sufficient , thoug h probabl y a necessar y conditio n for better long-ter m economi c performance . When conceive d oversimplisticall y as a magic formula , a blind "Science & Technology Push " strategy doe s not contain any guarantee for successful economic performance. Is so-called socially-oriented technology policy an alternative, and what may be the content of such a concept ? The presen t chapte r will tr y to sketch out a framework for that discussion. It mus t b e emphasize d tha t recen t development s i n th e orientatio n o f Danish technology policy do not fit well into what one probably would expect to be th e framework o f a "socially-oriented " technolog y policy . The mos t salien t feature has thus been drasti c cut s in budget appropriation s for industria l an d technolog y policy measure s i n fiscal year 199 0 an d onwards . To preven t misunderstandings , Danish industria l and technolog y polic y ha s been fairl y liberalisti c in th e postwa r period . Thi s i s sometime s a surpris e t o foreign analysts , wh o woul d expec t t o fin d a mor e 'dirigiste ' approac h i n a Scandinavian welfar e state. However , a s stresse d a fe w year s ag o i n the OECD

304 Ben

t Dalum

review of Danish science an d technology policy , the government initiated "a wide range o f initiatives aimed a t substantiall y strengthening science an d technolog y policy" during the mid-1980 s (OEC D 1988:11) . These new policy signal s wer e to a certain extent brought to an end in December 1989 , when cuts were approved by the government - publishe d as a sort of barter for a decrease of 1 0 percentag e points in corporate tax rates. 1 The chapte r take s it s poin t o f departur e partl y i n discussion s raise d b y tha t change and , mor e generally , i n th e concep t o f Nationa l Systems o f Innovation (NSI).2 Section 2 contains a brief summar y of the most salient features of Danish technology polic y i n th e 1980s . I n Sectio n 3 , som e importan t feature s o f th e international specializatio n pattern s o f smal l high-incom e OECD countrie s ar e discussed, followe d by the fundamental question of whether it is at all relevant to focus on the national arena in Section 4. Finally, Section 5 contains the discussion of the concept o f "socially-oriented" technology polic y in a Danish context .

2 Recen t Development s i n Danish Technology Polic y i n Brief From the beginning of the 1990s , Danish technology policy at first glance appears to have returned to its traditionally liberalistic flavour- although in a new disguise. However, the general policy approach i s at the moment very much open to debate. Thus, future trend s are difficult t o predict. Technology (and, more broadly, industrial) policy was not a central policy issue in Denmark during the 1960 s and 1970s , althoug h governments were dominate d by coalitions heade d by the Social Democrats . Th e policy was more an outcom e of a lack o f explicitly formulated goals rathe r than a result of conscious political decision-making. According to the OECD review (1988:23), Little specific legislation covers research an d technology policy. To a large extent the policy is reflected i n th e siz e an d relativ e weighting of th e budge t appropriations . Th e polic y is also determine d b y th e wa y i n whic h thes e appropriation s ar e actuall y allocated b y th e competent authorities , which thereby decide the main course to be followed in encouraging R&D an d technology i n both th e public and the private sectors.

In practica l terms , thes e authoritie s hav e acte d unde r th e guidanc e o f commit tees, dominate d b y representative s fro m industr y an d trad e associations . I n th e early t o mid-1980s, this non-policy-like approach wa s somewhat changed. 3 Th e persistence o f Danis h balanc e o f payment s problem s (permanen t defici t i n th e quarter of a century from 196 4 to 1989) did raise discussions of whether the cause could be exclusively formulated in terms of standard macroeconomic variable s such a s (excessively high ) increases i n wage costs , governmen t expenditure an d private consumption. During the early t o mid-1980s, more emphasis wa s put on "structural" variables , such as the composition of production and exports and their

National System s of Innovation and Technology Policy : Th e Case of Denmark 30

5

determinants, as a result of which R&D and technological innovatio n began to be taken more seriously. Technology polic y wa s change d b y th e introductio n o f severa l majo r pro grammes. Th e IT-oriente d Technologica l Developmen t Programm e (TUP ) o f 1984 wa s b y fa r th e larges t effor t (fo r a brie f summary , se e OEC D 1988:59 61). Other programme s wer e als o initiated , of which a biotechnological researc h and developmen t programm e fro m 198 7 wa s probably th e mos t significan t (see Arnfred e t al. 1989) . However , a s pointed ou t by Christiansen (1989) , the policy change wa s to a certain exten t more programmati c than real . As fa r as the TU P programme wa s concerned, a significan t part o f th e fund s were integrate d int o already existin g policy instruments . The ver y broa d ai m o f the programme , i.e . more rapid diffusion o f IT to all sectors of Danish industry and services, combined with administrative integration into existing schemes, resulte d in continuity rather than any radical break . In spite of that and several other , in our view, reasonably positiv e effects of the programme4, it was closed befor e schedul e at the end of 198 8 - a s a prelude to the "Great Cut" i n the 199 0 budget illustrated in Table 1 . However, th e latter ha s raised fairl y extensiv e discussions of the content and aims of national technology policy strategie s an d efforts. The Dalu m e t al. (199la) report, commissione d b y the National Agency of Industry and Trade (NAIT) as a foundation for discussions of futur e approache s t o industrial an d technolog y policy i n the new Industr y and Trade Developmen t Counci l (ITDC) , ha s bee n par t o f thi s general debate . Th e approach ofthat report will be interpreted below as a contribution to the discussion of a framework for a "socially-oriented" technolog y policy.

3 Internationa l Specializatio n o f Small OEC D Countries One o f the mos t intriguin g questions in much of the presen t internationa l debate on technolog y polic y i s whethe r nationa l policie s hav e an y futur e relevanc e a t all i n a "borderless world" (se e e.g . Ohma e 1990) , especiall y see n fro m a smallcountry point of view. As a background for that discussion, some salien t features of international specialization wil l be presented . In their effort t o develop the causal chain from technical change to international trade and basing their reasoning on extensive empirical studies , Dosi et al. (1990) emphasize tha t internationa l differences in technological capabilitie s ar e fundamental i n explainin g cross-nationa l difference s i n level s an d trend s i n exports , imports an d incom e pe r capit a (se e e.g . th e 'stylize d facts ' o f their Chapte r 3) . They also demonstrate that the level and change of market shares among the major OECD countrie s apparently can be explained by country-specific absolute advantages o r disadvantages - leadin g to favourable or unfavourable foreign incom e elasticities vis-a-vis a given country's exports.

306 Ben

t Dalu m

Table 1 : Researc h fund s i n Denmark, 1988-199 3 (198 8 = 100 )

1988 198

9 199

0 199

1 199

2 199

3

Department o f Industry

100

72

57

56

46

34

Department o f Agriculture

100

113

117

119

101

103

Department of Energy

100

99

96

95

94

93

Department of Environment

100

109

110

101

103

82

Department o f Education

100

103

102

99

99

98

Index

100

97

94

92

88

88

Source: Dalu m et al. (199la), adapted fro m Ministr y of Education (1990 ) Regeringen s Stategiske Forsknings- og udviklingsprogram, Copenhagen : Ministr y o f Edu cation

In thei r approach , convergin g a s wel l a s divergin g mechanism s coincid e i n shaping country and industr y patterns. This dichotomy consists of development of the main technologies on the one hand, which vary across countries and acros s firms, and "strategies , contex t conditions an d history " o n th e othe r (Dos i e t al . 1990:89). The latter factors vary , however, not only among companies an d countries bu t als o acros s technologies . Th e technolog y factor , i n ver y crud e terms , nevertheless represent s tw o dimensions : innovation , whether o f product o r pro cess technology, lead s to divergence; an d diffusion lead s to convergence amon g firms and countries. Th e nationa l context ha s a role to play in the determination of long-term growth patterns, especially because o f the inherent cumulative and path-dependent feature s o f technology : "Onc e th e cumulativ e and firm-specific nature of technology is recognized, it s development over time ceases to be random, but i s likely to be constrained to zones tha t are closely relate d technologicall y to existing activities . I f thos e zone s ca n b e identified , measure d an d explained , it is possible i n principle to predict likel y futur e pattern s of innovativ e activities in firms and countries" (Dos i et al. 1990:85) . Based on extensive empirical studies , using among others internationally comparable paten t data 5, Dos i et . a l (1990:102 ) summariz e fou r characteristic s o f technological specialization : - smal l countries are more specialize d tha n larg e countries; - ther e is a striking stability in each country' s specialization pattern over time ; - specializatio n patterns are distinctly different fro m countr y to country; and - relativel y few large firms exert a significant influenc e on country patterns .

National System s o f Innovation and Technology Policy : Th e Case of Denmar k

307

The firs t thre e o f thes e feature s ca n als o b e foun d i n th e export s specialization patterns o f th e OEC D countries. 6 Figure s 1 and 2 sho w th e Danis h export spe cialization patter n 1961-198 7 according t o two different aggregation s (shown in the Appendix). Specialization is measured by the Revealed Comparativ e Advantage inde x (RCA), showing the export structur e for one countr y compared with the structure of total OECD exports . Th e RCA index shows, e.g. Danis h export s of "resource-base d products " a s a shar e o f tota l Danis h export s divide d by th e same fractio n for th e OEC D a s a whole. I f th e inde x is above 1 , th e countr y is 'specialized' i n that group of products, an d vice versa. Th e weighted index is by definition 1. 0 for the country total.

1965 196

9 197

3 197

9 198

3 198

4 198

7

Figure 1 : Expor t specializatio n i n Denmark, 1961-198 7 Source: IK E trade databas e

The importanc e o f thes e pattern s fo r nationa l economic performanc e ca n b e discussed i n terms o f th e idea s behin d the concep t o f Nationa l Systems o f In novation (Anderse n 1992) . Existing patterns of specialization of production and exports an d linkages between domestic industries are conceived to be important for interactiv e learning processes. A significan t par t o f technica l innovatio n is, according to this approach, the result of incremental processes, highl y determined by existing production patterns. The transmission mechanism between the export specialization pattern , on the one hand, and long-term economic performance on the other, is the foreign income elasticity of demand of the country's exports. I f a given country at the outset i s specialized i n products wit h high present or futur e growth rates in world trade, it then has an advantage compared to other countries and vice versa. Thus, specialization in high-growth products may be taken as an indirect proxy of foreign income elasticities of demand.

308 1.5 1.4 1.3 1.2 1.1 1 0.9 0.8 0.7 0.6 0.5 0.4 0.3 0.2 0.1 0 1961

Bent Dalum

Low-tech

High-tech

1965 196

9 197

3 197

9 198

3 198

_L

4

1987

Figure 2: Expor t specialization i n Denmark, 1961-198 7 Source: IK E trade database

The genera l patter n of most smal l high-income OEC D countries is similar to the Danis h one , havin g been fairl y stabl e ove r a time horizo n o f a quarter o f a century.7 Th e "standard " smal l countr y feature s are specializatio n i n resource based product s and what have been calle d "traditiona l industries" . O n the othe r hand, the "standard" smal l country is not specialized in chemicals or engineering. In term s o f th e aggregatio n o f technolog y intensity , th e typica l small-countr y pattern is characterized b y specialization in "low-tech" products and the opposit e concerning "high- " an d "medium-tech " counterparts. 8 A t th e othe r en d o f th e sample, specializatio n i n high-tec h product s i s a commo n featur e o f th e thre e most powerfu l larg e OEC D economies - USA , Japan an d Germany. In terms of the secto r aggregates i n Figure 1 , the onl y commo n featur e i s specialization i n engineering. Various countr y studie s focusin g o n th e importanc e o f technica l innovations for economic performanc e have isolated a group of countries - th e United States , Japan, Germany an d the two small countries Switzerland and Sweden. Al l thes e show significantly highe r innovative performance than the other OECD countries when measured i n relative terms (per capita, share of GDP, etc.) (see Patel/Pavit t 1987, 1989 ; Dos i e t al. 1990 ; Fagerber g 1988b) . In general, these countries have also been the most successful in terms of long-term economic performance , except in th e case of th e U S balance o f payments problems i n the 1980 s and the mor e recent Swedis h economi c problems . I t i s a commo n featur e o f thes e member s of th e "firs t division " o f OEC D countrie s tha t the y hav e bee n specialize d i n engineering, a t leas t sinc e mid - to lat e 1960s . However , specializatio n i n hightech product s is not a common denominator; Sweden has not been specialized in high-tech products during this quarter of a century. Export specialization in high-

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309

tech product s i s no t i n itsel f a sufficientl y reliabl e prox y fo r a stron g National System o f Innovation , as indicate d below b y th e Iris h case . Specializatio n i n engineering appears , o n th e othe r hand , t o poin t i n th e sam e directio n a s th e analyses of "high innovativ e performance" referred to above. 9 The specialization pattern for most OECD countrie s has been surprisingly stable over the mos t recent quarte r of a century (when neglecting the effect s o f oil and gas). The outstanding exceptions have been Japan and Ireland; both cases are unique and highly different . On e lesso n t o be learned i s that the cumulative and path-dependent character of technological change at the micro level is highly visible in the macro patterns. Fundamental restructuring of these patterns represent s an enormous task for society at large and appears the be the exception rather than the rule. History thu s show s tha t ther e i s n o 'easy fix ' fo r a smal l OEC D countr y to become a "high-tech" economy - excep t in the case of Ireland as shown in Figure 3 and 4. However, specialization i n exports o f research intensiv e goods i s by no means a 'safe ' prox y for an indigenous national system of innovation. The lion's share o f Irish high-tech exports ha s its origin in chemical plants and electronics assembly locate d b y foreig n multinationa l enterprises (MNEs) , which functio n more like export enclaves than an integrated part of the Irish system of innovation.

1965 196

9 197

3 197

9

1983 198

4 198 7

Figure 3: Expor t specialization in Ireland, 1961-198 7 Source: IK E trade databas e

On the contrary, it appears necessary to take the point of departure in unique accumulated skills and experiences of the country - i.e . in the structure of production and exports already given and other important 'contex t variables', such as institutional structure and history in broad terms. At the present stage, it must be stresse d

310

Bent Dalum

Figure 4: Expor t specializatio n i n Ireland, 1961-198 7 Source: IK E trade databas e

that technology polic y programmes apparentl y mus t reflect these conditions , i.e . they must 'fit' wel l with the national context.

4 Nation s and Globalization You may argue that a major part of the discussion in the previous section only occasionally took into account the influence of MNEs on national patterns. Porter' s (1990) analysis of "competitiv e advantag e of nations " i s based o n a fairl y larg e amount of industry studies, in which indigenous and foreign MNEs - a s well as small and medium-sized firms - ar e present. These studie s have been performe d by research team s in ten countries under the guidance of a common framework the so-called diamon d shown in Figure 5. Porter stresses that there is no inconsistency between th e globalization of industries and the significance of national (or regional) context variables. The globalizatio n o f industries and the internationalization o f companies leave s u s with a paradox. It is tempting to conclude that the nation has lost its role in the international success of firms. Companies, a t first glance, see m to hav e transcended countries . Ye t what I have learned i n this study contradicts thi s conclusion. .. . Competitiv e advantag e i s created and sustained through a highly localized process . Differences i n national economic structures , values, cultures, institutions and histories contribute confoundly to competitive success. Th e role of th e home natio n seem s to b e a s strong o r stronge r tha n ever. While globalizatio n of competitio n migh t appear t o mak e th e natio n les s important , instea d i t seem s t o mak e it more so . With fewe r impediment s t o trade t o shelter uncompetitiv e domestic firm s an d

National Systems of Innovation and Technology Policy : The Case of Denmar k

311

industries, th e home natio n take s o n growin g significanc e because i t is the sourc e o f th e skills and technology tha t underpin competitive advantage (Porte r 1990:18-19) .

His "diamond" framework consists of four determinants of competitive advantage. Factor endowments , including infrastructure in broad terms, i s the realm o f both the standar d comparativ e advantag e versio n o f trad e theory an d th e majorit y of analyses of international competitiveness of nations in terms of comparative costs. Strategy, structure and competition contains the dominant analytical approach in two of Porter's previous books (1980, 1985) . It is important to emphasize that he extends the framework of the traditional industrial economics discipline to include company strategies a s a major determinant. 10 Also added shoul d be the emphasis on the effects of domestic rivalry on international competitive advantage.

Figure 5: Porter' s 'Diamond' Source: Porte r (1990:127)

The other two building blocks represent extension s of his previous work, both to a discernabl e degre e inspire d b y Scandinavia n research. Th e characteristic s of domesti c deman d (siz e and , secondl y bu t no t least , qualitativ e features) exert a major influence o n competitive advantage according, to the lin e of thought of Linde r (1961); Verno n (1966); an d Anderse n e t al . (198la , 1981b) . Finally , clusters o f industries , containing both relate d an d supportin g industries, exert a major influenc e i n creating external economies highl y beneficia l t o international competitive advantage. In this case, Porter draws on Hirschman's (1958) linkage and complementarit y approach, a s wel l as o n th e Swedis h "network " approac h in internationa l busines s represente d b y th e Uppsal a Schoo l (se e e.g . Johan son/Mattsson 1989 ) an d by one of their predecessors - Dahmen' s (1970 , 1988 ) concept o f "development blocks" . Th e importanc e o f user-produce r relation s as the micro counterpart o f (non-military ) "industrial complexes", a s elaborated b y Lundvall (1985 , 1988 ) an d Anderse n e t al . (198la , 1981b) , i s also a part o f th e foundation o f Porter's eclecti c framework .

312 BentDalu

m

The "diamond" is characterized a s a mutually reinforcing system. Porter doe s not accept th e concept of national competitiveness as expressed b y a few quantitative indicators, such as wage rates and exchange rates. However, countries may be analyze d in terms of "clusters" of industries . "The basi c uni t of analysi s for understanding national advantage is the industry. Nations succeed no t in isolated industries, however, bu t i n clusters of industries connected through vertical and horizontal relationships . A nation' s econom y contain s a mi x o f clusters, whos e makeup and source s of competitive advantage (or disadvantage) reflect the state of the economy's development" (Porte r 1990:73) . A significant consequence of this line of thought could be sketched as follows: the more European integration is speeded up , the more national/regional context variables ar e important . Thi s als o applie s t o th e competitiv e contex t for smal l firms: homogenous markets call for product differentiation. I f a nation (or region) is no t t o an y significan t degre e a 'hom e nation' fo r larg e MNEs , a s i s the cas e with Denmark , increasin g globalizatio n o f industrie s and firm s make s i t eve n more important to exploit unique local knowledge assets. Whether this is done by Danish or foreign companies is a question of secondary importance . Furthe r upgrading of such assets is the safest insurance premium to pay for future economi c development, unless a country is endowed wit h 'manna from heaven ' in terms of natural resource endowments - fo r instance, oil (which may degenerate industrial development in the long term). As a n illustratio n o f th e cluste r approach, Tabl e 2 show s Danis h expor t spe cialization i n an elaborated versio n of Porter's "Cluster Chart " (see Dalum et al. 1991a:38). The data, in which only product groups with an export specialization above 1 are represented, apparentl y confirms the importance of discernible clusters in the Danish export specialization pattern . Internationally competitive firms are not spread stochastically around the industrial landscape, but are rather - and to a significant exten t - concentrate d i n clusters of industries which are part and parcel of a genuinely unique historical context. In many cases, though not all, the latter covers a unity of political, institutional, economic and geographic factor s i.e. nations .

5 'Socially-Oriented ' Technology Policy in a Danish Context - Som e Examples In the previous section s muc h emphasis ha s been give n to the discussion o f why nations still matter. The cluster analysis has been seen as a useful analytical tool. It can also serve as a means of discussing policy." The interplay between domesti c demand - especiall y governmen t expenditure - an d private firms is an important policy issue added to the well-known emphasis, in all countries, on the quality of

National Systems of Innovation and Technology Policy : The Case of Denmark 31

3

Table 2 : Share s o f "clusters" in Danish Exports, 1961-1987 , i n %

1961

1973

1987

1. Food "Cluster" Meat Dairy products (2) * Fish (2 ) Cereals (4 ) Animal Feed (5 ) Other manufactures Agricultural machine s Food-processing machine s Other relate d machine s Heating & cooling, pumps (24-25 )

30.9 14.3 4.1 1.3 0.9 4.5 1.1 0.4 0.4 3.5

18.8 5.3 4.5 1.4 2.7 4.9 1.4 0.4 0.7 3.8

11.4 3.9 6.7 2.5 0.7 5.0 1.1 0.5 1.2 3.5

Total Of which machinery =

61.4 5.4

43.9 6.3

36.5 6.3

Wood an d wood manufacturin g (7 ) Dyestuffs(17) Domestic electric equipment (32 ) Furniture (39 ) Cement and cement manufacturing Central heating equipment (32)

1.2 0.6 0.3 1.4 0.3 0.1

1.2 0.7 1.5 2.4 0.3 0.4

1.6 0.8 1.1 3.9 0.4 0.2

Total

3.9

6.5

8.0

1.5 0.1 1.0

1.7 0.1 1.2

2.3 0.6 1.3

2. Housing "Cluster"

3. Health "Cluster" Pharmaceuticals (18) Electromedical equipmen t Other medical equipment Total 2.

6 3.

0 4.

2

Ships 3.

4 5.

5 2.

0

Sum of "Clusters" 71.

3 58.

9 50.

7

4. Transport "Cluster"

* Number s in brackets refer to the United Nation's Standard Internationa l Trade Classification, Revision 1 (SITC, Rev. 1). Source: OEC D trad e dat a base , Institut e of Production, Aalbor g Universit y (IKE trad e database)

314 BentDalu

m

science an d technology infrastructure . Existing and/or potentia l new clusters (at present at an embryonic stage) may form the starting point for focusing technology policy efforts . "Social orientation " o f technolog y polic y requires , i n m y view , tha t effort s are directed toward s satisfactio n of the need s o f the genera l publi c by mean s of new produc t o r process technolog y - withou t explicit protectionisti c purposes . The latte r has ofte n bee n th e case in e.g. th e telecommunication s and weapon s industries. Histor y ha s seen man y (non-military) cases wher e suc h fulfilment o f certain 'social ' need s ha s le d t o internationa l excellency amon g privat e firm s who solved the problems in question. The development of the strong competitive advantage of Danish hearing-aid firms is an outstanding example (Jorgensen 1986 ; see also Dalum et al. 1988 ; and Lotz 1991) . However, such cases have most ofte n been studie d ex post. What is proposed her e is to learn from thes e examples in ex ante policy development. In a Danis h contex t a "socially-oriented " technolog y polic y coul d thu s b e programmes focused on development of new (and better) food products and foodprocessing technologies, which may have less detrimental environmental effects.12 Many analyst s argu e tha t Danis h agricultur e and food-processin g i n genera l i s following a 'dea d end ' - i.e . a trajector y o f stead y productivit y increase s i n agriculture by means of fertilizers, exploitation of economies o f scale by merging small farm s to large entities , etc . Th e sam e logi c appears, a t the moment , t o be the main driving force in recent outstandin g structural change in the Danish foodprocessing industr y in term s o f significan t increase s i n merge r an d acquisitio n activity. Another area could be urban renewal and energy conservation technology for buildings, taking its point of departure i n the housing cluster. The approach presented ca n also be used to guide discussions of the content and relevance o f the many and proliferating high-tech programmes, mentione d in the introduction. The high-tec h industrie s usually cover electronics , fin e chemicals , Pharmaceuticals and aerospace. Policy issues and instruments may very well differ between thes e sectors . Th e electronic s industr y wil l serve a s a usefu l example . Full 'coverage ' ha s not been intended. Export specializatio n o f th e tota l Danis h electronic s industr y ha d bee n fairl y low betwee n 196 1 an d 198 7 (0. 4 - 0.7) . I n term s o f expor t structure , around 40% o f Danis h electronic s export s ar e measurin g an d controllin g instruments and electromedical equipmen t in 1987 - a significantly highe r share than in most other OECD countries, as can be seen in Figure 6. Telecommunications is the third subsector wher e Denmark has been specialized , bu t only during the 1970s . That sector contain s wire d telephon e systems , mobil e communication s an d marin e communications. Th e competitiv e advantag e o f Danis h firm s ha s bee n fairl y strong i n the tw o 'wireles s fields' , partl y conceale d b y th e statistica l aggregat e telecommunications in which wired equipment by far has the highest weight . The hig h degree of specializatio n i n instrument s and medica l electronic s ha s been created by small and medium-sized niche firms, of which several are among

National System s o f Innovation and Technology Policy : The Case of Denmar k

1961 computers

1965

1969 telecom

1973

1979 consumer clectr.

1983

1984 electromed

1985

315

1987 instruments

Figure 6: Expor t specializatio n in Denmark - Electronics , 1961-198 7 Source: IK E trade databas e

the worl d leader s i n their narrow fields . Thes e firm s ar e mainl y owned b y their founders o r nea r relatives ; an d th e backgroun d o f thei r internationa l success i s often a combination of the domestic research system , the quality of domestic demand in the initial phase o f the product cycles, an d outstanding entrepreneurship. The competitiv e advantag e o f man y Danis h instrumen t firms has t o a hig h degree bee n base d o n a combination of the R& D syste m an d th e qualit y o f th e public-sector par t o f domesti c deman d - e.g . fro m hospital s and/o r th e mor e general healt h car e system . I n the narro w sence , i t appear s intuitivel y plausible to talk about a 'sociall y oriented' technolog y polic y context here . Bu t the policy proposals shoul d no t be confine d to just mor e researc h i n these nich e fields. Of equal importance may be the quality of e.g. th e health care syste m at large, in its continous functio n a s a prototype user/developer vis-ä-vis firms . However , suc h a definitio n ma y be too narrow - o r even 'romantic ' i n its more o r less explicit purpose of reaping some productiv e side effects from welfare state governmental consumption. The sector o f marine communications has the same industr y characteristics as the instrumen t sector ; whil e the field of mobile communications previously was

316 BentDalu

m

dominated b y tw o Old' , originall y indigenous firms, both acquire d b y foreig n multinationals in the mid-1970s (Storno by General Electric, and subsequently by Motorola fro m 1986 ; and A.P. Radiotelefon by Philips). The mos t important factors behind these companie s i n the 1980 s have been a combination of regulation by the Nordic PTTs - wh o launched the pathbreaking Nordic Mobile Telephon e system (NMT) in 1981 - an d local research excellence . Th e Danish mobile communications industry also contains two small Danish newcomers (founded in the 1980s), of which one has been aquire d by a German company. The NMT syste m was a major 'socia l innovation', even brought about by cooperation betwee n fou r telecommunications monopolies (the PTTs) in the Nordic welfare states . "Social orientation" may thus be conceived a s fulfilment o f demands expresse d by th e general publi c and transmitted into the political decision-makin g process at some stage. Besides the health sector and telecommunications13, such demands are represente d b y e.g . les s pollutio n o f soil , ai r an d water ; exploitatio n o f al ternative energ y source s an d derive d chang e i n energ y distribution ; expansion of collective transpor t systems; etc. Small welfare states, suc h as Denmark, may be in a favourable position to develop solution s for such problems, because they inherently require a combination of social an d technological innovations. "Socially-oriented" technolog y policies ma y thus be conceived a s policies de signed to solve technological bottlenecks which may deter social innovations . The selection criteri a fo r investing scarce governmental resources i n technology pol icy programmes coul d be existing competitive strength in discernible cluster s of industries and/or commitment to participate in spurring the creation of new ones. The recen t Danis h Enviromenta l Technolog y Developmen t Programme , fro m spring 1991 , indicates that such an approach ha s (re)capture d a more prominen t role in governmental policy.

Notes [1] I t wa s als o o f importance , tha t th e decisio n coincide d wit h appointmen t of a ne w minister of industry , who defende d th e polic y profil e a s a n offensiv e strategy . Th e rhetorics surrounding the new approach was to some extent conceived a s a neo-liberal (read Thatcherite) mov e by the general public . [2] Fo r an introductory discussion of that concept, se e Andersen/Lundvall (1988). For a more extensiv e treatment, see Lundvall (1992) . [3] Fo r a discussion, see Christiansen (1989, 1988 ) an d Sidenius (1989). [4] A t least tha t is how Dalu m et al . (199la) have interpreted th e evaluation reports of the programme . [5] Th e indicator of technological specializatio n is calculated by the same expression a s used and explained below fo r the analysis of export specialization . [6] Th e empirica l materia l use d i n thi s sectio n i s presente d i n mor e detai l i n Dalum (1992). The trad e analysi s is based o n th e OEC D trade databas e a t the Institut e of

National Systems o f Innovation and Technology Policy : The Case of Denmark 31

7

Production, Aalbor g University (the IKE trade database) - develope d b y the author and Jan Fagerberg. Se e also Fagerberg (1988a). [7] Th e volatilit y o f oil and ga s disturb s the general pattern of stability , independent of country size . [8] Thi s aggregation focusses on the research conten t of the products, and not on process technology - i.e . a partial analysis of the export specialization pattern . In interpretation of th e results , it is important to have this reservation i n mind. In spite of these , the aggregatio n o f technolog y intensit y (base d o n researc h intensity ) is considere d to be useful b y the present author. There i s thus a high correlation between high-tech and high-growth products (for detailed documentation, see Fagerberg 1988a) . Notice also tha t th e definitio n o f high - versu s medium-tec h i s differen t i n 1961-196 9 a s opposed to 1973-198 7 - indicate d by a vertical line in the figures. Fo r a conceptual discussion an d empirica l analysi s o f Swede n alon g th e sam e lin e o f thought , see Edquist/McKelvey (1991) . [9] Th e lac k o f Swedis h specializatio n i n high-tech goods has , however, recentl y bee n interpreted as a problem fo r both present and future Swedis h long-term productivity growth an d economi c performanc e i n general . Se e Edquist/Lundval l (1993 ) an d Edquist/McKelvey (1991) . [10] I n Porter (1980), strategies ar e applied as "structural" variable s in the analysis of the internal substructur e of industries - especiall y i n defining "strategi c groups " a s an analytical tool for applied industr y analysis (see e.g . chapte r 7). [11] Th e followin g discussion is based o n Dalum et al. (199la). It should be stressed that the presen t autho r finds Porter's eclecti c framewor k useful a s devic e fo r structural analysis and a s a point of departure fo r policy discussions . However , I have severa l critical reservations on the actual analysis of and proposals fo r government policie s in hi s chapters 12-13 ; for a further elaboration see Dalum et al. (1991b). [12] A food-processin g technolog y programm e ha s actuall y bee n starte d i n Denmar k recently, despite cuts in appropriations in December 1989 . [13] Thi s woul d be true assumin g that a moder n telecommunication s network is a sine qua non for a high income welfare state - althoug h the most visible feature of mobile communications initially ma y have appeared t o be the service of 'yuppie ' demand .

Ϊ tent Dalum

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