Abstract
This thesis examines the scope for developing countries, and in particular those with a
socialist tradition like China, to benefit from advanced technologies developed in the
West and acquire indigenous technological capacities. Empirically it investigates China's
attempts to acquire capabilities in the highly complex field of - Public Digital Switching
Systems (PDSS) - the technology at the heart of modern telecommunications systems
and therefore of great social and economic importance.
The study builds upon a critical review of literature in three areas: development studies,
studies of socialist economies and technology studies. It explores how developing
countries might utilise exogenous technological competencies effectively, by means of
'dual technology development' with appropriate strategies for technology transfer and
processes of technological learning to transform exogenous competencies into
indigenous ones.
Two detailed cases studies are presented and analysed in the wider social and economic
context. One involves the wholesale transfer of capabilities to produce a Western PDSS
technology in China (System 12) through a joint venture project. The other involves the
indigenous development of a Chinese PDSS (HJD-04) conceived by a military R&D
institute, and brought to production through a collaboration with two other bodies in the
Chinese telecommunication sector. These cases highlight the range of choices available in
the acquisition of technological capabilities - from large scale and formal technology
transfer (System 12), which provided a wide range of means for technological learning,
to the selective import of component technologies (HJD-04) and their effective
combination with locally available expertise. They offer different opportunities for further
innovation and for local shaping of these technologies.
The cases also throw light on the influence of the economic reforms on the technological
dynamism of China's 'national system'. In particular, the introduction of market
pressures provided important incentives for R&D institutes and producers to become
more responsive to their customers and to work together. Economic necessity forced
them to compete in the market and meet customers' requirements for high product
quality. The cases demonstrate the need for continued state intervention to provide
frameworks for market mechanisms to encourage technological co-operation, to balance
local and national interests, and to reduce negative social consequences. In light of the
changing and diverse forms of state intervention in China, the thesis argues that market
dynamics and public policy should be complementary.
