Libro Blanco Vol I en Ingles

TOWARDS A NATIONAL INNOVATION STRATEGY FOR COMPETITIVENESSVOLUME 1The advocates of import substitution policies claimed that the prices of manufactured products wouldcontinue growing with regard to commodities and that therefore countries whose economies were based onnatural resources would be condemned to underdevelopment. They claimed that the great advantage thatmanufacturing industries had over natural resource-based industries was that, since they could absorb technicalchanges, they could create, at least for a while, a monopoly over this technical innovation that would provide arent for the producer of the manufactured product. This rent, in turn, would allow for investment in newchanges that would produce new rents when the initial monopoly was diluted as a result of imitation by thecompetition. Thus, the cycle could persist over time, deteriorating the position of commodity-based industriesever more.However, the latest empirical studies contradict that argument, busting the oft-cited “natural resourcecurse” 5 . The evidence rather indicates that neither manufactured products nor commodities have any specialsource of dynamic earnings favouring only one sector 6 , even though manufactured products have the initialadvantage of being able to add value to their products.Moreover, economic research today shows that the prices of commodities do not deterioratesystematically with respect to manufactured products 7 and this has led, for example, the World Bank to state in– From natural resources to the Knowledge Economy: Trade and Job Quality - that natural resources andknowledge are a perfectly possible growth formula, thus contradicting the more pessimistic viewpoints that5 The term was coined by Richard Auty in 1993 to describe why countries rich in natural resources are not capable of using that wealthto make their economies grow and why these countries have a lower economic growth than others that are not abundant in naturalresources. According to Joseph Ramos (1999), even though the data seems to support this thesis, it is more an empirical relationshipthan an analytical one. In effect, the good or bad performance of countries rich in natural resources is not inevitable, but is rather aresult of how good its development policy is and not on the mere fact of having natural resources.6 Bosworth, Barry and Susan M. Collins. The empirics of growth: An update. Brooking papers on Economic Activity, Nº2, 2003. Theevidence provided does not show that the component of total factor productivity stands out more in developed manufacturingcountries versus natural resource intensive ones, even though this, in any case, does not allow concluding that there is no difference intechnological absorption capacity. The result could be due to a particular concern for innovation in developed countries that areintensive in natural resources.7 Lederman, Daniel and William F. Maloney. Neither curse nor destiny: Natural resources and development. Stanford University Press.October 2006. This is because, after a while, innovations in manufactured goods are diffused and become public goods that others candiscover and use, which ends up depressing prices. What happens is that the prices of commodities are much more cyclical, and canimply great blows for countries dependent on natural resources if they do not have macroeconomic management systems to help themface those market variations.26Empirical studies indicate that there isno special source of dynamic earningsfavouring a particular sector, incommodities or manufacturing, and thattechnical change depends more on howit is produced -that is, if knowledge isadded or not- than on what is producedIn fact, the key to productivity lies, moreso than in the production structure, in theparticular concern for innovation, as hasbeen demonstrated by natural resourceintensivedeveloped countries.Furthermore, a country strong in innovation–with more demanding consumers, moredynamic companies, more skilled workersand a supportive government – is betterprepared to face the uncertainties producedby the present competitive environment.