Template-type: ReDIF-Paper 1.0
Author-Name: Mani, Sunil
Author-Email: mani@intech.unu.edu
Author-Workplace-Name: United Nations University, Institute for New Technologies
Title: Government and Innovation Policy An Analysis of the South African Experience since
	 1994
Abstract: South Africa used to follow a policy of import substitution, necessitated by
	 subscription to apartheid. However, following the democratic elections of 1994, the
	 country abandoned this policy and put in place a whole host of measures to increase
	 its industrial competitiveness. Policy makers gave specific attention to achieving
	 this goal through technological development. The country has shown considerable
	 sophistication in framing the necessary policies and institutions to hasten this
	 process of domestic technology development coupled with a better absorption of
	 imported technologies. However, South Africa has not shown as much sophistication
	 in implementing and evaluating these otherwise laudable policies. For instance, a
	 significant number of research grants have been made available to its innovation
	 system comprising the higher education sector, the science, engineering and
	 technology institutions(SETIs) and the business enterprise sector. But this has not
	 resulted in desirable results, as the R&D intensity and the number of patented
	 innovations continues to be low. An analysis of the real weaknesses of the
	 innovation system shows that the country suffers from a severe shortage of
	 scientists and engineers who can engage in R&D. The reason for this is a near
	 stagnant enrolment in science and engineering subjects and possibly migration
	 abroad. Without addressing this basic lacuna in its innovation system, the country
	 has put in place three sizeable research grants. Given the limited number of
	 researchers, these research grants run the risk of "crowding" themselves out. Thus
	 the South African case once again confirms our hypothesis that countries may not be
	 successful in stimulating R&D in their enterprise sectors by merely fine-tuning
	 financial instruments such as research grants and tax incentives. For financial
	 instruments to be very effective, there has to be a critical mass of research
	 scientists and engineers.
Keywords: Research and Development, Innovation Policy, Government Policy, South Africa 
Series: Discussion Paper
Creation-Date: 2001
Number: 2001-02
File-URL: https://www.merit.unu.edu/publications/discussion-papers/2001-2.pdf
File-Format: application/pdf
File-Size: 302 Kb
Handle: RePEc:unm:unuint:200102