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Int Econ Econ Policy (2010) 7:245–265 DOI 10.1007/s10368-010-0164-x ORIGINAL PAPER Competences for green development and leapfrogging in newly industrializing countries Rainer Walz Published online: 30 May 2010 # Springer-Verlag 2010 Abstract Competences for green development and leapfrogging in Newly Industrializing Countries are becoming increasingly urgent from a global perspective. The integration of these innovations into the development process in the rapidly growing economies requires knowledge build-up and technology cooperation. The prospect of exporting sustainability technologies can add an incentive for them to move towards sustainability technologies. These issues also affect innovations to increase material efficiency, which are receiving increasing interest among sustainability innovations. The competences for green development are analyzed with an innovation indicator approach. The general innovation capabilities are evaluated using R&D indicators and survey results about general innovation capabilities. Technological competences in the sustainability fields are a key indicator for the absorptive capacity of sustainability technologies and for the ability to export them. International patents and publications, and successes in foreign trade indicate to what extent a country is already able to participate in global technology markets. The resulting pattern shows various strengths and weaknesses of the analyzed countries. In general, the knowledge build up in material efficiency strategies is above-average in the Newly Industrializing Countries. There is a strong need for strategic positioning of the countries and for coordination of the various policy fields involved. Keywords Sustainability technologies . Absorptive capacities . Patents . Trade patterns . Material efficiency . Newly industrializing countries JEL Classifications F14 . O14 . O3 Acknowledgements The author is very grateful for the suggestions provided by two anonymous referees. He also wants to thank his colleagues Rainer Frietsch, Nicki Helfrich and Frank Marscheider-Weidemann from Fraunhofer ISI for their help in data search. The financial contribution of the German BMBF is acknowledged. R. Walz (*) Fraunhofer Institute for Systems and Innovation Research, Breslauer Strasse 48, 76139 Karlsruhe, Germany e-mail: rainer.walz@isi.fraunhofer.de
246 R. Walz 1 Introduction Competences for green development and leapfrogging in Newly Industrializing Countries (NICs) are becoming increasingly urgent from a global perspective. This also holds for innovations to increase material efficiency, which are receiving increasing interest among sustainability innovations. The integration of these innovations into the development process in the rapidly growing economies requires knowledge build-up and technology cooperation. The prospect of exporting sustainability technologies can add an incentive for Newly Industrializing Countries to move towards sustainability technologies. The first part of the paper deals with conceptual issues. First, the importance of innovation and technology cooperation are discussed within the traditional view of environmental economics on global environmental challenges. Prerequisites for successful technology cooperation and export success in international trade are presented. Secondly, the empirical research concept to measure capabilities for green development is explained. The remainder of the paper analyses selected NICs. The empirical results include the general framework condition for sustainability innovations. The technological capabilities in sustainability technologies are analyzed. They comprise 6 fields of sustainability technologies: (1) material efficiency, including renewable resources, ecodesign of products and recycling, (2) environmental friendly energy supply technologies, including renewable energy, cogeneration and CO2 neutral fossil fuels, (3) energy efficiency, both in buildings and in industry, (4) transport technologies, (5) water technologies, and (6) waste management technologies. These technological fields are analyzed with innovation indicators such as publications, patents and trade. In an additional section, disaggregated results are presented for the case of material efficiency. Based on these results, first conclusions for the role of sustainability innovations for the economic development process in NICs are drawn. Finally, the limitations of such an indicator based overview are explored. 2 Conceptual issues 2.1 Prerequisites for leapfrogging There is general consensus that environmental sustainability requires an integration of environmental friendly technologies in the economic catching up process of Newly Industrializing Countries (NICs). Since the seminal paper of Grossmann and Krueger (1995), this challenge is discussed within the concept of the Environmental Kuznets Curve (EKC). According to the EKC-hypothesis, environmental pressure grows faster than income in a first stage of economic development. This is followed by a second stage, in which environmental pressure still increases, but slower than GDP. After a particular income level has been reached, environmental pressure declines despite continued income growth. Graphically, this hypothesis leads to an inverted U-curve similar to the relationship Kuznets suggested for income inequality and economic per capita income (Fig. 1).
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