services. For such a demand to exist, institutions 

 must exist to use the talents of such individuals 

 profitably, and there must be a flow of resources into 

 those institutions. In private market economies, these 

 institutions are largely business firms, and the 

 marketplace provides a flow of resources to those 

 performing a desired function in the society. In 

 socialist economies, these institutions are often 

 state-owned enterprises, and the flow of resources 

 comes from a central allocation process. 



In developing countries, the necessary demand is 

 sometimes weak, and, even when latent demand exists, 

 the relationship between industrial research 

 institutions and potential users is not well developed. 

 The contribution of technological advances to economic 

 growth is measurably large. Yet, even in advanced 

 industrialized countries, some corporations do little 

 or no in-house research and development, while others 

 perform a great deal. Indeed, entire industrial 

 sectors can be characterized by low or high rates of 

 investment in research and development. While a 

 correlation is observable between high rates of growth 

 within an industrial sector and high rates of research 

 and development performed by firms operating within 

 that sector, the direction of causality is not entirely 

 clear. All countries, developed and developing, need 

 to learn more about relationships between the extent, 

 form, and manner of technology development and the 

 character of socioeconomic progress. Initiative 8 

 addresses this need. 



Most of the initiatives presented here address the 

 supply side of the reguirements outlined above. These 

 initiatives cannot by themselves fully create the 

 capability that developing nations need for providing 

 suitable industrial technology. This depends heavily 

 on the extent to which overall economic policy and 

 institutional development foster industrialization and 

 a demand for better technology. Yet each of these 

 initiatives could help developing nations move a step 

 or two closer to having the needed industrial 

 technology capabilities. 



Initiative 1. Expand U.S. Assistance for Creating 



and Developing Engineering and 

 Management Training Institutions 

 in Developing Nations 



Despite a number of successes, a need still exists 

 in developing countries for additional engineering and 

 management training schools and for upgrading the 

 quality of existing institutions. 



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