WEEK 12 PRESENTATION BRIEFING

MODULE 3 – POLICY ISSUES FOR BUSINESS Objectives and Key Themes: To appreciate the rationale for business policy. To recognise the importance of policy for individuals, businesses and nations. To appraise and critically evaluate the link between different theoretical perspectives and policy. To understand selected policy issues in some depth. To place the individual firm within the context of its economic, technological, social and policy environment. To express a considered opinion on policy issues in the light of your reading of the course materials. Demonstrate an awareness of current affairs related to business studies and particularly the area of policy.

The reader is divided into 6 sections: Policy: significance and rationale Competition policy Science, technology and innovation policy International trade and investment policy Regional policy Environmental policy Each of these sections will be studied in 2 weeks of your timetable.

Policy: Science, technology and innovation policy In Section 3 we examine some of the links between science, technology and innovation, and the role policy can play in facilitating progress in these interrelated areas.

Chapter 7 – Science Policy and Technology Policy by Metcalfe. This chapter discusses some important issues related to science, technology and innovation. Metcalfe distinguishes between science and technology – they are interdependent but distinct bodies of knowledge that are both required as inputs into wealth creation.

Small Group Work In your section draw up the differences between science and technology.

Key points to summarise discussion You should have identified that: Science is open and academic, with its inputs widely diffused in international publications. It is a public good. Research is carried out in universities or other research institutions paid for by taxation. Technology is closed, practical and paid for by firms through the market mechanism.

Metcalfe claims that the distinction between science and technology is such that it is misleading to think of technology as applied science. Do you agree with Metcalfe? Discuss this with your tutor in your section. Justify your answer.

Metcalfe’s view. Metcalfe discusses the traditional economic rationale for technology policy which is based on the existence of notions of multiple kinds of market failure including those caused by externalities, indivisibilities, uncertainty and the public good nature of some kinds of technology. In his view, technology policy should aim to provide a support system to firms that would include the public support of science and the facilitation of information flows between private firms and research instititutions.

Programmes to facilitate scientific and technological development Metcalfe discusses the Foresight programme in the UK. Can you think of any programmes in the Middle East of a similar nature?

Chapter 8 – National Systems of Innovation by Freeman. Freeman discusses his notion of the national system of innovation and provides some historical examples of how such systems evolved and were created. Freeman argues that technological innovations depend of a host of social innovations for their successful creation and sustenance.

History Freeman describes the historical context of science and technology – particularly in wars. He asks whether the growing scale of operation of MNCs in recent times is increasing the internationalisation of innovation and is reducing the importance of national factors in innovation. Is the system of innovation becoming less national in character?

Section discussion Based upon your reading of chapter 8, do you agree with Metcalfe’s view?

Activities Activity 6 on page 23 of the policy study guide. Self check on page 23 of the policy study guide.

READING TO BE COMPLETED BY NEXT WEEK Please read pages 22-25 of the Policy Study Guide to refresh your study of Chapters 7 & 8 of the Policy Module. Please read Chapters 9 & 10 of the Policy Reader