10 Merits (positive implications) of Technology transfer
- It helps to bridge the technological gap in developing countries. The local people learn and adopt the imported modem production techniques hence improving on their efficiency in production. This leads to the production of better quality goods and services.
- It helps to create a class of modern business entrepreneurs. Through foreign direct investments, people in developing countries can have access to technical and managerial skills required to operate modem business enterprises. For example doing business on internet.
- It leads to the development of social and economic infrastructure. Technology transfer promotes the use modem equipments in road construction, schools, hotels, hospitals, financial institutions etc. For example the; use of computers in schools and financial institutions.
- It encourages competition in the local business activities. Technology transfer promotes competition and this leads to efficiency in production of goods and service delivery at reduced prices hence better standards of living. For example the mobile telephone industry.
- It increases efficiency in resource allocation. Technology transfer encourages the use of efficient techniques of production which leads to the production of more quality goods and services hence better standards of living.
- It promotes the exploitation and utilization of the local idle resources. This helps to improve on the productive capacities in the economy hence economic growth and development.
- It promotes industrial development. Technology transfer by foreign investors is used to set up heavy and sophisticated industries like iron and steel industries, electrical installations etc.
- It increases capital inflow in the country. Technology transfer by foreign investors leads to capital inflow in form of machines and other capital equipments needed for development. This helps to fill the savings- investment gap in developing countries.
- It helps to reduce the balance of payment problems in the country. This is because technology transfer increases the production of better quality goods and services for export hence increased export earnings.
- It promotes international ties and relations between developed and developing countries. This enhances mutual understandings among countries.
CATEGORIES Economics
TAGS Dr. Bbosa Science
