Building a strong s&t system in Indonesia - policies in a transitional economy

Abstract

An indication of a developing country that has strong S&T system can be characterized by its ability to assimilate and develop manufacturing and high-technology from outside its boundaries, and eventually become competitive in manufacturing and hi-tech product. An S&T system may pose four elements included (1) national commitment to technology-based development, (2) technological infrastructure, (3) socio economic infrastructure, and (4) productive capacity. Government could provide direct intervention policy, i.e. science and technology (S&T) policy or industrial policy, that promote S&T development. The policies reflect support for strengthening the first two elements of the S&T system: i.e. national commitment to technology-based development and technological infrastructure. The government could also provide indirect policy, i.e. economic policy, that ease and increase domestic and foreign direct investments in manufacturing and hi-tech industries. This eventually may allow firms acquire technological capability through learning by adopted" industrial practicing. These policies portray support for strengthening the last two elements of an S&T system: socio economic infrastructure and productive capacity. Indonesia has been implemented both policies in order to strengthening the S&T system and to accelerate industrialization. The first policy is implemented through specific S&T policy that supports the development of government owned hi-tech "strategic" companies. The second policy