Technological Learning, Institution Building and the Microeconomics of Import Substitution

Abstract

Our characterization of the substitution process is definitely very different from that offered to us by the neo-classical mainstream in the profession, and covers a large number of dynamic historical factors which the neo-classical tradition simply misses. Rather than issues of static inefficiency in the alloca-tion of resources, our analysis places emphasis on long-term dynamic aspects related to the maturing of the society's internal technological capabilities. Just as in the case of technological learning, where a microeconomic approx-imation of the real world in developing countries allows us to identify and describe a great variety of facts and variables which the neo-classical research agenda simply leaves aside, the same happens when we approach the subject of institutional development. It is another `black box' about which conventional theory has little or nothing to say. We will explore this subject in the following