Losing the battle, winning the war: Intellectual property protection and high-tech development in Asian newly industrializing countries

Three Asian newly industrializing countries (NICs)--South Korea, Singapore, and Taiwan--have been pressured by the United States to tighten intellectual property rights (IPR) protection. Such protection has made it more difficult for the NICs to imitate those innovative works of others and more costly for them to acquire advanced technologies. Structural realism suggests that smaller states would be losers in the face of pressures from a bigger state because power disparity between advanced and developing countries in the international system has already determined the outcome of trade disputes. Although the NICs lost the battle by accommodating the U.S. demands in tightening IPR protection, they won the war in achieving a higher level of technological development. The study argues that cooperative relationships between East Asian states and key societal groups have enabled them to design effective national technology strategies and to reduce structural constraints. In addition, strong states enabled these NICs to build effective institutional arrangements to address the problems of industrialization and the move to high-technology sectors.; These case studies reveal similarities and differences among the national strategies of the three countries. Similarities include attention to the development of a strong institutional infrastructure, enhancement of human resources, and the maintenance of stable industrial relations. Furthermore, the NICs can turn structural disadvantages into industrial opportunities and that is well illustrated by these NICs' efforts to extract technological capabilities from MNCs. At the same time, differences in domestic resources, national history, industrial structure, and strategic intent led to quite distinctive strategies. Singapore, the smallest of the three, focused on a niche market strategy, particularly in information technologies. Korea adopted a more ambitious strategy to achieve broad technological prominence in areas where advanced nations already had achieved prominence. Taiwan's approach was to create industrial clusters in particular high-technology sectors and gradually achieve market dominance in those areas.