bHAC'YAVAN M.R.: A Critique of. Appropriate Tecbnoloay. for
 Underdeveloped Countries. RCMlI'Ch Report No. 1/ SetmdlnavlDn
Institute ol.A,fr/l:tln Stut:Ila Uppatl/Q. 19'79.
     Bhagavan's report IS in-two chapters. Chapter one is .essentially a critique of the
 OECD, World Bank and USAID approaches to the question of appropriate technology
 for developing countries. In Chapter two the auth~ critically reviews the choiqe of
 techlJiques arguments in manufacturing. Here the author takes a close and critical look
 at the book published recently by the ILO on this subjt':t (A.S. Bhalla ed Technology
 mid Employment in Industry. Geneva 1975).
     In chapter one the author summarises the OPCD, World Bank ~d USAID
 a\Jproaches. The author presents the views of tht>:>eorg .......  1imtions on issues like
 drawbacks of modem technology, definitions of other technologies, the innovation
 system and promotion of appropric:te technology.
     The author criticizes .the DECO, World Bank and USAID premise that the
 underdeveloped countries (DOCs) cannot, within the foreseeable future, increase the
 size of their modem industrial sectors to meet the development requirements of their
 entire populations. This premise, the author argues, ccllaps~ where structural changes
 and mobilization of labour for building capital projects take place, and where the
internal and external political situations have changed dramatically leading to
 revolutionary regimes which hav~ altered the structure of their economies in favour of
 the masses (e.g. China, r.rorth Korea, Vietnam, Cuba, Mozambique, Angola).
     The argument that use of capital intensive techniques causes unemployment in urban
areas is criticized by the ~uthor on the grounds that the principal cause of migration of
the rural population to urban areas is the breakdown of agricultural production and
 agrarian system. The solution, it is argl.ed, lies in the pursuan~e of a strategy of high
rates of growth in industrial and agricultural production geared to mass consumption
and producer goods. The author does not elaborate on the requiremerits of such a
strategy neither does he specify that the implementation of such a strategy is only
possible under specific social and political systems.
     Contrary to the other approaches, the author aJ:gues that modem technology and
modem indusrry have stimulated rather than inhibited the awaren:::ss of the need to
innovate 10001ly. While I think this is correct, it does not seem to be sufficient ground to
rej~t the argument that importoo modem technologies contribute to inhibiting the local
innovative capacity. Whethe!"modem technology inhibits or stimulates local innovations
depends on the type of modem te.ch.iology chosen and the sector into which it is used
and the local technologies existing and operating in the sector. It does not seem
legitimate to make universal conclusive statements or-ihis issue. I have argued elsewhere


                                                                Utafiti-Vol. 5 No. 2 DKember 1980
  (Wangwe 1980) that policies about choice of technology, trade, manpower development
  and choi~-of industrial activities can greatly influence the outcome of the relationship
  betweenmodern technOlogy and the local innovative capacity.
      In the petty commodity production mode (the informal sector), the author argues,
  meaningful innovations have to be based mainly on the mobilizat~on of labour.
  Organization of collective labour at the small community level is identified by the author
  ~. t.he prime software that will be required. The author cautions that these should be
  mItlated and led by members of the local community with maximum participation and
  ~nimum coercion. The function of appropriate tecluiology groups as the OECD
  stIpulate should not be to spread technically detailed information about hardware but .
  this function should not extend to software, the author c-oncedesto this.
      The author proceeds to argue that the fact that the approaches (OECD, World Bank
  and USAlD) attribute to the innovation process an inherent non-egalitarian impact is a
  reflection of their failure to see that the non-egalitarian impact of innovation arises froni
 the class nature of society. What the author fails to see is the interdependence between
 technology and inequality in society. While the Class structure in society leads to the
 non-egalitarian impact of the innovative process the latter may reinforce non-egalitarian
 tendencies in society.
      On the domestic skills the author rightly disagrees with the blanket fashion argument
 that more modern industries cannot be set up in UDCs because of present lack of
 sufficient numbers of skilled workers. While quantity and quality of available
 ~power        should be taken into account in making technological decisions' it is
 lIDpOrtant to realize that manpower training and manpower planning in general cannot
 be divorced from technological considerations either.
      The author tackles the important question of who benefits from appropriate
technOlogy. He argues that appropriate technology cannot benefit the poor under .the
present political-economic          configurations in non-socialist UDCs'. Appropn~te
technology, he concludes will benefit innovators in the petty commodity production
mode, the established and emerging small capitaliSts in agriculture and industry and
perhaps most of all the business firms in North America, Western Europe and Japan. I
?nd it improper to pose the question of who will benefit from a~propriate ~echnol~
mdependent of the political and social-economic strUCture of spectfic countnes. This ,.S
therefore a question. to be tackled country by country and its answer cannot be sought In
the blanket f<!Shion.
      In chapter two the author. critically reviews the choice of techniques arguments in
manufacturing.       The author specifically raises critical points on the recent book
published by the ILO on this topic (Bhalla 1975).              f.I~ questions ,the method,. the
assumptions and the models used in the book in the chOtce of techniques calculations
and proceeds to discuss the results of the case studies presented in the book.
      The author criticizes the method used for being based on neo-classical eco~omic
theory where profitability is judged via economic efficiency and where calculation of
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economic efficiency use only capital and labour.
    The author points out that the ILO study makes some assumptions which are so
unrealistic that it is legitimate to reject calculations based on them. Problems in
measurement of capital and labour are discussed. The neglect of capital intensity in the
intermediate products industries and the effect of monopoly on value added figures
render the calculations of little use. The author then proceeds to summarize the results of
the case studies presented in the ILO study. The author argues that the choices implied
by results of the case studies in the ILO study diverge from the choice actually made by
firms and governments precisely because of weakness in the method, assumptions and
models used.
    The thrust of the critique of the ILO book by the author is based on the "method,
assumptions and models" used. In my opinion the contributors to the book do not
appear to use a common model in their analysis; at least not all of them rely entirely on
the neoclassical model. The neoclassical approach focuses on capital and labour and
their factor prices as if that is all that matters in choice of technology. The empirical case
studies (in the ILO study) on copper and aluminium, textiles, sugar processing, cement
blocks show clearly the significance of the price and quality of raw material inputs.
Contrary to the author's view that the ILO study ignores working capital and heterogeity
of labour the case study on sugar processing demonstrates the significance of working
capital while the case study on. can manufacture demonstrates the significance of
different qualities of labour. Contrary to the neoclassical tradition, the role of the
product-mix or product quality has been shown in the case of cement blocks, can making
and sugar processing. Contrary to the assertion that the studies on the choice of
technology assume perfect competition it is clear from studies on second-hand
equipment, can making and Colombian engineering industry that different market
structures influence choice of technology. On the whole the author rightly points out
that the neo-classical model is an inadequate tool for the analysis of choice of
technology. The author, however, may misleadthe reader by giving the impression that
the current arguments on choice of techniques in manufacturing industry are
represented wholly in the neoclassical tradition. It is more proper to regard the
neoclassical choice of techniques arguments as one set of arguments within the more
broad debate on this issue. Clearly, in some respects as shown above,.even the ILO study
goes beyond the realms of neoclassical economic theory.
                                                                                                 S. M. Wangwe
                                          REFERENCES
1.  Bhalla, A.S. (ed) Technology and Employment in Industry Geneva 1973.
2.  Stewart, F. Technology and underdevelopment MacMillan 1977
3.  Wanjwe, S.M. Capacity utilization and Capacity creation in manufacturing with special reference to the engineering
                   sector. Unpublished Ph.D. thesis. University of Dar es Salaam, 1980.
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