International technology transfer and the dynamics of complementarity: A new approach Mehdi Majidpour Department of Management, Science and Technology, Amirkabir University of Technology, 424, 3rd Floor, Farabi Building, Rasht Street, Hafez Avenue, Tehran, Iran abstract article info Article history: Received 8 May 2015 Received in revised form 4 March 2016 Accepted 9 March 2016 Available online xxxx Latecomer firm's catch-up through indigenous R&D and cross-border technology transfer embeds various influencing factors that are present simultaneously – beyond the will or power of managers and policy makers – and that have to be recognised, analysed and taken into account. Despite the increase in literature on substitu- tion/complementary relationship, some ambiguity remains in understanding the complexity of complementing between indigenous and overseas technology sources. Unlike the majority studies on complementarity, this paper suggests the dynamic approach by which scholars are able to reach a deeper understanding of the dynamics, challenges and difficulties of these relationships. This study builds a theoretical framework to being operationalized in the context of Iranian latecomer firm located in gas turbine industry. This paper shows that taking the dynamic approach is able to reveal the strategies by which the latecomer firm deals with the difficulties of acquiring advanced technologies. Although complementary relationship exists, it is a strategic vision to understand how a latecomer firm complements its indigenous efforts with overseas technology sources. Different kinds of insights will be provided in terms of national-, industry- and firm-level factors and the strategies by which a latecomer firm can deal with these factors. © 2016 Elsevier Inc. All rights reserved. Keywords: Technology transfer Catch-up Complementary Dynamic approach Iran 1. Introduction Technological catch-up studies argue that both indigenous efforts and overseas technology transfer are the key elements of latecomer firms' catch-up. On one hand, the literature underlines the accessibility of foreign technology and international technology flows from leaders to followers as a significant part of the process. On the other, it empha- sises indigenous innovation and learning systems and highlights the im- portant role of institutions, organisations and interactions in enhancing domestic technological capabilities. In this view, a number of studies have tried to understand the relationship between indigenous and over- seas technology sources. Some of them have shown that these two main technology channels are alternatives or substitutes, while others have argued that the channels are complementary. Regardless of the small number of such studies, especially in a developing country context, the majority of the existing literature has placed too much emphasis on the ‘correctness’ of one of these ideas. They have often examined the type of relationship and paid inadequate attention to its dynamics, challenges, and difficulties. Although some of the studies (Bell and Pavitt, 1993; Pack and Saggi, 1997; Radosevic, 1999) have criticised the static viewpoint of the existing literature and have posed interesting questions about the dynamics of technological development of latecom- er firms, the issue has barely been touched upon. These studies have left unanswered the nature and the details of dynamics. In this light, this paper, instead of examining only the type of relationship between indigenous technology development and over- seas technology inflows, delves deeply into the dynamics. Based on a case study method and examining the Iranian Company — MAPNA, this research provides theoretical insights into the following questions: What have been the dynamics between indigenous technology devel- opment and overseas technology transfer for a latecomer firm intends to catch-up? How a latecomer firm can manage influencing factors in order to complement its indigenous technology development efforts with overseas technology inflows? 2. The conceptual framework The first aspect of the technological catch-up concept is the important role of foreign technologies in enhancing domestic firms' technological capabilities. Radosevic (1999) argues that the catching- up literature builds upon the proposition that technology followers benefit from technology leaders (1999). Other important aspects which are highlighted in the literature on technological catch-up are the active role of domestic firms, the typology of their interactions, and the contributions of institutions, financial systems and infrastruc- ture. Framed in this way, the technological catch-up process cannot be reduced to merely transferring technology from developed countries and imitating their routines among latecomers. Rather, indigenous ca- pability building has become, and will continue to become, of ever greater value (Mazzoleni and Nelson, 2007). Technological Forecasting & Social Change xxx (2016) xxx–xxx E-mail address: majidpour@aut.ac.ir. TFS-18460; No of Pages 11 http://dx.doi.org/10.1016/j.techfore.2016.03.004 0040-1625/© 2016 Elsevier Inc. All rights reserved. Contents lists available at ScienceDirect Technological Forecasting & Social Change Please cite this article as: Majidpour, M., International technology transfer and the dynamics of complementarity: A new approach, Technol. Fore- cast. Soc. Change (2016), http://dx.doi.org/10.1016/j.techfore.2016.03.004