TECHNOLOGICAL INNOVATION IN BRAZILIAN AND ARGENTINE FIRMS The Editors João Alberto De Negri Lenita Maria Turchi The Authors Andrés López Adrián Ramos Adriano Ricardo Baessa Alexandre Messa Silva Bernardo Kosacoff Bruno César P. O. de Araújo Daniel Chudnovsky Diana Suárez Eduardo Baumgratz Viotti Eduardo Gonçalves Eugenia Orlicki Fernanda De Negri Fernando Freitas Fernando Peirano Guillermo Anilló Gustavo Lugones João Alberto De Negri Mauro Borges Lemos Rogério Dias de Araújo Victor Prochnik Wilson Suzigan TECHNOLOGICAL INNOVATION IN BRAZILIAN AND ARGENTINE FIRMS Mapping and comparing economies are perhaps the most important – yet difficult – tasks to be accomplished by researchers all over the world. For that reason, this book released by the Institute for Applied Economic Research (IPEA) is unique. For the first time in Brazil and Argentina a top- rate group of thinkers discuss some relevant economic issues focused on innovation and growth. It is particularly stimulating to see an arc of topics addressed at a variety of levels and from a different research perspectives. Brazil and Argentina remain strong competitors in global markets in standardized agricultural and industrial goods. However the data show also that a small, but important group of Brazilian companies is participating in international market via exports of medium and high-technology goods. This cluster of highly competitive Brazilian firms generates growth positive spillovers in terms of wage and productivity. Contrary to expectations in Brazil of a a regressive specialization in terms of exports products following liberalization, the new competitive environment in Brazil is unleashing new business perspectives associated with innovation. This process in Brazil is different from the experiences of firms in Argentina. The ability of the Brazilian industrial elite to compete successfully in the global economy is rooted in their improved innovative capacity. In response to international and domestic conditions, Brazilian and Argentinean firms have reacted, changing their business strategies and also their attitudes towards technology, innovation and employment. These thought-provoking essays illustrate the potential of international comparisons to advance our understanding of the way countries react to economic changes and the deep challenges the two biggest south-american economies have to face. This impressive book will be useful to anyone who cares about what emerging economies will look like in the years ahead. Glauco Arbix Professor, University of São Paulo General Coordinator, Observatory for Innovation and Competitiveness (Institute of Advanced Studies – USP)