Nanotechnology and Microelectronics: The Science, Trends and Global Diffusion

This chapter was culled from Nanotechnology and Microelectronics – that won 2010 IGI Global “Book of the Year” Award.

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For many centuries, the gross world product was flat. But as technology penetrated many economies, over time, the world economy has expanded. Technology will continue to shape the future of commerce, industry and culture with likes of nanotechnology and microelectronics directly or indirectly playing major roles in redesigning the global economic structures. These technologies will drive other industries and will be central to a new international economy where technology capability will determine national competitiveness. Technology-intensive firms will emerge and new innovations will evolve a new dawn in wealth creation. Nations that create or adopt and then diffuse these technologies will profit. Those that fail to use technology as a means to compete internationally will find it difficult to progress economically. This chapter provides insights on global technology diffusion, the drivers and impacts with specific focus on nanotechnology and microelectronics. It also discusses the science of these technologies along with the trends, realities and possibilities, and the barriers which must be overcome for higher global penetration rates.



Introduction- The Global Technology Diffusion

Within the last two centuries, technology has emerged as a key determinant of sustainable growth and poverty reduction. It has become central to many modern developments across the globe and the most important competitive factor in the international economy. Before technology began to drive business operations and processes, global economic growth was flat for centuries and the world did not experience substantial progress in productivity. In other words, generations that lived more than three centuries apart might not have experienced substantial changes in their per capita incomes. But with the evolution of technological advancements shaping global commerce and industry, the world is experiencing new dimensions in wealth creation and productivity. Technology drives the modern world and national competitiveness is anchored on technological strength and innovation which encompasses the social and economic fabric of any economy (Chinn, 2006). It is the major factor that separates the rate and level of incomes between developing and developed nations.



Furthermore, the classification of nations into different categories of developments, advanced, emerging, and developing nations, indirectly translates into their different stages of technology capabilities.  The state of global technology diffusion shows that developed nations continue to create the bulk of the new knowledge while developing countries depend on adoption and adaptation for technological progress as the latter lack inventive capacity (World Bank, 2008a). Nations have different abilities to process technological inputs, even as they have many ways of developing technological competence. For the developing nations, trade and importation of foreign technology goods creates local awareness and brings exposure to new technology (IMF, 2006). Most especially, their skilled diasporas contribute immensely in technology adoption and diffusion.  Also, when multinational corporations (MNCs) invest locally through FDI, they bring knowledge of vital technologies and international markets. According to World Bank (2008a), the diasporas  population is an important resource for their home country—a “brain bank”—that contribute to technology transfers by strengthening trade and investment links with advanced economies, providing access to technology and capital which contributes to domestic entrepreneurship and investment. They also provide technology and marketing know-how, facilitate FDI, and expand banking and other financial services in their home economies.



Historically, not many successful technologies have been transferred across the globe, provided technology transfer is not said to have occurred when an adopting nation imports technology products from innovating ones. Such a narrow context may erroneously imply that many developing nations have adopted steam engine by merely importing trains from developed economies. Technology transfer involves imparting knowledge, skills, capabilities and techniques which are involved in the whole production cycle. Where technology has been effectively transferred, changes in the production system and its compatibility with system needs, institutional framework, skills, financial capacity, and support of endogenous capacity with appreciation of the natural environment of the recipient country are visible (Dabic, 2008). For the adopting nations of technology, the prospects for progress will involve innovation system through their institutions, citizens, universities and research institutions (World Bank, 2009). Adapting existing technologies to meet local needs will be important and technology penetration rate can accelerate globally if low-income nations modernize their educational and trainings structures for efficiency and accountability (Hassan, 2007). This modernization is vital as sustainability depends on the development of knowledge citizens to lead the efforts for acceleration of adoption and adaptation stages. Efficient and new models of education designed collaborations between schools and firms are urgently needed while also allowing market to be the driver of technological improvements.



From the World Bank Knowledge Economy Index (KEI), there is a positive correlation between education, technology, innovation and GDP per capita of nations (World Bank, 2008b). Nations with high KEI show higher competencies in technological advancements while those with very low KEI are mainly non-innovating nations. These latter nations must depend on adoption and adaptation for technological growth and advancement since they lack the capacity to create new knowledge owing to poor facilities, small economies (lacking large scale advantage for funding) and human capital. These problems point out the fact that radical steps must be taken by developing nations if they expect a convergence in technology advancement between them and the developed economies. Their rates of technological advancements could be faster than high-income nations since they have lots of rooms to grow but convergence of technology penetration rates with advanced economies will require major policy changes from them. From the World Economic Forum (WEF, 2009a & 2009b) reports, technology innovation correlate positively with income levels; the more nations advance in technology creation and penetration, the more the incomes levels in those nations. This can also explain why emerging technologies like nanotechnology and genetics are usually associated with high-income nations. Capacity to sustain the diffusion of these emerging technologies is always positively correlated with quality tertiary technical education in the respective areas (Golding, 2006). Globalization with offering of more market access and FDI will continue to help developing nations; however, the most important indicator will be the human capital development. Retaining the best and brightest technical manpower in those nations will boost the prospects of catching up with the developed countries (Ekekwe, 2009a).



Unfortunately, the manpower is not the only problem that has stalled the transfer of emerging technologies to developing economies. Besides technological illiteracy and low skill level, the regulatory and political environments, lack of economic transparency, low intellectual property rights (IPRs), and infrastructural development hinder innovation and entrepreneurship. Others factors include corruption, civil strife, macroeconomic turmoil and state monopoly of industrial sectors (World Bank, 2008a). These explain why old and matured technologies like telephone (landline), water supplies, and electricity have not properly diffused in these nations despite decades of their existence. In many developing nations, software piracy is unchecked and remains the major barrier to the innovation and growth of the local software industry. A sustainable technology transfer will not take place if there is no holistic absorption capacity in the transfer cycle. Mapping technology shows that penetration rate positively correlates with strong national IPRs. This is why governments and other institutions must work as partners to stimulate and nurture appropriate transfer environment. Opportunities are emerging from globalization and market-forces based economic models are being adopted by developing nations. These changes can facilitate the penetration of new technologies that enable better business processes, tools and services. However, according to World Bank (2008a), the reality is that these new technologies require the infrastructure of the matured ones to grow and be sustainable. In addition, weak relationship between R&D and the business communities, and absence of strong links to diffuse even local technologies (products of local universities and industrial R&D) undermine technology advancement and progress. It is an effect centered on poor foundation showing that while exposure is important, what matters most is the absorptive capability of these nations (World Bank, 2008a).



Specifically, for nanotechnology and microelectronics, the prospect of deep penetration in developing nation is very low. The key factors being the poor state of the basic amenities, human capital and huge capital investment needed for these technologies. The challenge is getting these technologies into the nation first since naturally technology spread takes long time to even appear in developing nations. The next problem will be how to effect the penetration when it has been brought into the country, including penetration within firms since they adopt at varying rates. Electricity and clean water technologies remain major challenges in developing nations despite many years of their existence. While few of the cities enjoy these technologies sparingly, majority of the citizens are yet to use them. But technology process is correlated with its penetration in each economy. For technologies discovered between 1950 and 1975, only a quarter of the developing nations (upper-middle-income nations) that have reached at least 5% penetration level have gotten up to 25%; the low-income ones fair very badly (World Bank, 2008a). Nonetheless, nanotechnology and microelectronics are not just products, but technologies whose products are penetrating global markets. Mobile phones, Internet, water systems, and electricity use microelectronics products, at least, since nanotechnology is still evolving. Estimate of the penetration rate of microelectronics will be better evaluated at the creative side of the technology; in other words, the capacities of the developing nations to develop and mass produce microelectronics products, instead of just consuming the products. This will involve having capacity in microelectronics design and fabrication. So while mobile phones could be penetrating rapidly in a developing nation like Nigeria, the microelectronic technology is not as the nation does not have a single modern operational cleanroom (Ekekwe and Ekenedu, 2007). These interrelationships show why the developed nations where technology is usually imported or acquired have a duty to facilitate global diffusion by structuring their licensing fees and technical know-how to enable easier acquisition by low-income nations. The developed nations will benefit in the long-run if more diffusion translates to more needs for their products; a symbiotic partnership in a globalized world.



Knowledge and Innovation in International Economy

Knowledge rules the world. This is evident as many new firms operate on the capacity of knowledge without the luxury of massive natural resources. While natural resources are still very important for survival and growth of some business models, the world is experiencing a shift where knowledge is a major component of organizational factors of production. Today, at both national and organizational levels, progress in knowledge creation, acquisition and processing is an indication of the state of global competitiveness.  Figure 1 shows the World Bank (2008b) Knowledge Economy Index (KEI) for three nations: Ghana, USA and Brazil representing a developing nation (Ghana), a developed nation (USA) and an emerging nation (Brazil). Also included are Western Europe and Africa. The figure shows a relationship between the level of innovation and education and the state of national KEI. To move from a low KEI, a nation must have the capacity to advance its educational program and innovation culture. Education not only helps in developing new knowledge, it also helps in diffusing technologies and established knowledge. That is why innovation and excellent education are closely related.



Figure 1: KEI of Ghana, Brazil, Western Europe, Africa and USA (most recent data compared with 1995: Source, World Bank)



Further analyses using Figure 2 show specific indicators that contribute to the factors presented in Figure 1. In these indicators that include publications, patents, and university-company research collaboration, USA leads Brazil and Brazil leads Ghana in average. These data show that education plays major roles in advancing national KEI and development. It is a very vital component for innovation systems in any economy. It is also a source for creating and assimilating new knowledge. For nations that want to successfully adopt a new technology, education must play important role in this international economy. It offers organic succession pathways that will sustain any national progress in this area. For microelectronics and nanotechnology, without sound education, the sustainability of any of the transfer cycles will not be possible.



Figure 2: Indicators of KEI for three nations: USA, Ghana and Brazil [Source: World Bank]



From the KEI, it is obvious that the developing nations have uphill tasks to equilibrate the global technology know-how disparity. The divide is huge and it will require substantial efforts to narrow. In nanotechnology and microelectronics, these nations do not have policies or instruments that can stimulate domestic innovation capability. So even when efforts are made to adopt emerging technologies through various means, lack of requisite skills will always affect adaptation process. That education content in KEI that improves national skill level is still lacking. Also, without innovation, improvements will stall and the values derived over time will be suboptimal. Infrastructural problems and out-modeled educational system means that developing nations will continue to lack the capacity to drive innovations in pushing the frontiers of science and technology. There is a tendency they will remain outside the horizon of creative nanotechnology and microelectronics for a long time. By not contributing in the innovation chain and creating knowledge, they will miss the wealth that technology enables at the upstream level, and remain perpetual participants at the downstream level. Unfortunately, the downstream level does not generate lots of wealth and that is where majority of developing nations practice technology. This sector means supporting, installing, configuring and maintaining technology with no sign of adding value or creating new knowledge in the process.  This is analogous to the petroleum sector where the multinational firms practice in the upstream sector while the local firms dominate the downstream sector, basically, distribution and sales of crude oil products. However, the petroleum business wealth is localized at the upstream sector that requires continuous innovation and knowledge creation which these poor economies lack.


Table 1 shows comparative economic indices and factors for certain regions, categories and selected nations. For each of these regions and nations, there is a positive correlation between indices like Technology Readiness Index, Human Development Index, Networked Readiness Index, and Global Competiveness to Global Innovation Index. In other words, as a nation focuses on improving one of the indices, it will suddenly improve other ones too.




Table 1: Comparative economic indices and factors for selected regions and nations



$bn, 2007

GDP, % annual growth 2002-07 Purchasing Power

GDP,% of total, 2007

Purchasing Power

$ per head, 2007

Int’l Trade

Export of goods & services, % of tot, 2007

Int’l Trade

Current acct bal, $bn, 2007

World 54,312 4.6 100.0 9,730
Advanced Economies 39,131 2.7 56.4 35,780 66.4 -463
G7 30,419 2.4 43.5 37,380 38.4 -544
Euro area(15) 12,158 2.0 16.1 32,940 29.5 -30
Asia 5,724 9.0 20.1 3,840 13.2 384
Latin America 3,450 4.8 8.3 9,760 5.1 16
Eastern Europe 3,527 6.9 8.6 11,700 8.0 -45
Middle East 1,387 6.0 3.8 10,350 4.7 275
Africa 1,092 5.9 3.0 2,420 2.5 2
GDP per head, $PPP, 2006 Human Dev. Index Global Competitiveness, 2009 Global Innovation Index Technological Readiness Index Networked Readiness Index
USA 43,970 95.1 #2 #8 #9 #3
Brazil 8,950 80.7 #56 #72 Above #24 #59
Ghana 1,250 53.3 #114 Above #110 Above #24 #103
World 9,250 74.7

Sources: The Economist, 2008; UNDP, 2008; World Economic Forum, 2008; Boston Consulting Group and National Association of Manufacturers, March 2009




The Science of Nanotechnology and Microelectronics

In this section, nanotechnology and microelectronics will be discussed separately. Despite their future prospects of convergence (Roco, 2006), they are still distinct technologies. While nanotechnology is an evolving technology, microelectronics is largely matured. Also, while nanotechnology is usually discussed within the context of its future potentials, the world has witnessed the disruption in industry and commerce enabled by microelectronics. Besides, the economics of microelectronics, micromics, is well understood, the one of nanotechnology, nanomics, is yet to shape properly. In general, they are two very close (converging) technologies, but in policy, science, ethics, risk factors, economics, and growth cycle, they are distinct, at least, now.




Nanotechnology is the science of minuscule molecule (RNCOS, 2006) or manipulation of matter at 1 to 100 nanometers yielding unique characteristics in chemical and biochemical reactions, electronics, physical, magnetic, thermal and optical behavior, mechanical strength and biological properties (Pourrezaei, 2007; Armstrong, 2008).  A nanometer (nm) is one billionth of a meter; the width of an average human hair is about 100,000 nm. The technology is advancing with potentials to radically affect key aspects of human existence. It is an evolving (and potentially) disruptive technology that is transforming industries like electronics, materials and medicine. It has capabilities for low cost, high efficiency and high capacity in tools, industrial processes and products. The technology is not completely proven, still growing and only few nanostructures are at commercial productions. Largely, precision is lacking and controls are difficult and in most cases, some of the concepts are not economically viable with present body of knowledge. It poses environmental and health challenges as many of the materials are toxic, though nanotechnology can be used in combating pollution and other environmental hazards. Besides technical challenges, lack of standardization and public perception of its products bring a level of uncertainly about this technology (RNCOS, 2006).



Despite the present challenges, nanotechnology has enormous prospects. Many scholars expect it to be significant as the steam engine, the transistor, and the Internet in terms of societal impacts (Michelson, 2006). It is already used in automobile, healthcare, computers, and genetics, though not at a significant scale. It many cases, it offers only marginal innovation to existing products and processes. United States, Europe and Asia are the world’s largest markets, dominating trade and collectively accounting for more than 80% of R&D; the BRIC nations (Brazil, Russia, India and China) have recently increased their nano-investments as they design their future developments around technology capabilities. The potential global wealth this technology will create besides possibilities that it can help provide cures for decade-old diseases makes it exciting. A nano-economy driven by nanotechnology could potentially exceed the micro-economy presently anchored on the powers of microelectronics.  It is estimated to become a $1 trillion global market in 2015 (RNCOS, 2006). Energy, textiles and life sciences are the leading sectors transitioning from labs to markets. Low cost, high utility and demand for nanotechnology products will drive the nano-revolution which will help advance genetics, information technology, biotechnology and robotics.



The Science

Nanotechnology is not new; research has been done at nanoscale for many decades. What has enabled the sudden transformation in the scale and mass of nanotechnology focused research has emerged from the following factors (Maclurcan, 2005):


  • Availability of modern tools like scanning probe microscopy, quantum mechanical computer simulation, soft x-ray lithography and synthesis technique for experimentation at nanoscale level
  • Sudden recognition of nanotechnology as an emerging field which creates new levels of multidisciplinary collaboration and cross-fertilization amongst the sciences
  • Desire to manufacture with ultimate precision on the atomic scale in a ‘bottom-up’ manner



The technology refers to a wide range of technologies that measure, manipulate, or incorporate materials and/or features with at least one dimension between approximately 1 and 100 nanometers (nm). From American Society for Testing and Materials (ASTM, 2006), such applications exploit the properties, distinct from individual atoms or bulk/macroscopic systems, of nanoscale components resulting from quantum effects and high surface areas; the laws of quantum physics supersede those of traditional and classical Newtonian physics. At nanoscale, quantum mechanical effects dominate material properties and with increased surface areas, electrical, chemical, conducting, optical and others properties of materials change. The technology offers the closest means to manipulate matter and life whose building blocks are at nanoscale. There are five phases of nanotechnology developments that have emerged (Saxton, 2007; Michelson et al, 2008);


  • First generation (2000-2005) of “passive nanostructures” that incorporate nanoscale materials into coatings, aerosols, and colloids
  • Second generation (2005-2010) of “active nanostructures” that are biologically or electronically dynamic
  • Third generation (2010-2015) of “systems of nanosystems” that more fully integrate these materials into more complex organizational and manufacturing systems
  • Fourth generation (2015-Beyond) of “molecular nanosystems” that lead to atomic and molecular-level assembly. This stage captures the intelligent design of molecular and atomic devices, leading to “unprecedented understanding and control over the basic building blocks of all natural and man-made things.”(Saxton, 2007).
  • Fifth generation is the stage of singularity where the growth rate will seem to be infinite with production of products which today will seem like ‘science-fiction’.



Present research works concentrate at the 1st and 2nd generations, though some minor works are taking place at the 3rd and 4th generation systems. This industry is multidisciplinary involving physics, chemistry, biology, computer science and engineering. Some of the major products/components of nanotechnology include nanomaterials, polymer nanocomposites, nanoparticles, and nanoclays. Others are nanotubes, inorganic nanoporous and microporous adsorbents, nanomagnetic materials and devices, nanocatalysts, nanofilms, nanoscale devices and molecular modeling, nanophotonic devices, advanced ceramic powders and nano ceramic powders, quantum dots, nanoelectronics, and nanosensors (RNCOS, 2006). It presently or will in future find applications in areas like automotive and transportation, life sciences, medicine and healthcare, instrumentation and tools, consumer products, photonics, energy, computers and communication, food and beverage packaging, aerospace and defense, environment and water, construction and structural materials, security and textiles, industrial process control and electronics (RNCOS, 2006; Pourrezaei,2007). Many decade-old problems could be solved by nanotechnology if the enormous potentials are effectively harnessed and commercialized. In developing and emerging nations, it offers prospects to provide low-cost energy sources, control of HIV/AIDS transmission, water purification, food security and cheap housing.



For nanotechnology to shape global economic structures, the science must be translated into price-competitive and reliable products with market demand. Nanomanufacturing, the bridge between nanoscience and nanotechnology products must develop and advance. This may require the development of new technologies, tools, instruments, measurement science, and standards to enable safe, effective, and affordable commercial-scale production of nanotechnology products (Sargent Jr., 2009). A well controlled, low-cost, knowledge-intensive and minimal-labor component is required for mass production of the nanosystems.



The Trends

In the United States, many states are anchoring their technology-based economic development on nanotechnology. China is also investing heavily in this technology.  The trend is anchored on the tripod of government, universities and industry partnerships towards developing IP (intellectual property) with commercial values (Armstrong, 2008; USDO, 2006).



Nanotechnology is maturing with many organizations focusing on areas with potential market impacts. There are more than 800 nano-related products in the market with $50 billion revenue (globally) in 2006 and there is potential for the industry to become a multi-trillion business in few years (Michelson, 2006). The next decade will usher the period for harvesting some of the basic works as application concepts are developed. Market focus and cost efficiency will dominate the next phase and nanoproducts and nano-driven industrial processes must demonstrate market viability. This is expected as investors begin to plan exit strategies and the global economy recovers from recession.  As the technology diffuses globally, there is need for effective oversight mechanisms for environment and public health issues, internationally coordinated risk research strategies, expanded public awareness to change some negative perceptions (Michelson, 2008).  Because public attitude to nanoproducts could affect their market acceptability, R&D environment, and regulation (Sargent Jr., 2009), public education is very important. A number of potential challenges to the continuous progress in nanotechnology have been identified and they include Armstrong (2008):



  • The industry is capital intensive and not many universities and firms can participate in the R&D
  • The venture funds is still low due to the uncertainty of the technology
  • Many nanoproducts are sub-standards with poor quality and replicability. The industry standardization process is poor and effective techniques to evaluate products safety, environmental and health issues are yet to be developed.
  • Public perception and lack of understanding of the technology continue to undermine efforts for allocating investment and R&D funds
  • The technology requires highly skilled workforce and support services which are not readily available, especially in the developing and emerging nations
  • There are many legal uncertainties with un-standardized regulatory guidelines. Besides, the overlapping IPR poses a challenge along with increasing advocacies for customer protection (ASECO, 2008)



The diverse applications of nanotechnology pose difficult challenges and hence it is implicated in broad ethical issues that range from medicine to information management. This broadness calls for case-by-case ethical evaluation in the areas of research, development and dissemination (Michelson, 2008). This is necessary since there is the possibility of using the same nanotechnology innovation for both good and bad causes; so, application-regulation is more important than science-regulation. An engineer that manipulates molecule for HIV/AIDS transmission prevention could use the same raw materials to build bioweapon. How these two activities are regulated must be different as regulating the science itself will not be sufficient. While the former is just, humane, sustainable, and necessary the latter is not.



Going forward, nanotechnology could be a displacing technology; however, majority of it will be a complementary one. From UNESCO-sponsored study in 1996, “nanotechnology will provide the foundation of all technologies in the new century” (Mooney, 1999; Maclurcan, 2005) and it will have huge societal impacts. The expected magnitude of the impacts is the major reason why the regulation of the technology and its applications must ensure safety, reliability and responsibility while enabling market success. These regulations must be supported by scientific studies, instead of being based on apocalyptic imaginations that derail the science and harm efforts to develop ethical guidelines, health, safety or environmental risks assessments (Nanotechnology Now, 2009).






The remarkable success of information and telecommunication technology within the last few decades has been facilitated by the phenomenal growth of the microelectronics technology (Ekekwe, 2007). While nanotechnology has future prospects, microelectronics has already transformed global competition and commerce. It offers strategic advantages to firms, institutions and nations through its capacity to develop products and services cheaply and efficiently. It is the engine that drives present global commerce and industry.



The world has experienced many new dimensions in knowledge acquisition, creation, dissemination and usage (Radwan, 2009) courtesy of this technology. The advancement of Internet and digital photography could all be linked to better performance from microchips. When microelectronics technology advances, a dawn emerges in global economy in speed, efficiency and capacity (Ekekwe, 2007).



Microelectronics is considered a very revolutionary technology considering the disruptions it has brought to the dynamics of the global economy via its different applications since its invention by Jack Kilby in the late 1950s (see Box 1). Of the gross world product (GWP), estimated (2007) at about $55 trillion (currency) (The Economist, 2008), microelectronics contributes more than 10%. Microelectronics is very pivotal to many emerging industries in the 21st century with a central position in the global economy (Sicard, 2006). Because Internet, medicine, entertainment and many other industries cannot substantially advance without this technology, it has a vantage position in engineering education in many developed nations. These nations invest heavily in microelectronics education as in the United States, Canada and Western Europe where the MOSIS, CMC and Europractice programs respectively enable students to fabricate and test their integrated circuits for full cycle design and learning experience on integrated circuits.  On the other hand, developing nations increasingly lag behind in adopting and diffusing this technology in their economies owing to many factors, which include human capital and infrastructure. The same problems that are hindering the global penetration of nanotechnology affect microelectronics. Absence of quality technical education has contributed to stall the transfer, diffusion and development of microelectronics in both the emerging and developing economies. This is why the technology despite a long history of success has not penetrated globally. Bottom-up creative technology diffusion model anchored on developing nation’s tertiary institutions, and small and medium-scale enterprises (SMEs) is required for creative and sustainable microelectronic programs in these nations.



Box 1: The Invention of the Transistor and Integrated Circuit

Throughout the first half of the twentieth century, radio valves played an important role within electronic products. In 1947, however, scientists at the AT&T Bell Laboratories developed a device that would revolutionize the whole economy: the transistor.

The first demonstration of the transistor was carried by William Shockley, John Bardeen and Walter Brattain, and the three would later receive the Physics Nobel Prize.

One of the most important discoveries related to the transistor was the fact that some materials were neither electrical conductors nor electrical resistors, they were in fact semiconductors. Silicon, for instance, is a semiconductor and William Shockley figured that he could change the properties of semiconductors by “doping” it with certain substances.

The interesting fact about the invention of the transistor is that AT&T failed to transform it into innovation. The invention was obviously patented, but the organization was not able to find promptly an application for the new device. They did an outstanding job with the invention, but failed to commercialize it. Precisely for that reason in 1952 AT&T decided to license out the transistor. For $ 25,000 companies like Sony and IBM acquired a technology that would produce billions of revenues in the coming years.

With the successful integration of circuit elements such as transistor, resistors and capacitors onto a die by Jack Kilby and Robert Noyce, the world of microelectronics was born.

Adapted from D. Scocco, 2006




Just as there are public anxieties in some quarters on potential job disruption by nanotechnology, many expressed similar feelings (though, the scale is different) on microelectronics. As the technology was evolving, there was fear that it could cause major unemployment crises by enabling industrial automation. Fortunately, microelectronics has actually contributed to global economic growth and enabled a generation of new class of workers, knowledge workers. But it is not nanotechnology. Nanotechnology has the capacity to transform the traditional global raw materials supply industry which benefits many developing nations. Materials like copper, rubber and cotton that are shipped from low-income nations as major foreign earners to advanced ones could be substituted by alternatives created in the labs. This potential massive disruption in GDPs of these poor nations and resultant job displacements could be catastrophic, both politically and economically. Microelectronics offers an example to understand what the potential nano-driven economy could look like; but in many cases, it will not give an accurate picture if the potentials of nanotechnology are fully harnessed. A model for the diffusion of this technology in developing nations will involve a sound technical education program, multi-chip project, microelectronics academic network, etc (Ekekwe, 2009a).




The Science

While nanotechnology is an evolving technology, microelectronics has relatively matured.  Microelectronics is a group of technologies that integrate multiple devices into a small physical area (FMNT, 2009). The dimension is about 1000 larger than nanotechnology dimension; micrometer vs. nanometer. Usually, these devices are made from semiconductors like silicon and germanium using lithography, a process that involves the transfer of design patterns unto a silicon wafer (Ekekwe, 2009b). There are accompanying processes which include etching, oxidation, diffusion, etc. Several components are available in microelectronic scale such as transistors, capacitors, inductors, resistors, diodes, insulators and conductors. The microelectronics can be divided to its subfields which in turn are connected to other micro related fields. These subfields are micro electromechanical systems (MEMS), nanoelectronics, optoelectronics and single electron devices (FMNT, 2009). Integrated circuits or microchips are typical microelectronic devices, which can be found in computers, mobile phones, medical devices, toys and automobiles. There is a high level of convergence between nanotechnology and microelectronics. The major difference lies in the size of the materials; nonetheless, the techniques are very different. Complementary metal oxide semiconductor (CMOS) transistor is the most common transistor used in the industry owing to its ease of integration and low static power dissipation (Ekekwe and Etienne-Cummings, 2006). Bipolar junction transistor is another popular version. With the sizes of CMOS transistor in the nanometer range, the behaviors of the transistors are radically affected by parasitic noise and power dissipation. These problems pose potential challenges to the continuous progress of CMOS technology and microelectronics industry in general. The survivability of Moore’s Law, (after Gordon Moore, co-founder of Intel Corp) which states that the numbers of transistors in a semiconductor die double every 18 to 24 months, is presently challenged if engineers cannot downscale the transistor size any further efficiently. This scaling has been the driver that has enabled microelectronics products to improve in speed, capacity and cost-efficiency. Many efforts have been geared to overcome the problems faced in the industry as transistors scale into the deep nanometer. They include improving the structure of the metals and polysilicon materials used in making the devices, more enhanced doping profile, new materials to keep the industry alive and well into the future (Ekekwe, 2006).





The Moore’s law has been the gauge on the advancement of microelectronics (Ekekwe, 2009c). The ability to sustain the law for more than five decades shows the level of innovation in the industry. IBM and the Common Platform (a collaboration between IBM, Chartered Semiconductor Manufacturing, and Samsung Electronics developed to implement a common process technology across all three companies’ semiconductor manufacturing facilities) already has a 32 nanometer (32 nm) process available. The 32 nm process is the next step after the 45 nm process in CMOS manufacturing and fabrication. Firms like Intel and AMD, major microprocessor vendors, are already working on the 32 nm process for logic. However, as transistors are scaled into deep nanometer scale, they will eventually reach the limits of miniaturization at atomic levels. Around that time, microprocessors will contain about tens of billions of transistors. Intel Corp expects the end to come before 2020 with 16 nm CMOS manufacturing process and 5 nm gates due to quantum tunneling (Ekekwe, 2006). Lawrence Krauss (2004) expects an ultimate limit at about 600 years based on rigorous estimation of universal limits of computation (Krauss, 2004).



Despite all these predictions and discussions, it is important to note the level of resilience in microelectronics and technology in general with a deep history of overcoming obstacles.  The extremely futurists expect the law to ultimately lead to a technological singularity, a period where progress in technology occurs almost instantly (Kurzweil, 2005)), however, International Technology Roadmap for Semiconductors, with objective to ensure advancements in the performance of integrated circuits and remove roadblocks to the continuation of Moore’s Law is not that optimistic.  Figure 3 shows the industry trend, measured by the size of lithography, over the years. The size of lithography is expected to reach 22 nm in 2013 and that is deep nanometer scale with all the associated quantum mechanical effects.



Figure 3: Technology scaling with year (source: Sicard, 2009)





It is evident that the truism that the ‘only constant is change’ applies to innovation because innovation is change with higher value. Predicting the future of science based on the understanding of the present science makes no sense since inventions of tomorrow will unlock the realities of after-tomorrows. The key aspect of innovation is meeting not just the needs and expectations of the customers or the marketplace, but exceeding their perfections. Nanotechnology and microelectronics will remain central in creating innovative products and services and possibly herald the next technology that will come after them. Developing nations have opportunities to learn and it is imperative they do so quickly to avoid devastating impacts technologies and innovations will bring. The Irish story on innovation is a good case study (Box 2).





Nanotechnology and Microelectronics Global Diffusion Trajectory


The U.S. National Nanotechnology Initiative defines nanotechnology as “the science, engineering, and technology related to the understanding and control of matter at the length scale of approximately 1 to 100 nanometers”. However, “nanotechnology is not merely working with matter at the nanoscale, but also research and development of materials, devices, and systems that have novel properties and functions due to their nanoscale dimensions or components”. A joint report by the British Royal Society and the Royal Academy of Engineering similarly defined nanotechnology as “the design, characterization, production, and application of structures, devices and systems by controlling shape and size at nanometer scale” (Sargent Jr, 2009). Microelectronics, on the other hand, is related to the study and manufacture, or microfabrication, of electronic components which are very small (usually micrometer-scale or smaller, but not always).  Both technologies are converging as microelectronics transitions into nanometer regime. Patents, academic journals and other metrics for ascertaining technology innovation indicate that advanced nations dominate these technologies and the global diffusion trajectory will flow from them to other parts of the world.



A global technological progress—improvements in the techniques (including firm organization) by which goods and services are produced, marketed, and brought to market—has been at the heart of human progress and development (World Bank, 2008a).  This is pivotal to stimulating income growth and poverty reduction and shaping the social and economic structures of nations for many decades. Over the last few decades, many technologies have evolved and disrupted the global business and economic structures. Especially, the Internet has affected many traditional industries and introduced new dimensions to commerce. Firms that have knowledge as its factor of production continue to challenge established ones. In the midst of all these revolutions, microelectronics has been at the center, enabling these disruptions through its efficiency, speed or capacity. Nanotechnology is new, but promises enormous potentials that will transform all fields of human endeavors. But these technologies are skill-intensive and their global diffusion will follow a peculiar pattern, from developed nations that invent to developing ones that adopt. Owing to the high cost in these technologies, government will have major roles. From facilitating economic environments that will enable the technologies if adopted to thrive to inducing foreign firms with opportunities to exploit the technologies with huge profits, it does not seem that firms can accelerate their penetrations without efforts of governments. Especially in Africa where instability is common, it will be very challenging for firms to invest in the scale associated with these technologies (WEF, 2009a). This calls for government participation in the process of technology diffusion, especially in nanotechnology where R&D is very high with uncertainties in return. Possible government subsidies of nanotechnology economic development will lower research costs, increase industry participation, stimulate technology transfer, and assist firms that commercialize nanotechnology discoveries (Armstrong, 2008).



For nanotechnology and microelectronics to be adopted into developing and emerging economies, these nations must develop national level strategies. The focus will be to assist firms and universities acquire tools and resources needed for R&D owing to the capital-intensive nature of the technology. This will be followed in parallel with massive investments in human resources and skills to facilitate the adopting process. At both secondary and tertiary education levels, developing nations have a challenge to upgrade the quality of their science and technology programs. A strategy that coordinates both educational levels is important as the secondary students must remain organic feeders to the tertiary institutions. Also, there should be more levels of collaborations among the various institutions. Efforts must be geared to attract multi-national corporations (MNCs) through tax holidays and other means to invest and assist in knowledge transfer to the local industry.



A strategy similar to the Pennsylvanian state (USA) Ben Franklin Technology Development Authority University Research Funding designed to promote stronger synergy between university-based research and development and the transfer of technology as it relates to economic and work force development (newPA, 2009) is needed in these nations. The aims which can be customized to individual nations are as follows:



  • Developing and increasing new technologies, escalating technology transfer, and enhancing university-based resources and skills
  • Increasing commercialization of applications and processes through university, industry and government collaboration
  • Forming new spin-off companies that are deriving a significant portion of its commercial activities from the use of technology and/or know-how developed at a  tertiary institution
  • Leveraging of funding by the federal, state and local government, philanthropic foundations,  strategic investors, and industry sponsored research
  • Creating consortia-driven, educational and workforce development programs
  • Developing strategies for financial sustainability



Similar policies developed and adopted by the EU could be used for developing and emerging nations (EU, 2004) in mapping their nanotechnology diffusion. They include the following steps:



  • Increase investment and coordination of R&D to reinforce the industrial exploitation of nanotechnologies whilst maintaining scientific excellence and competition
  • Develop world-class competitive R&D infrastructure (“poles of excellence”) that take into account the needs of both industry and research organizations;
  • Promote the interdisciplinary education and training of research personnel together with a stronger entrepreneurial mindset;
  • Ensure favorable conditions for technology transfer and innovation to ensure that R&D excellence is translated into wealth-generating products and processes;
  • Integrate societal considerations into the R&D process at an early stage
  • Address any potential public health, safety, environmental and consumer risks upfront by generating the data needed for risk assessment, integrating risk assessment into every step of the life cycle of nanotechnology-based products, and adapting existing methodologies and, as necessary, developing novel ones
  • Complement the above actions with appropriate cooperation and initiatives at international level (EU, 2004).



Also, initiative similar to the United States National Science Foundation will be very useful in developing nations. Efforts must gear towards funding technology centers and establishing technology clusters across national regions and developing technological entrepreneurship besides eliminating the barriers to technology penetration (See Table 2). Major assessment is necessary in developing nations because these are high investment technologies. With limited resources, regional cooperation between universities, firms, national laboratories for resources and information may prove vital. The same calls for provision of international access to tools, manpower and infrastructure to poor nations at this stage of the technology cycle.



Many factors will continue to affect the trend of these technologies as well as their location and localization. Presence of centers of excellence, good universities, technology clusters, government labs, infrastructure, and skilled workers will shape the trajectories of diffusions. The more nations or regions have these capabilities, the easier for them to transfer the technologies. Advancements bring complexities, especially in microelectronics, and firms require pool of highly trained skill workers to remain competitive. Also, the design stage, manufacturing systems and validation stage have become complex and expensive.  A modern semiconductor plant exceeds $3 billion in investments and not every firm can afford that during this time of global credit meltdown. So, presence of technology clusters and access to the right technology will continue to influence the diffusion trajectory.



Evolving economic dynamics and the intense competition in the ultra cost-intensive and –sensitive industries, has changed the ways many semiconductor firms operate. While few are still integrated device manufactures (IDMs), the business model of total in-house design and manufacturing for a typical product, have resorted to new models, focusing on distinct technological markets (Scott, 2007). Some of these firms operate under the following categories (Scott, 2007):



  • Companies devoted solely to developing Semiconductor Intellectual Property (SIP), known as the ‘Chipless’ business model
  • Companies that concentrate only on product design, referred to as the ‘Fabless’  business model
  • Companies that offer contract semiconductor manufacturing to other companies, known as the ‘Foundry’ business model
  • Companies that perform testing and packaging for other companies on a contract basis.



These new models offer the optimal paradigm for diffusion as barriers to entry is radically reduced when compared to when firms have to be IDMs. As firms focus on specific markets/areas where they have competence, the industry is emerging with higher level of coopetition, collaboration and cooperation. This evolving paradigm will favor developing and emerging nations that can deploy their scarce resources to develop and nurture a segment of the industry. Their universities and firms, who can share tools and equipment, could concentrate on the testing and packing, ‘chipless’, and ‘fabless’ models that seem to require lower cost-investment when compared with ‘foundry’ and IDM models. As they progress, they will incorporate other areas and possibly this makes it easier for them to connect into the network of semiconductor or nanotechnology knowledge creation. Unfortunately, the realities are that poor financial structures, unstable economic regime, unskilled human resources, social instability, inadequate and basic amenities may not enable them to participate in any of the models. So, the divide continues as they remain importers and consumers of these technologies, instead of partners in developing them. Without breaking into the value chain, especially at the upstream sector of the technologies where knowledge is created, developing nations will have difficulties to advance economically. The future of global economy is rooted on knowledge with microelectronics and nanotechnology central to exploiting that knowledge.




Realties and Possibilities with Nanotechnology and Microelectronics

Since technology and technological progress are central to economic and social well-being, the creation and diffusion of goods and services are critical drivers of economic growth, rising incomes, social progress, and medical progress (World Bank, 2008a). Developing nations lack behind in both the technology creation and dissemination. Their pace of technology adoption is low and the technology landscape remains poor. Though over the years, FDI, trade, and exposure to international technology has improved the penetration rate, the gap compared with high-income nations is still very large. The political climate, corruption, stifling business environment, poor infrastructures, lack of innovation culture, poor economy regime,  along with low technology literacy are major challenges which must be overcome. It is well established that one of the key factors to technology adoption and transfer is knowledge barriers. While the world discussed digital-divide in the information technology era, the future will potentially will be nano-divide. The challenge is that nano will continue to enable economic concentration in developed nations (holders of core patents with economic rights) and developing ones will find it increasingly difficult to transition from their present states. Besides, with lack of innovation in developing nations, the disruption of global economic structures can harm the developing nation since they lack the resilience and fluidity to react to changes. The prospect of nano-weapons could be a concern in the hands of these unstable developing countries as they can self-destruct or destroy neighbors. Terrorism could escalate to a level not imagined, not just in the developed world, but globally as nanotechnology will make it easy to terrorize with devastating global impacts. The world could be visited with arms race and nuclear anti-proliferation could be relegated with anti- nano (weapon)-proliferation. If nanotechnology products could affect trade patterns with replacements of raw materials, the developing world would be the most affected as poverty could increase. Replacing the exports will increase global unemployment and that can pose global insecurity. The world within the last few centuries have depended on the raw materials of developing nations to sustain civilization, if nanotechnology can replace the needs of those materials, monumental upheavals could result in these countries with worthless cotton, copper, rubber, among others.



Nanotechnology must not be viewed as a fix to all the technology problems in the developing world; in other words, it must not be diffused without examining alternatives which may be more appropriate to the particular nation. Cautious and systematic approach is needed as these nations develop plans for the adoption of any aspect of nanotechnology. Without this strategy, the technology may not be sustainable as previous efforts have shown. An assessment of national activity by HDI (Human Development Index) groupings shows that the strength of developing country engagement with nanotechnology correlates positively with HDI rank (Maclurcan, 2005). The same would be expected in the Knowledge Economy Index; innovation either in process or products correlates with economic regime. As developing nations improve their KEI, there is expectation that technology transfer capacity will improve.



While many policies have been centered at national level, some developing nations may require protection from predatory firms which may take advantage of them. It may be necessary to implement international policy that will guide nanotechnology transfer so as to protect poor vulnerable nations without expertise to understand the risk aspects of the technology. It is almost certain that nanotechnology will exacerbate the economic divide between the advanced and poor nations; nonetheless, this policy will protect them from nano-waste and –dump. EU and United States dominate major policies in nanotechnology and those policies will likely evolve to become international standards. Broader discussion will arguably result to standards that will be universal, equitable and accommodative of the views of other nations. Now is the time to implement universal policies towards a reliable, sustainable and profitable nanotechnology era for all stakeholders.




Table 2: Potential barriers to implementing emerging technologies in developing countries

(Source: McConnell, 2008)


Barrier Comments
Absorptive capacity



Attitudes and perception





Cultural and community issues




Legal and ethical Issues




Technical issues






Environmental issues



Sustainability issues



Practical issues of working internationally





Health care infrastructures

Inadequate ability to recognize, place value upon, internalize and apply new knowledge


Acceptability, perceived needs based on a needs analysis,

attitudes towards technology, concepts of development and

aid, and focus on the problems to be solved (i.e. being people driven and problem-oriented not kit-driven)


Language, cultural views towards technology, sharing of

resources within the community, appropriateness of a specific technology within a given culture or community, literacy requirements, gender issues and access issues


Privacy, confidentiality, security, malpractice potential,

insurance, jurisdiction, copyright, patents for new technologies and treatments, other intellectual property issues


Access to electricity grid and alternative power supplies, power schedules and reliability, UPS back-ups, ongoing maintenance of computers. Inappropriate access devices and inappropriate Internet technologies including low bandwidth. Insufficient language and cultural adaptation of content and the digital divide


Effects of weather, temperature, humidity and dust on equipment. Security and accessibility of equipment. Isolation, transport issues


Ongoing upgrades of technology, ongoing costs,

issues cost-effectiveness


Corruption, borders and customs in equipment transport,

nationally-imposed barriers to information access or

dissemination or to information privacy, donor-imposed

barriers, time zones and communication issues of working in

remote geographical areas


In health, insufficient means to implement health care and take full advantage of leapfrog ICT technologies, e.g. lack of

treatment facilities, drug delivery systems, inadequate cold

chain facilities for vaccines




Governments and investors (equity and capital funding) will be very important in the growth of nanotechnology (Harper, 2009). But the uncertainties in many areas of nanotechnology mean that funding could be a challenge during a time of global economic meltdown where investors have lost money and government lost revenues. Harper (2009) reports that in the US 19,300 firms received venture funding while only 351 were venture capital-backed IPOs since 2002, and only about 13% of the VC exited. As the 2009 global liquidity crises lessens, funding in 2010 for emerging technologies will be expected to improve and many nanotechnology firms will be ready for IPOs.  The US government stimulus money will also offer source of funding that will help the technology sector in general. Lux Research, a consulting firm, estimates that global nanotechnology venture capital investment in 2007 was $702 million, of which 90% went to U.S. based firms (Sargent Jr, 2009).



United States has appropriated about $9.9 billion for nanotechnology R&D via National Nanotechnology Initiative since its inception in 2000; other 60 nations have similar programs (Sargent Jr, 2009). About $12.4 billion was spent in 2006 from both the private and public at roughly equal percentages (Sargent Jr, 2009); the estimated R&D is about $12 billion annually (Michelson, 2008). Two BRIC nations, China and India, have made nanotechnology central to their future developments (Parker, 2008) and other nations are implementing similar polices. South Africa remains the only Sub-Sahara African nation with a sound nanotechnology strategy.



Intellectual Property

Technological progress drives national economic development. Increasingly, sustainable national wealth depends on knowledge creation, acquisition and diffusion. The global economic growth rate was insignificant before the industrial revolution and ever since the world has experienced new technology changes. These technologies have brought enormous growths to global wealth.  United Nations Conference on Trade and Development (UNCTD, 1986) has noted that as technology diffuses across national boundaries and firms, intellectual property rights (IPRs) affect the dynamics of technology innovation- the invention and commercialization. Ineffective IPRs will slow the diffusion process as that contributed to lack of technology innovation for many centuries. The drive to innovation is usually attributed to potential economic benefits; without IPRs, this drive could be slowed. This explains why developing nations with low IPRs experience low technology achievement. With no legal structures to protect property, firms may not like to transfer technology since it can be stolen easily by a competitor. Given the dearth of avenues to protect new ideas and economically benefit, developing nations will continue to have problems in technology adoption and diffusion (Coe, 1997). The ability for developing nations to adopt and acquire the tacit knowledge (organizational and managerial-process innovations) of nanotechnology and microelectronics will depend on their capacities to protect property rights in these fields.  While it is important for these nations to attract FDI, license, collaborate and trade for the purpose of technology transfer, it is imperative to understand that only a strong IPRs legal system can encourage MNCs to efficiently develop relationships for transfer. There is a positive correlation between IPRs and technology transfer. The advocacy for open IP structure for nanotechnology (Thakur, 2008) especially for the benefits of developing nations may not materialize. The technology is very expensive that open source model will hinder the progress; only the motivation for wealth creation will ensure innovation and sustainability.



Environmental, health and safety implications

Just like nanotechnology is very broad, the environmental, health and safety issues are varied. The broad spectrum of these issues concern all aspects of nanotechnology activities: laboratory, workplace, consumers and the environment. The rapid rate of advancement and drive to make commercial gain could result to sacrificing safety for commercial gains.  Many stakeholders believe that concerns about potential detrimental effects of nanoscale materials and products on health, safety, and the environment—both real and perceived—must be addressed for a variety of reasons, including (Sargent, 2009):


  • Protecting and improving human health, safety, and the environment
  • Enabling accurate and efficient risk assessments, risk management, and cost-benefit trade-offs
  • Creating a predictable, stable, and efficient regulatory environment that fosters investment in nanotechnology-related innovation
  • Ensuring public confidence in the safety of nanotechnology research engineering, manufacturing, and use
  • Preventing the negative consequences of a problem in one application area of nanotechnology from harming the use of nanotechnology in other applications due to public fears, political interventions, or an overly-broad regulatory response
  • Ensuring that society can enjoy the widespread economic and societal benefits that nanotechnology may offer.


Many nations have developed structures and guidelines for monitoring and regulating many aspects of nanotechnology business (from research to products) to implement acceptable public health and safety levels. The EU has grouped the relevant legislation under four categories – chemicals, worker protection, products and environmental protection (EU, 2004).



Global Market Disruption

Nanotechnology upon maturity will radically change the structure of the global markets. As the technology advances, developing nations, if unprepared, could witness dramatic consequences in terms of trade and employment opportunities. One area of these concerns were captured by Friends of the Earth (see Box 3)




Box 3: Global Market Disruption

In the short-medium term, novel nanomaterials could replace markets for existing commodities, disrupt trade and eliminate jobs in nearly every industry. Industry analysts Lux Research Inc. have warned that nanotechnology will result in large-scale disruption to commodity markets and to all supply and value chains: ‘Just as the British industrial revolution knocked hand spinners and hand weavers out of business, nanotechnology will disrupt a slew of multibillion dollar companies and industries’.

Technological change and the social disruption it brings have been with us for millennia. What will be different this time is that we are confronting the potentially near simultaneous demise of a number of key commodity markets where raw resources (eg cotton, rubber, copper, platinum) may be replaced by nanomaterials, with subsequent structural change to many industry sectors.

The displacement of existing commodities by new nanomaterials would have profound impacts for economies everywhere. However it would have the most devastating impact on people in the Global South whose countries are dependent on trade in raw resources – 95 out of 141 developing countries depend on commodities for at least 50% of their export earnings.

Cotton is an example of an important commodity that could be displaced by the introduction of novel nanomaterials. There are currently an estimated 350 million people in the world directly involved in the production of cotton. Countries in the Global South such as Burkina Faso, Benin, Uzbekistan, Mali, Tajikistan, Cote D’Ivoire, and Kazakhstan rely on cotton as a major source of revenue.

Source: AZoNano (2009)




Driver for Global Innovation Economy


The cyclical boom and bust of leading national economies demonstrate the levels of complexity that confront regulators, investors, markets and industries. While technology has positively increased both individual and national wealth, which for centuries was static, it has also brought major management challenges. The world economy can accelerate very fast, but can also fall as well.  As the present global recession shows, the world has not decoupled the capacity to use technology to mitigate this vicious cycle. While all nations are hurt, some are severely hurt since they lack the technology that can help them accelerate progress during recovery. Over time, the real economic progress rate is the difference between the rates of boom and bust averaged over the time period. A 21st century economy, dubbed the innovation economy, is expected to be an economy with advanced manufacturing and knowledge-intensive jobs through emerging technologies like nanotechnology and green technology via ultra competitive global industries and workers. Medicine, finance, capital markets, entertainment, and indeed all industries will become technology industries. Their survival and growth will depend on the level of technology innovations used.  That brings the challenge of how the world can use technology to actually ‘create the future’ and hence effectively ‘predict it’ with certainty. The world needs a technology solution that will provide powers that can mitigate factors that contribute to global economic downtown. That technology must have the capacity to drive all global industries seamlessly by enabling the right type of tools that will help regulators stay ahead of capital markets, ahead of mortgage crises, ahead of disease outbreaks, etc, and offer corrective measures before the economy reaches that decelerating turning point. An innovation economy must not be an economy of boom and bust. The major questions are these: are there algorithms which the powers of nanotechnology could help to unlock?  Can nanotechnology prevent this cycle by offering more powers to computational systems to extract information and knowledge, requisite to development, and thereby manage the complex global economic variables, preventing busts? Can nanotechnology evolve an era of continuous economic growth and capitalism? Certainly, time will tell.



Box 2: Innovation – The Key to Business Growth: The Irish Story


Collaboration and co-operation through innovation networks

Corporations today are pursuing a globally-distributed, network approach to innovation. Current university programs and company R&D activities reach across borders in search of collaborative partnerships. Companies can most easily reap the rewards of innovation through a global ecosystem in which firms, universities, and governments work together.



Ireland’s innovation landscape

Ireland’s innovation landscape thrives on the importance of human connections. Irish business policy brings together – in a unique, no-nonsense and highly pragmatic way – a wide range of national institutions to help create leading edge research programs. Government, funding agencies, regulatory authorities, academia and industry are constantly working as a national team, creating a fast-growing, dynamic research environment. The result of this high-level connectivity is that Ireland has become one of the new global centers for science- and innovation-based R&D. Ireland is empowering some of the world’s biggest companies to research, develop and commercialize world-class products, processes and services. Long-established partnerships with global corporations have been at the core of Ireland’s success in attracting leading edge R&D activities. Despite Ireland’s small size geographically, its energetic, knowledge-based economy wins a disproportionate amount of Europe’s R&D centers. In 2006 Ireland’s inward investment agency, IDA Ireland, supported 54 R&D investment projects. The past year has seen R&D announcements by many prominent global corporations. The names speak for themselves: CISCO, GlaxoSmithKline, PepsiCo, Intel, IBM, Bristol-Myers Squibb. These corporations are actively supported by renowned global research organizations located in Ireland, such as Georgia Tech Research Institute and Bell Labs.



An integrated, collaborative strategy

The Irish Government pursues a carefully planned, integrated R&D strategy encompassing all of the key elements necessary to achieve world-class R&D. Its US$5 billion ‘Strategy for Science, Technology and Innovation’ will double the number of Ph.D. graduates and attract future generations of well-educated young people into research careers in knowledge-driven companies. It will substantially extend the physical infrastructure to support them. And, for the first time ever, eight government departments will co-ordinate all activity in relation to science, technology and innovation. IDA Ireland is one of the main players behind the new wave of national, collaborative R&D activity. It works closely with Science Foundation Ireland (SFI), the agency which consolidates links between industrial and academic research and funds such research. IDA Ireland and SFI have developed a range of new initiatives to encourage pooled projects and attract world-class scientists to carry out research in Ireland. This inclusive way of bringing together industry and academia has led to a boom in research projects. More than 10,000 researchers are working on cutting edge R&D projects in Ireland. Many of them have relocated from the US, Canada, Japan, the UK, Switzerland and Belgium. Ireland’s Centers for Science, Engineering & Technology (‘CSETs’) link scientists and engineers in partnerships across academia and industry. One such CSET is CRANN, the Centre for Research on Adaptive Nanostructures & Nanodevices. CRANN’s mission is to advance the frontiers of nanoscience. It provides the physical and intellectual environment for world-class fundamental research, and has partners in Irish and overseas universities.



Tax and intellectual property

Ireland’s intellectual property laws provide companies with generous incentives to innovate. The Irish tax system offers huge support to turn brilliant ideas into the finished article. A highly competitive corporate tax rate of 12.5% is a major incentive. No tax is paid on earnings from intellectual property where the underlying R&D work was carried out in Ireland. Ireland recently introduced a new R&D Tax Credit, designed to encourage companies to undertake new and/or additional R&D activity in Ireland. It covers wages, related overheads, plant/machinery, and buildings. Stamp duty on intellectual property rights has been abolished.



People skills

The IMD World Competitiveness Yearbook 2006 rates Ireland’s education system as one of the world’s best in meeting the needs of a competitive economy. It also ranks the Irish workforce as one of the most flexible, adaptable and motivated. Ireland’s young workforce has shown a particular flair for collecting, interpreting and disseminating research information. Major investment in education has provided a skilled, well-educated workforce; Ireland has more than twice the US/European per capita average in science and engineering graduates.



A track record of success

Ireland’s success in innovation spans a wide range of businesses and sectors. For example, some of the most exciting Irish-based product development has been in medical technologies. Over half of all the medical technologies companies based in Ireland have dedicated R&D centers. Boston Scientific researched and developed the world’s first ever drug-coated stent using researchers in Ireland. Bristol-Myers Squibb’s Swords Laboratories is the launch site for several new healthcare treatments used to treat hypertension, cancer and HIV/AIDS. GlaxoSmithKline’s latest Irish R&D project involves groundbreaking research into gastrointestinal diseases, in collaboration with the Alimentary Pharmabiotic Centre in University College Cork. Recently Microsoft marked its 20th Irish anniversary by opening a new R&D center, creating 100 new jobs. The centre is working on a wide range of projects, including Digital Video Broadcasting (DVB) and SmartCard security technology. Intel, a significant supporter of education and training in Ireland, is engaged in several research collaborations with leading Irish universities, including Trinity College Dublin, University College Cork and Dublin City University. Intel’s Irish operation is the global headquarters for the company’s Innovation Centres. Analog Devices’ long established R&D operation is heavily integrated into its Irish operation. Its 335-strong team has sole responsibility for the global design, manufacture and supply of value added high voltage, mixed signal CMOS products.



An exciting future of world-class innovation

Lucent Technologies’ Bell Labs, one of the world’s most eminent research institutions, has established its Center for Telecommunications Value-Chain-Driven Research in partnership with Trinity College Dublin. It will undertake research aimed at realizing the next generation of telecommunications networks. Georgia Tech Research Institute’s new Irish operation will be a critical component of Ireland’s innovation infrastructure. It plans to build up a portfolio of research programs and collaborations with industry which at full operation will employ 50 highly qualified researchers. Wyeth is establishing a bio-therapeutic drug discovery and development research facility at University College Dublin. It will utilize new technologies to discover the next generation of therapeutic biopharmaceuticals for the treatment of a wide variety of diseases. At an academic level, just one illustration of the integration in R&D activity in Ireland is Dublin City University’s Biomedical Diagnostics Institute. It is carrying out cutting-edge research programs focused on the development of next generation biomedical diagnostic devices. Ireland’s success is based on a culture of co-operation and collaboration to win complex, high value, sophisticated investments. The country’s strong business philosophy of inclusiveness, informality and teamwork are the foundations on which Ireland is fast becoming an important player in the development of global innovation networks.



Source: Radwan (2009), Business Week and IDA Ireland





Technology will continue to drive global economic and social progress bringing improvements in people, processes and tools while shaping institutions and nations. Nanotechnology will be very central to new economic disruptions in the next few years. Just as microelectronics has brought phenomenal progress in industrial efficiency, capacity and speed, nanotechnology will drive a new international economy whose competition will be technology.  From health to entertainment and to neuromorphics, these two technologies will be pivotal to solving many global problems like environmental and climate issues, HIV/AIDS cures, cancer, Parkinson disease, etc. Nations that develop and commercialize nanotechnology will reap enormous economic benefits and this technology could possibly restructure the dynamics of global competitiveness in this new millennium. Unfortunately, it has the possibility of evoking global crises if many raw materials usually imported from developing nations are engineered through nanotechnology in developed nations thereby depriving the poor economics their sources of foreign earnings. But the developing economies have opportunities to invent and structure themselves to depend on knowledge, instead of minerals, to avoid obsolescence in the emerging innovation economy. Planning for nanotechnology economy, nanomics will be very important as convergence of nanotechnology and microelectronics will redesign all global economic, political and social structures. A Nano World Order of nano-ethics, anti-nanoweapon-proliferation, nano-civilizations, and nanomics.  New embodiments of knowledge, driven by issues, holistic in approach, strategic and proactive in plans, and designed for intergenerational commitment, and sustainability will be needed to manage the convoluted and complex factors that range from ethics to global safety.







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Editor’s Note: This chapter was partly funded by Samstag Fellowship-awarded by Whiting School of Engineering, Johns Hopkins University (JHU), USA.

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