PhD thesis defence by Ivo Iliev
In a matter of a few decades, computers have evolved from clunky vacuum-tube machines to lean general-purpose devices powered by integrated circuits. Their very existence has produced a variety of new opportunities for economic specialisation and positioning within global value chains, but also challenges and traps for late-developing countries. Although these changes are global in scope, individual countries have navigated them differently. Some have developed a comparative advantage in high-tech ICT industries such as software, and others have fallen behind. To explain such cross-country differences, this thesis advances two central arguments. Firstly, comparative advantage in digital sectors is embedded in man-made institutions, which mediate societal and entrepreneurial response to technological change. A country’s position in global digital markets is neither predetermined by the functional characteristics of technology, nor is it the spontaneous aggregate outcome of decentralised individual efforts. Rather, it depends on governmental effort to disseminate technological achievements broadly and to elicit entrepreneurial behaviour. Secondly, such institutions are devised at critical historical junctures and thus remain subject to long-run processes of inherited cumulative advantage. Early policy decisions may trigger self-augmenting processes of human capital creation that outlast their creators even beyond dramatic societal ruptures.
These two arguments are substantiated empirically by tracking the different trajectories of the computer electronics and software industries in several Southeastern European nations across multiple decades – Albania, Bulgaria, Romania, and Serbia. Methodologically, the dissertation is based on comparative historical analysis and draws on a wide range of qualitative and quantitative sources, ranging from archives and semi-structured interviews to macroeconomic and self-collected firm-level data. As such, it contributes to political economy scholarship seeking to understand the dynamics of belated development in semi-peripheral countries, as well as to theoretical perspectives accounting for the relationship between technology and policy-making.
Ivo Iliev is a PhD researcher at the SPS department of EUI. He works on digital technology, industrial policy, and the political economy of post-communist transition in Central and Eastern Europe.