Before reviewing literature for nation-state and policy, there’re couple questions emerging in my mind: what role does nation-state play? does nation-state become less important, or does government policy become less effective? The answer is maybe or may not.

We can see that government collaborations such as G20 or G8 are leading the way to resuscitate the economy through billions of funding and to salvage endangered enterprises in this global financial storm.  However, some scholars like Barnet and Cavanagh believe that the way TNCs operate has caused nation-state to lose its authority and to erode in its ability to increase welfare for its citizens. (see Lyth and Trischler, 2004, pp. 8). In Technical and Institutional Innovation, Ruttan (2001, pp.115) stresses the importance of intervention and sufficient resources by a central authority to avoid lock-in of an inferior technology. He gives an example of the U.S. chemical industry superceding its German counterpart by swift successful transition to petroleum-based from coal-based. We need necessary infrastructures built by governments for R&D activities as well as a legal system available to protect the intellectual property rights for the generation, transfer, and diffusion of technology. (see Archibugi et al.,1998). Actually, the government’s role becomes much more important. As a matter of fact, Irish government’s efforts through free public college education, low corporate taxes, and better infrastructure have turned around Ireland from the sick man of Europe to the rich man in less than a generation (Friedman, 2006).

      Developing countries can benefit from globalisation of technology if they implement active policies designed to increase learning and improve access to knowledge and technology.  Public policies should therefore induce firms to move from exporting their products to producing locally, and transferring a technological component. In addition to using FDI as a learning opportunity and as a channel of technology transfer, government policies should also try to “upgrade” FDI to strategic technological partnering, fostering collaborations among public and business organizations since doing so will generate externalities which are beneficial for the whole economy. (Archibugi and Pietrobelli, 2003).

For countries in the journey of innovating, policy is long time being recognized as a one of the key factors in achieving national comparative advantage. According to Archibugi and Iammarino (2001), two different tendencies have emerged over the debate on innovation policies. One school of thought regards government policies as irrelevant to strengthen the technological competencies of the country. By contrast, the other school of thought believes that a broader spectrum of public polices is required to equip every nation with technological advantages in face of increasing globalisation. In The Political Economy of Globalisation, Kitson and Michie (1999) argue that increased globalisation of trade and technology increases the need for active government economic, trade, industrial, and technology policies. This implication may be biased, because, as technology develops, geographic boundaries among nations become obscure and things change rapidly.  Thus, national technology policy is susceptible to external volatility and might be, if not necessary, no longer as vital as it used to be to determine one country’s technological capabilities, due to which more researches are needed to investigate its neo-level of influence. 

      To summarize the literature review, there have been little quantitative and qualitative analyses undertaken to study how approaches and concepts like statistic analysis, social constructivism (ANT), cultural analyses or diffusion model relates the outcomes of ICT (specifically the Internet and mobile phone/technology) innovation, diffusion and transfer to the social-economic, social-political and cultural perspectives in the global, international, or universal fabric (Avegerou, 2003a; Madon, 2003).