Technology Diffusion in the Telecommunications Services Industry of Malaysia

This study empirically models technology diffusion and incorporates a more comprehensive framework in understanding the diffusion process of telecommunications technology in Malaysia. We inductively assess the government's conduct in translating the productive rents for upgrading activities. The results show that the proactive role of the government when intervening in market operations has considerably influenced the technology diffusion process. The telecommunications services industry of Malaysia achieved a critical mass of entrepreneurs by first engaging business entrepreneurs in contract services from Malaysian Telecommunications Department, then moved to business diversification at the end of 1970s and is now developing a market platform to furnish its sustainable telecommunications system. We highlight positive general macro-meso views of our case and provide salient normative principles as guides for transformational policy-making. The principles discussed in this paper provide policy lessons, or at least some initial guide, for other developing economies aspiring to follow the path of technology upgrading and development.