Obstacles to ‘Catch-Up’: The Case of the Indonesian Aircraft Industry

Abstract

This paper examines the development of the Indonesian aircraft industry. Despite the accumulation of considerable engineering and production capabilities, technical competence has not been a sufficient condition for commercial success. An important reason for the asymmetry between technical accomplishment and performance is underdeveloped managerial capacity. This case raises questions about the viability of policies intended to promote technological ‘catch up’ in complex industries.