Dual-Use Technology and Defence–Civilian Spillovers: Evidence from the Norwegian Defence Industry

Abstract

Spillovers from defence-industrial developments have strongly influenced civilian technologies. Despite the international academic and political interest in defence–civilian spillovers, little is known as to whether the Norwegian defence industry affect civilian innovation. This thesis investigates the extent of defence–civilian spillovers of dual-use technologies from the Norwegian defence industry, and factors facilitating this. The thesis builds on a mixed-methods application of quantitative and qualitative approaches. From an extensive collection of Norwegian defence patents and subsequent international citations, from 1970 until 2012, the study provides a new empirical dataset with quantitative evidence of defence–civilian spillovers. Through a combination of patent data and detailed firm-level data, statistical analyses test the relevance of several hypothesised explanatory factors for spillover. The study further provides qualitative evidence from interviews of company representatives on dual-use technology and the factors affecting spillover.

The main findings show that the military developments of the Norwegian defence industry have in the last decades generated substantial spillovers in the form of dual-use technology to civilian industries. This has increased in the latest decade, contrary to what other scholars have claimed. The international component is substantial compared to domestic spillovers, indicating that most Norwegian dual-use technologies are utilised abroad. Several factors affect this diffusion of technology. Company investments in R&D, collaboration with research institutes, and the facilitation of broad technological knowledge bases affect civilian usage of military technologies. Moreover, a heightened focus on civilian production increases the potential for spillovers, just as a greater defence focus acts to decrease inter-sectoral spillovers. The main findings support international studies of dual-use technology by broadening the explanatory factors and expanding on how empirical data can be collected.

A general implication of these findings is that policies implemented for supporting military development in the Norwegian defence industry have had indirect civilian benefits. Nonetheless, these policies should be strengthened to encourage civilian Norwegian firms to take greater advantage of military developments – an area in which civilian firms in other countries have been far more active.