countries, including 250 in Africa with 80 African PhD students, funded by agencies from Africa, the EU, France, UK and US) established local university research programs in climatology, agronomy and related social science fields, and built functional and research teams that built new capacity for improved early-warning systems. These research teams and university programs will in turn continue to train cohorts of African specialists, thereby cultivating a community whose mutual interest in AMMA-related issues will help ensure sustainability.

Although AMMA has been relatively successful in building an international community in partnership with Africans in its first phase (2002-10), the main challenge moving forward in its second phase (2010-20) is to stimulate and ensure sufficient two-way conversations between what users need and what science is capable of doing, in particular generating sufficient downstream demand for improved forecasting and early-warning systems in terms of pull-through of knowledge by users making decisions on the ground: by farmers in terms of when to plan, by hydropower and flood managers in terms of operation of dams, by healthcare side in terms of diseases driven by dust (meningitis) and mosquitoes (malaria, etc.) – in this way, with stronger downstream user demand, the support by politicians for required scientific resources would be more likely. Source: Thorncroft (2011).

# **_3.3.2 Develop broader absorptive capacities_**

Three policy areas are discussed here that may be particularly important in most developing countries in affecting the ability of entrepreneurs and firms to learn, namely how the prevailing business environment can facilitate experimentation and quick market re-entry following failure, facilitate collaborative learning by workers and firms from leading global firms, and help attract and retain talent.

Policies to **overcome the stigma of failure** and encourage opportunities for re-entry and renewed experimentation seem to be important drivers of innovation. The US approach to corporate bankruptcy puts economic resources back to productive use as quickly as possible, either saving viable companies from premature liquidation or putting pressure on courts to restructure assets quickly.<sup>43</sup> While closing a terminally ill business takes less than 10 months and allows over 90 cents on the dollar to be recovered in Canada or Singapore, it still takes on average 7 years in Mumbai to recover roughly 16 cents on the dollar (World Bank 2011). Although difficult legal reforms and changes in attitude to debt are involved, making it easier to wind up businesses is one of the best ways to get more people to try out new ideas and start them. In addition, it would probably also be helpful to make existing innovative role models more widely known, such as India‘s Tata group awarding an annual prize for the best failed idea.<sup>44</sup> So would policies that reduce the level of sunk costs required to try out a commercializable idea in the first place. This includes improving the depth of resale markets, so that fixed assets such as the machines in a production line that didn‘t work out can be quickly and easily resold. And removing impediments for electricity and IT-serviced business premises to be easily leased or rented rather than requiring more significant investments in own assets while the market size for a product is not yet known.

Facilitating **global connectivity** of people through global alliances and insertion of firms into global value chains also is critical for enhanced learning. In both China and India‘s rapid development of wind energy capabilities, while licensing agreements with European manufacturers to gain initial access to turbine technology were important, international mobility of workers was as important if not more so: Suzlon, the top Indian wind turbine manufacturer, established R&D facilities in Germany and the

> 43 Chrysler and GM were in hands of changed owners in 45 days of filing for bankruptcy. 44 See the Schumpeter column in The Economist (April 14, 2011).

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