grant schemes have been used to assist in building a “training culture” by providing both an incentive and a means of investing in training as in Mexico’s CIMO program.<sup>46</sup> Relatively successful training programs for the informal sector have been located in Peru, Botswana, Zambia, Costa Rica and Argentina, run mainly by NGOs.<sup>47</sup> When combined with donor assistance programs they have proved effective. In general, as a study of training programs in seven developing countries show, private-sector provided training has had significant impact on productivity while the effectiveness of government sponsored training programs has been relatively poor.<sup>48</sup> _World Bank projects_ _56._ In recent years, project related training, including investments in sectoral training institutions has varied between $300-$500 million a year, and has accounted for 3 percent of WB lending. Several World Bank reviews in the 1980s identified the problems that plague training projects—weak national capacity for managing and delivering training, lack of incentives to organizations and employees to undertake training, and lack of coordination among national training organizations. Project-related training investments that relied heavily on external consultants to design and deliver training failed to overcome these limitations, and the results of these investments were mixed, at best _._<sup>_49_</sup>

# **C. Support to technology development**

57. Almost all countries have schemes for stimulating and supporting private R&D, helping technology development in SMEs, and allowing firms to pool their resources in pre-competitive technological effort. At the institutional level, most countries provide technological ‘public goods’ such as standards, measurement, information, productivity raising services for SMEs, and basic research. Lately, there has been renewed interest in techno-parks, clusters and incubators as a means of jumpstarting economic growth in regions whose economies are disproportionately concentrated in slow growth industries. Technology incubators in particular aim to help tenant firms gain access to, apply, and market technical knowledge in their infancy stages.

58.Evidence from developed countries show some positive results. For example, in the U.S., 80% of incubator “graduates” survive after five years compared to a survival rate of only around 40% after five years for the general population of firms. Australian data shows that 50% of graduate firms were still in business compared to only 5% of nonincubator firm. In France, only 8-20% of incubator firms depending on the technology group failed compared to 31% of new firms in general.<sup>50</sup> On the other hand, some studies

> 46 Minowa (2000),

> 47 NGOs are also involved in apprenticeship type programs, as in the Philippines where the NGO organization Dualtech has targeted apprenticeship programs for poorer students.  Other examples of relative success include the Kenya voucher program, Cote D’Ivoire’s training program for the informal sector and the Grassroots Management Training Program for women in India (Middleton, et. al _op. cit._ ).

> 48 Tan and Batra (1995), Batra (1999, 2000).

> 49 Middleton et. al., _op. cit_ .

> 50 OECD (1997). It is not clear if there is any self-selection bias here. Self-selection bias may occur if firms are admitted to the incubators only after intensive screening, which weeds out weaker firms, or if only the more dynamic firms seek entry into incubators.

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