Features and role of intermediate technology
- It should produce the quality and quantity for the suitable and identified local markets.
- It should create and offer various employment prospects.
- It must reduce the misuse of foreign exchange.
- It must be capable of being easily adopted into the existing plan targets.
- It should minimize uneven distribution of incomes.
- The technique must be compatible to the economic requirements of the community/society.
- It should be able to optimally utilize the available local resources.
- It must stimulate a substantial degree of integration within the economic system.
- The technique to tally with the technological requirement of society.
- It should lead to a balanced regional development and a greater dispersion of industries to avoid localization.
But in most cases, the government may not have any choice of a production technique. It can either opt for capital intensive or labour intensive technology because it depends on who makes the choice.
a. The investor.
A private investor will aim at profit maximization, probably by opting for capital intensive technology, thereby playing an insignificant role in labour absorption.
b. The government.
The state sector can make its choice of technique basing on the possible social benefits and costs. The following may be influenced by government choice of technology.
- The rate of capital accumulation.
- The use of the domestic resource potential.
- The rate of growth of output.
- The employment potential in both the short and longrun.
- The export market products potential especially with foreign aid.
- The forward and backward linkage potential.
However, it should be noted that this might depend on whether the industry is technologically flexible. For example, metal industries, oil and petroleum product are non flexible industries, technologically. So, quite often, LDCs employ different types of industrial production techniques known as industrial dualism.