Abstract
Firms in developing economies should accumulate the capacity to effectively acquire modern technologies to be able to compete globally. This study aiming to identify the factors that contribute to technology acquisition capacity (TAC) emphasizes the need to appropriately conceptualize the capacity and develop indicators to represent the same. It proposes a framework for that purpose. The study identifies variables in a firm's internal & external environments, which are likely to be related to this capacity, and hypotheses several relationships between them. The data collected from 44 medium and large-scale firms in the Indian capital goods sector are used to test the hypotheses. The results of the data analysis show that the variables such as the environmental pressure as perceived by firms, the extent to which firms outsourced technological information and support services, the extent to which firms integrated suppliers into their business, the diversity in firms' functional specialization and their outlook into the future are related to this capacity. Thus the findings of the study suggest that both firm-controlled factors as well as State-controlled factors have a role in determining the TAC.
