ROLE OF MICRO‐INNOVATION IN TECHNOLOGY ADOPTION: THE CASE OF SILK FILATURE IN JAPAN AND COLONIAL INDIA

In the 18th century, the East India Company introduced Italian filature technology to the silk‐reeling industry in the Indian province of Bengal in order to produce silk suitable for the European market. The experiment failed in Bengal despite its superiority over the traditional method and eventually moved to Japan in the late 19th century, where it was successfully adopted. In this paper, drawing on the Japanese case, we examine the reasons behind filature's failure in Bengal. We focus on the role of micro‐innovation in technology adoption and argue that in Bengal's case, the East India Company failed to provide incentive for such micro‐innovation because of its dual status as the monopoly trader and de facto ruler of Bengal. On the other hand, the Japanese silk industry was characterized by competition, which played a key role in the successful technology adoption.