For many countries there are two legal means for obtaining technology. to permit multinati

onal companies to conduct business within their borders and the use of licensing agreements. Japan rank high among the nations that have. gone to some lengths to keep foreign -owned companies out of industries connected with national defense, and the case of Japan is commonly cited for the idea that such a policy is feasible. In this case, multinational ownership is not important fox-the efficient transfer of technological information between nations; the use of licensing agreements is just as efficient.

For over a hundred years Japan has consistently spent large sums of money and considerable human resources in an effort to obtain technology. Her ability to negotiate has been strengthened by the fact that most of the technology she wanted was not very secret. Japan's position has also been strengthened by the fact that her internal market was large, so that access to this market could be offered to multinational companies as an incentive for them to grant licenses. Besides, Japan's work force was literate and disciplined, so it was capable of applying the information it acquired. Finally, American and European companies might take a large share of the world market if they were not limited by licensing agreements.

Conditions of this sort, coming together in one nation, may well be unique, and the case of Japan may therefore not actually demonstrate that licensing is just as efficient as multinational ownership for the transfer of technology. In fact, Japan may be finding this method of operation less effective than in the past, as her needs for outside technology now require information which belongs to only a few companies and is more closely held. Further- more, her need to use the markets of other countries is beginning to weaken its negotiating power she once had because of her control of her access to her internal market.

Which of the following is NOT a reason for foreign companies to be will ing to license the use of their technology？

A．The technology required by Japan is not secret.

B．It might be easier for foreign companies which has transferred tech nology to Japan to enter the Japanese market.

C．Japan possesses high-quality workers.

D．Licensing help Japan in expanding into the world market.