Human Resource Development Policy in the Context of Software Exports: Case Evidence from Costa Rica

Brian Nicholson and Sundeep Sahay


Software industry development is acknowledged as an important engine of economic growth for many developing countries. The role of national policy has been identified as a catalyst to software industry development and, more specifically, to software export development. Software development is a service that is both labour- and skill-intensive. Thus an important aspect of related policy is concerned with provision of appropriately educated and trained human resources (HR) in sufficient quantity. This paper provides an analysis of human resource issues facing policymakers in developing countries engaged in software export policy formulation. The complexities are highlighted through the case study of Costa Rica where there is an ongoing strategic planning effort to increase software exports. Action research work in Costa Rica based on a model of developing both "high spectrum" and "low spectrum" software skills shows there are constraints to both HR quantity and quality. Some ways forward for early-stage software exporters like Costa Rica are relatively easy to prescribe and implement. Others, though, will be harder to achieve since they are contextually constrained by both formal and informal institutions.

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Educator's guide

Synopsis questions

  1. What elements of national policy for software exports are particularly important? [Introduction]
  2. What HR strategies have leading software exporting nations adopted? [Part A]
  3. Describe the research approach used in this study. [Part B]
  4. What are the main HR issues facing Costa Rica's software industry? [Part C]
  5. What must Costa Rica do to strengthen human resources in order to become a successful software-exporting nation? [Part D]

Development questions

  1. Does government policy on HR for software industry development really matter, or can this all be left to the private sector?
  2. What impact might a software sector - particularly software exports - have on Costa Rican development?
  3. Do you think Costa Rica's software industry should focus on English language skills and on the US market? Are there alternatives?
  4. Consider the suggestion that Costa Rica policy should focus on developing high spectrum skills. What feasible alternatives might there be?
  5. What are the implications of the Costa Rican case for other developing/transitional economies?