The coordination problem relates us to not only the levels of activities like research and developments (R&D) and investments but also to the behaviour of institutions that characterize the economy. Externalities can determine the ranking of alternative course of behaviour. In the evolutionary settings, the equilibrium on which the economy converges depends on its history. Thus, opening of a country to international competition that differentially ‘hurts' beaureaucratic firms in the economy may move the economy from one equilibrium to another thereby affecting the language technological progress.