Lecture 9 - Evolving policy perspectives on innovation

Science, Technology and innovation policy

Merit course – 2006

� The evolution of innovation policy� A neoclassical perspective on innovation

policy� An evolutionary perspective on innovation

policy

Big Science and WW II

� Francis Bacon (1627), J.D. Bernal (1939) and V. Bush (1945)

� The social and economic utility of science� Large scale projects: Manhattan Project,

nuclear energy, Apollo programme (Big Science)

� Little science and the linear model

Science policy

� Mobilization of sufficient funds and allocation to projects / disciplines

� Serendipity vs. demand steering

� A modern issue: should university knowledge be patented?

Technology policy

� Science based technologies as an engine of growth

� Specialization and strategic industries (Krugman’s strategic trade)

� Latecomers and catching-up

Technology policy questions

� Which technologies?� At what stage of development?� What about competition?� The market knows best?

Innovation policy

� Innovation as a broad phenomenon (not only high-tech sectors)

� Innovation systems:– systemic failures (lack of coordination)– Interaction (public-private)

� Learning and education

Neoclassical policy: market failure

� Spillovers and the lack of incentives– Basic science (the Ps)– R&D subsidies (growth models)

� But also: negative spillovers– R&D taxes?

The implementation of policies

� Tax cuts vs. subsidies� Additionality of R&D subsidies?� “Picking winners”? and generic vs. specific

policies

Evolutionary innovation policy

� The blind watchmaker revisited– Does the free market generate enough

experimentation?

� No role for optimality� The adaptive policymaker (Metcalfe)

Adaptive policy – the basics

� A disequilibrium approach: deviant economic behaviour drives change

� Innovation systems are capable of multiple responses to incentives

� Innovation outcome is unpredictable� Brings in resources and capabilities (to

manage innovation processes)

Collaboration and systems

� Linked to the management of innovation resources

� Missing system elements: are all relevant knowledge sources present?– Set up new research organizations– Entrepreneurship

� Missing connections: opportunities and incentives for collaboration– Enhancing awareness– Removing barriers to collaboration

Trends

� Privatization of (semi-)public research organizations

� Globalization and European integration: the FWP

� Entrepreneurship and innovation