The point of departure for this paper is that in developing countries SMEs are responsible for the largest part of employment and a significant share of added value. And that innovation policy supporting the particularities of SMEs has been widely ignored (occasionally SMEs have even been discriminated). This chapter aims at shedding some light on the immensely complicated issue of innovation policy for SMEs in developing countries, or more specifically Asian SMEs. The chapter applies the so-called regional innovation systems approach. In this paper, we analyze four clusters of SMEs that have been especially successful in entering the global market; special attention is paid to the so-called soft infrastructure, the industry specific needs for cluster (e.g. interaction) and RIS dynamics/polices (e.g. needs for devolution; industry specific needs for building knowledge creating institutions).The chapter is structured as follows. After introducing stylised facts on SMEs innovative performance attention is turned to the theoretical framework. Taking into account the localized nature of SMEs economic activity, our level of analysis is the regional system of innovation (RIS). We provide a general introduction, contextualize this to Asian situation, and introduce the industry differences (inspired by Pietrobelli and Rabelottis typology). Then we turn to the empirical section where special attention is paid to the four cases. Finally, we turn to drawing general conclusions on innovation policies and need for restructuring of Asian innovation systems (the accent is on the former).
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Paper provided by CIRCLE (Centre for Innovation, Research and Competence in the Learning Economy), Lund University in its series CIRCLE Electronic Working Paper Series with number
2005-06.