The Tower Of Babel? The Innovation System Approach Versus Mainstream Economics
AbstractThe Innovation systems (IS) approach and the system failures it identifies, play an important role in the design and legitimization of innovation policy. This paper analyses the usefulness of this concept. We conclude that the IS-approach can be useful to visualize the complexity of the innovation processes. However, for policy design this approach is less suited, because system failures aim at symptoms in stead of underlying incentive structures. In our view, policy design should be based on standard economic framework of market- and government failures. Theoretically, an exception is the system failure path dependency. However, the empirical evidence for the existence of this phenomenon is mixed. Furthermore, policy initiatives to tackle path dependence are likely to be subject to severe government failure.
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Bibliographic InfoPaper provided by EconWPA in its series Method and Hist of Econ Thought with number 0403001.
Length: 15 pages
Date of creation: 04 Mar 2004
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innovation policy; Innovation systems; market failure;
Find related papers by JEL classification:
- O38 - Economic Development, Technological Change, and Growth - - Technological Change; Research and Development; Intellectual Property Rights - - - Government Policy
This paper has been announced in the following NEP Reports:
- NEP-ALL-2004-03-07 (All new papers)
- NEP-CBE-2004-03-07 (Cognitive & Behavioural Economics)
- NEP-HPE-2004-03-07 (History & Philosophy of Economics)
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