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Contests for Cooperation: A New Approach in German Innovation Policy

  • Alexander Eickelpasch
  • Michael Fritsch

A new approach in German innovation policy organizes contests of proposals for developing innovation networks. Based on an overview of the different programs, we investigate the advantages, problems and limitations of such an approach. We find that this type of policy may have a relatively large impact and can, therefore, be regarded as a rather efficient instrument of innovation policy. Compared to conventional policies, administration of the program is a much more critical issue. The contest approach may stimulate learning effects on the side of the administration but may also require a high degree of flexibility. The main disadvantage is the additional time that is required for conducting the contest. As a distinct 'picking the winner' approach, the contest approach is not suited as a means for achieving a leveling-out of regional welfare levels.

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File URL: http://www.diw.de/documents/publikationen/73/diw_01.c.43115.de/dp478.pdf
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Paper provided by DIW Berlin, German Institute for Economic Research in its series Discussion Papers of DIW Berlin with number 478.

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Length: 22 p.
Date of creation: 2005
Date of revision:
Handle: RePEc:diw:diwwpp:dp478
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  1. Viktor Vanberg & Wolfgang Kerber, 1994. "Institutional competition among jurisdictions: An evolutionary approach," Constitutional Political Economy, Springer, vol. 5(2), pages 193-219, March.
  2. Fritsch, Michael, 2003. "Do regional systems of innovation matter?," Freiberg Working Papers 2003,03, TU Bergakademie Freiberg, Faculty of Economics and Business Administration.
  3. Dohse, Dirk, 2000. "Technology policy and the regions -- the case of the BioRegio contest," Research Policy, Elsevier, vol. 29(9), pages 1111-1133, December.
  4. Rachel E. Kranton & Deborah F. Minehart, 2001. "A Theory of Buyer-Seller Networks," American Economic Review, American Economic Association, vol. 91(3), pages 485-508, June.
  5. Franz Tödtling & Michaela Trippl, 2004. "One size fits all? Towards a differentiated policy approach with respect to regional innovation systems," SRE-Disc sre-disc-2004_01, Institute for Multilevel Governance and Development, Department of Socioeconomics, Vienna University of Economics and Business.
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