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Impact of innovation policy on firm innovation – A comparison of Finland and Sweden, 1970-2013

Author

Listed:
  • Torregrosa, Sara

    (Department of Economic History, Lund University)

  • Pelkonen, Antti

    (VTT Technical Research Centre of Finland)

  • Oksanen, Juha

    (VTT Technical Research Centre of Finland)

  • Kander, Astrid

    (Department of Economic History, Lund University)

Abstract

To what extent have public policies contributed to the innovation performance of Finland and Sweden in the period 1970-2013? This paper aims to assess the share of innovations stimulated by the public sector, specifically because of receiving public funding or being the result of research collaboration with public institutions. We combine survey and LBIO results on these variables, to overcome reporting biases found in the two methods. The main data comes from the new UDIT dataset, which gathers the most significant innovations of both countries for the period, in total about 4,100 Swedish and 2,600 Finnish innovations. It has been constructed following the LBIO method (Literature Based Innovation Output), which obtains information on relevant commercialized innovations from general technology journals as well as industry specific trade journals. Our results indicate that Finland had a substantially larger public involvement in these innovations than Sweden. This is specially true in the years between 1990 and 2000, when we see a drop in the relative role of the Swedish public sector in innovation output, while the Finnish trends are constant or slightly increasing over the period. However, in both countries public policies lie behind a significant share of the innovations (30-50% in Finland, 15-35% in Sweden), and in the Swedish case we can further assess that the publicly stimulated innovations were more often found among the most significant new products (written about in several articles).

Suggested Citation

  • Torregrosa, Sara & Pelkonen, Antti & Oksanen, Juha & Kander, Astrid, 2017. "Impact of innovation policy on firm innovation – A comparison of Finland and Sweden, 1970-2013," Lund Papers in Economic History 160, Lund University, Department of Economic History.
    • Handle: RePEc:hhs:luekhi:0160
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    References listed on IDEAS

    as
    1. Lemola, Tarmo, 2002. "Convergence of national science and technology policies: the case of Finland," Research Policy, Elsevier, vol. 31(8-9), pages 1481-1490, December.
    2. Mokyr, Joel, 2010. "The Contribution of Economic History to the Study of Innovation and Technical Change," Handbook of the Economics of Innovation, in: Bronwyn H. Hall & Nathan Rosenberg (ed.), Handbook of the Economics of Innovation, edition 1, volume 1, chapter 0, pages 11-50, Elsevier.
    3. Scott J. Wallsten, 2000. "The Effects of Government-Industry R&D Programs on Private R&D: The Case of the Small Business Innovation Research Program," RAND Journal of Economics, The RAND Corporation, vol. 31(1), pages 82-100, Spring.
    4. Holger Görg & Eric Strobl, 2007. "The Effect of R&D Subsidies on Private R&D," Economica, London School of Economics and Political Science, vol. 74(294), pages 215-234, May.
    5. Josh Lerner, 2013. "The Boulevard of Broken Dreams: Innovation Policy and Entrepreneurship," Innovation Policy and the Economy, University of Chicago Press, vol. 13(1), pages 61-82.
    6. Stiglitz, Joseph E., 2015. "Leaders and followers: Perspectives on the Nordic model and the economics of innovation," Journal of Public Economics, Elsevier, vol. 127(C), pages 3-16.
    7. Antti Pelkonen, 2006. "The problem of integrated innovation policy: Analyzing the governing role of the Science and Technology Policy Council of Finland," Science and Public Policy, Oxford University Press, vol. 33(9), pages 669-680, November.
    8. Sjöö, Karolin & Taalbi, Josef & Kander, Astrid & Ljungberg, Jonas, 2014. "SWINNO: A Database of Swedish Innovations, 1970-2007," Lund Papers in Economic History 133, Lund University, Department of Economic History.
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    Cited by:

    1. Astrid Kander & Josef Taalbi & Juha Oksanen & Karolin Sjöö & Nina Rilla, 2019. "Innovation trends and industrial renewal in Finland and Sweden 1970–2013," Scandinavian Economic History Review, Taylor & Francis Journals, vol. 67(1), pages 47-70, January.

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    JEL classification:

    • I28 - Health, Education, and Welfare - - Education - - - Government Policy
    • N70 - Economic History - - Economic History: Transport, International and Domestic Trade, Energy, and Other Services - - - General, International, or Comparative
    • O38 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Government Policy
    • O57 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - Comparative Studies of Countries

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