Competition can be seen as a selection process; adopters select between products (innovations), which leads to selection among firms (some may be competed out of the market) or their strategies and designs (some may have to adopt designs other than their own).ongly consistent bloc of theory.
Variety created through creativity (even chance discoveries have to be creatively understood); But this is not random mutation, innovation results from search, research, problem-solving; It could be seen as having Lamarckian properties. There can also be transfer between “species” (knowledge is more than information).
Key terms in ET:
· Bounded rationality (firms do not constantly make cost-benefit-calculations)
· Routines (typical behavior, reduce uncertainty)
· Population (group of firms)
· Mutation (Radical innovation – like “mutation” strong break with existing routines)
· Selection (survival of the fittest firms through market mechanisms)
· Satisfysing behavior (firms do not maximize any undefined profits, but they have business goals they intend to reach)
„Paradigm-Trajectory approach“ (Dosi, 1982)
Paradigm: dominating concept / generally accepted “believe system”
Origin: Science theory (Kuhn 1962: “The structure of scientific revolution“)
· In depth analysis of most growth intensive industries of the 20th century (chemical, mineral oil, plastic …)
· Industries depend heavily on scientific results – growing need for cooperation between industry and science (universities, research institutes etc.)
Origins of the “Systems” Idea: Chris Freeman
The concept of the innovation system stresses that the flow of technology and information among people, enterprises and institutions is key to an innovative process. It contains the interaction between the actors who are needed in order to turn an idea into a process, product or service on the market.
Comparative analysis of national innovation systems:
-Why Japan succeeded: enabled adoption and diffusion of technologies and techniques; R&D, technology imports and production were integrated at firm level – and with the Kairetsu Model, there were strong user-producer linkages. State support important.
• USSR, in contrast: weak user-producer linkages; Weak links between industrial innovation and basic research in RAS research institutes, sectoral bodies for applied R&D), bodies active in design and import.
Critical Variations between ISs:
• Level, form, and location of R&D and other knowledge-producing innovative effort
•Availability and application of human capital (skills for innovation and uptake, for learning-by-doing) – deployment of knowledge, development of practical knowledge
•Industrial structures: cooperation and competition in supply chains, links with finance – sharing of knowledge among actors.
•Supportive policy structures – including IPR, standards, and incentivisation.