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Development of a new market (market innovation);

Creation of a new benefit or a benefit of a new quality (product innovation);

Creation of a new method of production (process innovation);

development of a new market (market innovation);

4. provision of a new source of raw materials or semi-finished products (new sources of inputs\ input innovation);

5. reorganization (creation of new economic forms; new organizations\ organizational innovation).

Some researchers contrast fundamental and secondary innovations. For example, Howittnotes the heterogeneity of the innovation process: fundamental innovations are the result of fundamental research, and secondary ones are the result of manufacture process; and, as a result, transition of labour force into the research sector can lead to lower economic growth (Howitt, 1974).

A German scientist, Gerhard Mensch, developing Schumpeter's ideas on innovation, offered his classification of innovations in order of their importance:

· primary innovations,

· improvement-oriented innovations,

· false innovations.

Primary innovations form new industries and markets, or lead to significant changes in the areas of governance, culture and social services. Improvement-oriented innovations, according to G. Mensch, are associated with various "modifications" of primary innovations, their maximum adaptation to the changing market conditions. False innovations are minor changes which have a "decorative" character (Mensch, 1979).

Summing up all the mentioned points we can draw the following conclusions:

· innovation is a process of transformation (conversion) of creative work results into new products, technologies or services, which ensure the growth of competitiveness. The main function of innovation is that it causes economic and social dynamics, i.e. development and progress in the economy and society as a whole.

· Innovations can be classified on a number of criteria: degree of innovation, scope, nature of customer satisfaction and innovation activities, the scale of investment, their efficiency to other parameters.

· In today's economy the role of innovation is high. It provides competitive products and enterprises the opportunity to obtain a high income. In a market economy, innovation is an effective means of competition

· The increasing complication of modern economies triggers the necessity in a higher rate of economic interaction. Today’s knowledge-based economies depend on active technological progress.

· The generation of innovation no longer depends on individual personalities but means cooperation of many different factors. This needs cognitive capabilities that boost the diffusion, and thus the understanding of innovation leading to entrepreneurship.

· The J. Schumpeter’s innovation and entrepreneur concept is universal and still evolving in principles of Neo-Schumpeterian economics. It goes without saying that Schumpeter’s thoughts have never been so appropriate as they are nowadays, when modern capitalism is experiencing serious problems and going through hard times.




Date: 2015-12-24; view: 899


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