Models that depict innovation as a smooth, well-behaved linear process badly misspecify the nature and direction of the causal factors at work. Innovation is complex, uncertain, somewhat disorderly, and subject to changes of many sorts. Innovation is also difficult to measure and demands close coordination of adequate technical knowledge and excellent market judgment in order to satisfy economic, technological, and other types of constraints—all simultaneously. The process of innovation must be viewed as a series of changes in a complete system not only of hardware, but also of market environment, production facilities and knowledge, and the social contexts of the innovation organization.

An Overview of Innovation

In this paper, we review the different definitions of resilience and their potential application in explaining the long-term development of urban and regional economies. We reject equilibrist versions of resilience and argue instead that we should seek an understanding of the concept from an evolutionary perspective. After discussing a number of such perspectives, we focus on the adaptive cycle model from panarchy theory to generate testable hypotheses concerning urban and regional resilience. Two case study city-regional economies are used to explore this model. We conclude that the evolutionary adaptive cycle model, though not without problems, warrants further study as a framework for analysing regional economic resilience.

The economic resilience of regions: towards an evolutionary approach

Technology's contribution to economic growth and competitiveness has been the subject of vigorous debate in recent years. This book demonstrates the importance of a historical perspective in understanding the role of technological innovation in the economy. The authors examine key episodes and institutions in the development of the U.S. research system and in the development of the research systems of other industrial economies. They argue that the large potential contributions of economics to the understanding of technology and economic growth have been constrained by the narrow theoretical framework employed within neoclassical economies. A richer framework, they believe, will support a more fruitful dialogue among economists, policymakers, and managers on the organization of public and private institutions for innovation. David Mowery is Associate Professor of Business and Public Policy at the School of Business Administration, University of California, Berkeley. Nathan S. Rosenberg is Fairleigh Dickinson Professor of Economics at Stanford University. He is the author of Inside the Black Box: Technology and Economics (CUP, 1983).

Technology and the Pursuit of Economic Growth.

This paper examines the co-evolution of MNE activities and institutions external and internal to the firm. We develop a theoretical framework for this analysis that draws on the more recent writings of Douglass North on institutions as a response to complex forms of uncertainty associated with the rise in global economic interconnectedness, and of Richard Nelson on the co-evolution of technology and institutions. We link historical changes in the character of MNE activities to changes in the institutional environment, and highlight the scope for firm-level creativity and institutional entrepreneurship that may lead to co-evolution with the environment. We argue that the main drivers for institutional entrepreneurship are now found in the increasing autonomy of MNE subsidiaries. Thus MNE agency derives from more decentralized forms of experimentation in international corporate networks, which competence-creating nodes of new initiatives can co-evolve with local institutions. Unlike most other streams of related literature, our approach connects patterns of institutional change in wider business systems with more micro processes of variety generation and experimentation within and across individual firms. This form of co-evolutionary analysis is increasingly important to understanding the interrelationships between MNE activities and public policy.

An evolutionary approach to understanding international business activity: The co-evolution of MNEs and the institutional environment

This paper surveys the existing fragmentary data on the growth of university-owned patents and university-invented patents in Europe. We find evidence that university patenting is growing, but this phenomenon remains heterogeneous across countries and disciplines. We found some evidence that university licensing is not profitable for most universities, although some do succeed in attracting substantial additional revenues. This might be due to the fact that patents and publications tend to go hand in hand. In a dynamic setting however, we fear that the increase in university patenting exacerbates differences across universities in terms of financial resources and research outcome.

University Patenting and its Effects on Academic Research: the Emerging European Evidence

Science, technology and innovation policy play increasingly important roles in modern societies at many levels of development. This paper reviews the rationale for such policies and places them in the context of our understanding of the institutions and processes through which knowledge is accumulated, stored and disseminated. In particular, we contrast the market failure rationale for innovation policy with the newly developed idea of systemic failure within innovation systems as a policy rationale. The central policy question becomes can we improve upon the self-organisation of innovation systems. Wherever there are missing components or missing linkages within the innovation system then this question can be answered to the affirmative.

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Equilibrium and Evolutionary Foundations of Competition and Technology Policy: New Perspectives on the Division of Labour and the Innovation Process

Innovation in medicine is a complex process that unfolds unevenly in time and space. It is characterised by radical uncertainty and emerges from innovation systems that can hardly be comprehended within geographical, technological or institutional boundaries. These systems are instead highly distributed across countries, competences and organisations. This paper explores the nature, rate and direction of the growth and transformation of medical knowledge in two specific areas of research, interventional cardiology and glaucoma. We analyse two large datasets of bibliometric information extracted from ISI and adopt an empirical network approach to try to uncover the fine structure of the relevant micro-innovation systems and the mechanisms through which these evolve along trajectories of change shaped by the search for solutions to interdependent problems.

Networks of knowledge: The distributed nature of medical innovation

It is commonplace to say that the modern economy is knowledge based but a moment’s reflection points to the vacuity of this notion. For all economies are knowledge based and could not be otherwise. The question is rather how is one kind of knowledge based economy to be distinguished from another? This essay proposes that the answer may lie in three directions: (1) in terms of the variety of knowledge that is engaged; (2) in terms of the processes by which the production of knowledge is organised, and its corollary the resources devoted to knowledge production and dissemination; and, (3) in terms of the purposes to which knowledge is put. In respect of each of these dimensions, the rise of the modern university as a custodian of knowledge in Western economy and society has been of central importance; but universities are not alone in this role, a wide range of other agencies, private firms, public research laboratories for instance play an important role in defining a knowledge economy and have done so increasingly since the turn of the nineteenth century—a first indication of the systemic dimensions of a modern knowledge economy.

University and business relations: Connecting the knowledge economy

Post-innovation performance

This paper considers the optimality properties of a market economy in terms of three propositions that evaluate the outcomes of and the process of competition between a population of firms working within a given economic environment. We show that when firms differ in more than one competitive characteristic then competition does not select in general the most efficient firm nor does it always result in increases in the average efficiency with which resources are utilized. Drawing upon a theorem of Kimura, however, we show that competition has the property of maximizing the rate of change of the average selective characteristics in the population. We conclude that a more nuanced appraisal of the institutions of the competitive process is surely necessary. From an evolutionary standpoint, the outcomes of competition are always contingent on the nature of the selection environment and the characteristics of the whole population of firms that are being selected.

J. Stanley Metcalfe

Papers

Equilibrium and Evolutionary Foundations of Competition and Technology Policy: New Perspectives on the Division of Labour and the Innovation Process

Networks of knowledge: The distributed nature of medical innovation

University and business relations: Connecting the knowledge economy

Post-innovation performance

On the Optimality of the Competitive Process: Kimura's Theorem and Market Dynamics