Enhancing Innovation Capacity

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1 Enhancing Innovation Enhancing Innovation Capacity Capacity Tugrul Temel Department of Economics and Development Research Institute Tilburg University April 5, 2007

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Tugrul Temel Department of Economics and Development Research Institute Tilburg University April 5, 2007. Enhancing Innovation Capacity. Outline. Background and Literature Conceptual framework The problem situation Applications The way forward. Background. - PowerPoint PPT Presentation

Transcript of Enhancing Innovation Capacity

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Enhancing Innovation Enhancing Innovation CapacityCapacity

Tugrul Temel

Department of Economics and Development Research Institute Tilburg University

April 5, 2007

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OutlineOutline

• Background and LiteratureBackground and Literature• Conceptual frameworkConceptual framework• The problem situationThe problem situation• ApplicationsApplications• The way forwardThe way forward

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BackgroundBackground

Subject is Information & Knowledge (I-K)Subject is Information & Knowledge (I-K)

• I-K I-K in growth models & innovation in growth models & innovation systemssystems

• Institutions & ICT useInstitutions & ICT use for innovation for innovation capacity developmentcapacity development

• Innovation capacitiesInnovation capacities for interactive for interactive learninglearning

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LiteratureLiterature

• The Solow-Swan model (1956)The Solow-Swan model (1956)

• Endogenous growth (Romer 1990)Endogenous growth (Romer 1990)- R&D as a choice variableR&D as a choice variable- In R&D-based models, innovation drives growthIn R&D-based models, innovation drives growth- R&D externalities increases economy-wide knowledge R&D externalities increases economy-wide knowledge

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• Evolutionary growth (Nelson, Winter 1974)Evolutionary growth (Nelson, Winter 1974) - role of institutions, path-dependency, uncertaintyrole of institutions, path-dependency, uncertainty- dynamic firm-specific capabilities rather than R&Ddynamic firm-specific capabilities rather than R&D- difficulty in measuring capacities at the aggregate level difficulty in measuring capacities at the aggregate level

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LiteratureLiterature

National Innovation SystemsNational Innovation Systems

Freeman 1987; Lundvall 1992; Nelson 1993; Patel and Pavitt 1994; Metcalfe 1995

Common points

- organizations interact in knowledge or technology generation, diffusion & use

- rules & regulations pattern their interactions

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The Problem SituationThe Problem Situation

EvolutionEvolution- Global/regional networks for I-K exchangeGlobal/regional networks for I-K exchange- From individual orgs to networks of orgsFrom individual orgs to networks of orgs- Agr research systems viewed within innovation Agr research systems viewed within innovation

systemssystems

Implications for individual orgsImplications for individual orgs- Link innovation strategies to wider S&T policiesLink innovation strategies to wider S&T policies- Establish partnerships with private enterprisesEstablish partnerships with private enterprises- Exploit ICT for better interaction with I-K networksExploit ICT for better interaction with I-K networks

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The problem situationThe problem situationI-K flow among a broad range of actorsI-K flow among a broad range of actors

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Linkages between any two organizations

FX Linkage between Farming and External organizations

Organizations outside NARS: Finance (B) Input Supply (I), Marketing (M), Agro-processing (Pr), Consumption (C)

Organizations in NARS: Policy (P), Research (R), Farming (F), External (X)

FX

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Conceptual Framework

Institutions

ICT use

Innovation Capacity

Facilitate

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Agricultural Innovation System Agricultural Innovation System (AIS)(AIS)

A set of public and private organizations that A set of public and private organizations that

jointly and/or individually lead to valuable jointly and/or individually lead to valuable

changes in agriculture when information & changes in agriculture when information &

knowledge are made available and are put into knowledge are made available and are put into

socially and economically productive use.socially and economically productive use.

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(1) Agricultural POLICY, legislative, regulatory structure - Ministries, regulatory & enforcement agencies

(2) Agricultural Science & Technology KNOWLEDGE Base - Agr Univ, Res-Ext orgs, NGOs for indigenous knowledge

(3) MARKET System - Farmers, Agro-processors, input suppliers, input suppliers,

marketing agents, marketing agents, consumers(4) EXTERNAL Sector - Donors,

International R&D Orgs

Goal: to reduce poverty & food insecurity

Components of an AISComponents of an AIS

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Assumptions of AIS Assumptions of AIS

• I-KI-K: central to economic growth & development: central to economic growth & development

• InteractionsInteractions: : critical for I-K flow & org. critical for I-K flow & org. learninglearning

• LearningLearning:: as important as direct investment in as important as direct investment in R&DR&D

• InnovationsInnovations: take place everywhere in society: take place everywhere in society

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Innovation CapacitiesInnovation Capacities

• Absorptive capacityAbsorptive capacity is strong if I-K is strong if I-K receivers are competent.receivers are competent.

• Linkage capacityLinkage capacity is strong if actors in is strong if actors in AIS are linked and interact.AIS are linked and interact.

• Competition capacityCompetition capacity is strong if is strong if actors invest in human capital and actors invest in human capital and learning.learning.

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InstitutionsInstitutions

rules of the game or humanly devised constraints that structure human interaction (North, 1996)

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Institutions create an enabling Institutions create an enabling environment for capacity environment for capacity

developmentdevelopment

• secure the benefits from investment in I-Ksecure the benefits from investment in I-K

• improve rate of I-K generation, diffusion, improve rate of I-K generation, diffusion, useuse

• shape the innovation process by managing

- conflicts (i.e., IPR, enforcement)

- information supply (i.e. labeling regulations)

- uncertainty (i.e. governance of natural resources)

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ICT facilitates capacity developmentICT facilitates capacity development

ICT use enhances the ICT use enhances the rate of I-K absorption, rate of I-K absorption, exchange and use.exchange and use.

ICT penetrates into ICT penetrates into the innovation system the innovation system when absorptive, when absorptive, linkage & competition linkage & competition capacities are strong.capacities are strong.

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• Mapping I-K flow in the AISMapping I-K flow in the AIS

Components:Components: policy (P), research (R), policy (P), research (R), education (E), credit (C), extension & education (E), credit (C), extension & information (I), private enterprises (M), information (I), private enterprises (M), farming (F), consultancy (D) and external farming (F), consultancy (D) and external (X)(X)

• Characterizing the AISCharacterizing the AIS

• Policy recommendationsPolicy recommendations

Application 1Application 1Information and Knowledge FlowInformation and Knowledge Flow

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Application 1Application 1Information and Knowledge FlowInformation and Knowledge Flow

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Linkages between any two organizations in the AIS

FX Linkage between Farming and External organizations

Organizations outside NARS: Finance (B) Input Supply (I), Marketing (M), Agro-processing (Pr), Consumption (C)

Organizations in NARS: Policy (P), Research (R), Farming (F), External (X)

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Cause

Effect

Application 1Application 1Cause-effect structure of the AISCause-effect structure of the AIS

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Application 2Application 2

ICT use in GeorgiaICT use in Georgia

• Goal:Goal: assess ICT infrastructure & use to facilitate assess ICT infrastructure & use to facilitate AIS for HV sectorAIS for HV sector

• Objective:Objective: identify pivotal orgs to establish an identify pivotal orgs to establish an IENIEN

• Rationale:Rationale: weak weak market participation due to weak market participation due to weak I-K exchangeI-K exchange

• ConstraintsConstraints:: Government is not transparent; Government is not transparent; pluralistic information flow has not been a traditionpluralistic information flow has not been a tradition

• Data collectionData collection:: questionnaire & Needs questionnaire & Needs Assessment InterviewsAssessment Interviews

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Application 2Application 2 Information Exchange Network

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InformationExchangeNetwork

Linkages between any two organizations in the AIS

Additional organizations in the AIS

Organizations in NARS

IInformation flow by:Information flow by:Face to Face Face to Face Meetings; Mass Media Meetings; Mass Media (Radio, Newspapers, (Radio, Newspapers, TV, Magazines); TV, Magazines); Internet/Web; Internet/Web; Telephony, Call Telephony, Call CentersCenters

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So far a methodology developedSo far a methodology developed

- To characterize the AISTo characterize the AIS

- To assess ICT useTo assess ICT use

Now the challenge is to assessNow the challenge is to assess

- the influence of I-K related institutions and ICT use the influence of I-K related institutions and ICT use on innovation capacityon innovation capacity

- the effect of changes in innovation capacity on the the effect of changes in innovation capacity on the functioning of the innovation systemfunctioning of the innovation system

The way forwardThe way forward

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Survey Design & MeasurementSurvey Design & Measurement

• Survey of organizations in the innovation systemSurvey of organizations in the innovation system– Absorption, linkage, competition capacitiesAbsorption, linkage, competition capacities - skills and qualifications of - skills and qualifications of

human resources, networking capacity, ICT use in I-K exchangehuman resources, networking capacity, ICT use in I-K exchange

− Org innovationOrg innovation – motivation for the innovation concerned; resources used; – motivation for the innovation concerned; resources used; consequences for organizational performanceconsequences for organizational performance

− Org linkageOrg linkage – nature (codified/tacit), type (coop./ partnership), strength, – nature (codified/tacit), type (coop./ partnership), strength, cost (free/subscription) of interaction with I-K sources (open/limited) cost (free/subscription) of interaction with I-K sources (open/limited)

− Characteristics of I-K flowCharacteristics of I-K flow - direction, nature (codified/tacit), strength & - direction, nature (codified/tacit), strength & means of I-K transfer (capital goods, new employees, patents, licenses)means of I-K transfer (capital goods, new employees, patents, licenses)

− Perceived degree of influencePerceived degree of influence - Org A is said to influence org B if the I-K - Org A is said to influence org B if the I-K originating from A motivates or is used in B’s innovation activitiesoriginating from A motivates or is used in B’s innovation activities

• Apply concepts and principles of systems analysis & graph Apply concepts and principles of systems analysis & graph theorytheory

• Econometrics for estimating ICT’s impact on learning/org changeEconometrics for estimating ICT’s impact on learning/org change

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Thank you…Thank you…