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National innovation system

The National Innovation System (also NIS, National System of Innovation) is the flow of
technology and information among people, enterprises and institutions which is key to the
innovative process on the national level. According to innovation system theory, innovation and
technology development are results of a complex set of relationships among actors in the system,
which includes enterprises, universities and government research institutes.

Origins of term
The term National System of Innovation originated when Christopher Freeman and Bengt-Åke
Lundvall worked together in the late 1980s. Freeman's research drew heavily on political economy
of Friedrich List and his historical account of the rise of Japan as an economic superpower.
Lundvall's work explored the important social interactions between suppliers and customers and
their role in encouraging innovation in Denmark. Apart from a general definition, as above, there is
no canonical definition of national innovation systems. A few dominant definitions are listed below
(quoted in an OECD publication)[1] which overlap quite a bit:

A national system of innovation has been defined as follows:

▪ "... the network of institutions in the public and private sectors whose activities and interactions
initiate, import, modify and diffuse new technologies."[2]
▪ "... the elements and relationships which interact in the production, diffusion and use of new,
and economically useful, knowledge ... and are either located within or rooted inside the
borders of a nation state."[3]
▪ "... a set of institutions whose interactions determine the innovative performance ... of national
firms."[4]
▪ "... the national institutions, their incentive structures and their competencies, that determine
the rate and direction of technological learning (or the volume and composition of change
generating activities) in a country."[5]
▪ "... that set of distinct institutions which jointly and individually contribute to the development
and diffusion of new technologies and which provides the framework within which governments
form and implement policies to influence the innovation process. As such it is a system of
interconnected institutions to create, store and transfer the knowledge, skills and artefacts
which define new technologies."[6]
A country’s innovative performance largely depends on how these actors relate to each other as
elements of a collective system of knowledge creation and use as well as the technologies they use.
For example, public research institutes, academia and industry serve as research producers
carrying out research and development (R&D) activities. On the other hand, governments either
central or regional play the role of coordinator among research producers in terms of their policy
instruments, visions and perspectives for the future. Furthermore, in order to promote innovation
the different innovative actors must have strong links with each other based on a strong level of
trust and governments should promote and activate trust among the different innovation actors.[7]

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The links can take the form of joint research, personnel exchanges, crosspatenting, and purchase of
equipment.[1] Finally, NSI are shaped by distinct socio-cultural qualities of national communities.
Therefore, there are national trajectories of innovativeness, technology orientation and learning,
which results in each nation, either highly developed or not, having some kind of NSI, no matter if
working well or not.[8] Furthermore, the success factors of NSI have been seen by many scholars in
the creation of supportive institutions and organizations (with a key role of education) and
collaboration links Bridging Scales in Innovation Policies throughout the various elements that
constitute a NSI. Examples include public R&D and companies, as well as common objectives and
innovative cultures of agents, altogether entailing self/reinforcing progress and synergies.
Differences in the structures and strategies of NSI among various economically successful
countries indicate, however, that there is no universal best practise recipe.[8]

See also
▪ American School
▪ Diffusion of innovations
▪ Friedrich List
▪ Innovation system
▪ Knowledge Assessment Methodology by the World Bank Institute
▪ Local innovation system
▪ Military–industrial complex
▪ Quadruple and quintuple innovation helix (Q2IH) framework
▪ Relational capital
▪ Regional innovation system

Notes
1. Organisation for Economic Co-operation and Development (1997). National innovation systems
(http://www.oecd.org/dataoecd/35/56/2101733.pdf) (PDF). Paris. OCLC 901313898 (https://ww
w.worldcat.org/oclc/901313898).
2. Freeman, C. (1995). "The 'National System of Innovation' in historical perspective". Cambridge
Journal of Economics: 5–24. doi:10.1093/oxfordjournals.cje.a035309 (https://doi.org/10.109
3%2Foxfordjournals.cje.a035309). ISSN 1464-3545 (https://www.worldcat.org/issn/1464-3545).
3. Lundvall, Bengt-Åke (2010). National systems of innovation : toward a theory of innovation and
interactive learning. London: Anthem. ISBN 978-1-84331-890-3. OCLC 742616994 (https://ww
w.worldcat.org/oclc/742616994).
4. Nelson, Richard R., ed. (1993). National innovation systems : a comparative analysis. New
York: Oxford University Press. ISBN 9780195076172. OCLC 802844490 (https://www.worldca
t.org/oclc/802844490).
5. Patel, Parimal (1994). "The nature and economic importance of national innovations systems"
(https://www.econbiz.de/Record/the-nature-and-economic-importance-of-national-innovations-s
ystems-patel-parimal/10001166186). STI Review. STI review. - Paris : OECD, ISSN
1010-5247, ZDB-ID 284967-7. - 1994, p. 9-32. Paris: 9–32. ISSN 1010-5247 (https://www.worl
dcat.org/issn/1010-5247).
6. Metcalfe, S. (1995). "The Economic Foundations of Technology Policy: Equilibrium and

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Evolutionary Perspectives". Handbook of the economics of innovations and technological

change. Stoneman, Paul. Oxford, UK: Blackwell. ISBN 9780631177739. OCLC 31170120 (http
s://www.worldcat.org/oclc/31170120).
7. Chung, S (2002). "Building a national innovation system through regional innovation systems".
Technovation. 22 (8): 485–491. doi:10.1016/s0166-4972(01)00035-9 (https://doi.org/10.101
6%2Fs0166-4972%2801%2900035-9). ISSN 0166-4972 (https://www.worldcat.org/issn/0166-4
972).
8. Fromhold-Eisebith, Martina (2007). "Bridging Scales in Innovation Policies: How to Link
Regional, National and International Innovation Systems". European Planning Studies. 15 (2):
217–233. doi:10.1080/09654310601078754 (https://doi.org/10.1080%2F09654310601078754).
ISSN 0965-4313 (https://www.worldcat.org/issn/0965-4313). S2CID 154902491 (https://api.se
manticscholar.org/CorpusID:154902491).

Further reading
▪ Edquist, C. (1997), Systems of Innovation: Technologies, Institutions, and Organizations,
Pinter, London.
▪ Freeman, C. (1987), Technology and Economic Performance: Lessons from Japan, Pinter,
London.
▪ Miettinen, R. (2002), National Innovation System: Scientific Concept or Political Rhetoric, Edita,
Helsinki.
▪ Nawar, Abdel-Hameed (2005), NIS in Egypt: The Need for A Strategic Shift, Faculty of
Economics and Political Science, manuscript
▪ OECD, (1997), National Innovation Systems, OECD Publications, Paris.

External links
▪ National Innovation Systems (OECD, 1997) (http://www.oecd.org/dataoecd/35/56/2101733.pdf)

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