National Innovation Systems is the network of institutions in the public and private sectors whose activities and interactions initiate, import, modify and diffuse new technologies.

1. By Thanakrit Lersmethasakul
Email: lersmethasakul@live.com
National
Innovation
Systems

2. Definitions
“ .. the network of institutions in the public and private sectors whose
activities and interactions initiate, import, modify and diffuse new
technologies.” (Freeman, 1987)
“ .. 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.” (Lundvall, 1992)
“... a set of institutions whose interactions determine the innovative
performance ... of national firms.” (Nelson, 1993)

3. “ .. 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.” (Patel and Pavitt, 1994)
“.. 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.”
(Metcalfe, 1995)

4. National Innovation System (NIS) use to help
policy makers develop approaches for
enhancing innovative performance in the
knowledge-base economies of today

5. Enterprises Universities Research Institutes
How the various actors in a country interact in
the innovation process ?

6. The smooth operation depends on the fluidity
of knowledge flows among the actors.
Tacit knowledge
(know-how exchanged
through informal channels)
Codified knowledge
(publication, patents, other sources)

7. Technology Performance depends to
the interactions or linkages among the actors
involved in innovation.

8. Innovative Performance depends to
a large extent 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.

9. From NIS to Knowledge-based Economy
Focal point of work
- Identifying best practices
- Develop indicators to map knowledge flows
- Measuring institutional linkages, human
resource flows, industrial clusters and
innovative firm behaviours.

10. Actors and linkages in the innovation system
(Source: OECD, Managing National Innovation Systems, 1999)

11. Innovation and technical progress are the
result of a complex set of relationships
among actors producing, distributing and
applying various kinds of knowledge.

12. Activities and Functions within NIS
Identification of the “functional boundaries” of an NIS, beyond
the “overall function of producing, diffusing and using innovations”.
Johnson and Jacobsson (2000) outline five primary functions:
• Create ‘new’ knowledge
• Guide the direction of the search process
• Supply resources, i.e. capital and competence
• Facilitate the creation of positive external economies (in the form
of an exchange of information, knowledge, and visions)
• Facilitate the formation of markets

13. Activities and Functions within NIS
Other researchers have provided a somewhat expanded list including:
• to create human capital
• to create and diffuse technological opportunities
• to create and diffuse products
• to incubate in order to provide facilities, equipment, and administrative support
• to facilitate regulation for technologies, materials, and products that may
enlarge the market and enhance market access
• to legitimize technology and firms
• to create markets and diffuse market knowledge
• to enhance networking
• to direct technology, market, and partner research
• to facilitate financing
• to create a labor market that (can be utilized)

14. The Mechanism for Knowledge Flows include
- Joint industry activities
- Public/private sector interactions
- Technology diffusion
- Personnel mobility

15. The Assessment of Joint industry activities
- The importance of collaborative enterprise activities -
Products changed during the last three years as a share
of sales by industry.

16. The Assessment of Public/private sector interactions
- Joint research activities - the number of joint research and
technical activities between firms and universities/research
institutes.
- Co-patents and co-publications - the number of co-patents or co-publications
developed by enterprises in collaboration with a
university or research institute.
- Citation analysis - the practice of users of technical knowledge
and ideas to cite their sources.
- Firm surveys - Sources of knowledge useful in their innovative
activities.

17. The Assessment of Technology diffusion
- Firm surveys – the use of advanced manufacturing technologies
or information technologies, the adoption rates of new
technologies, the use of specific technologies in industry.

18. The Assessment of Personnel mobility
- Firm surveys – the skills and networking capabilities of personnel,
mobility of personnel.

19. The Analytical Approaches include
- Innovation surveys (Firm-level)
- Cluster interactions
- International knowledge flows

20. Innovation Surveys (Firm-level)
To analyze sources of knowledge of firms relevant to innovation.

21. The Questions of Innovation Surveys (Firm-level)*
- Expenditure on activities related to product innovation
- Outputs and sales of new or improved products
- Sources of information relevant to innovation
- Technology transfer and acquisition
- R&D performance and technological collaboration
- Perceptions of factors promoting or hampering innovation
*Community Innovation Survey

22. Cluster Interactions
To analyze knowledge flows in national innovation systems in
recognition of the close interaction between certain types of firms
and industries.
- Key technologies
- Shared knowledge or skills
- Producer or supplier relationships

23. International Knowledge Flows
To analyze country-level interactions in creating a climate for
innovation.
- Technology acquired from abroad in capital and intermediate goods
- Purchases of foreign patents and licenses
- Technical alliances between firms of different countries
- Trade in services such as technical consultancies
- Foreign direct investment
- Internationally co-authored publications

24. The NIS Project
The NIS project has evolved along two tracks:
1. General analysis
- A comparison of national innovation systems based on a
standardised set of quantitative indicators and information on
countries’ institutional profiles.
- The production of country reports on national patterns of
knowledge flows and related aspects of innovation processes.
2. Focus groups
Advanced methodologies, data sets, or special research/policy
interests co-operating in the following six areas: Innovative firms,
Innovative firm networks, Clusters, Mobility of human resources,
Organisational mapping, Catching-up economies.

25. Reference : - ORGANISATION FOR ECONOMIC CO-OPERATION AND DEVELOPMENT
- National Innovation Systems Overview and Country Cases by Stephen Feinson