Innovation, technological capability and competitiveness: catching-up policy issues in evolutionary perspective: From low-level equilibrium traps to sustainable, innovation-based, competitive advantages

Abstract

Effective competence building policies rely on the evolving interaction between business innovation, knowledge systems and policy learning. In conjunction, they amount to a collective enterprise within which the mastering of the interplay between the public and private dimensions of knowledge is key. Incentives to the development of business innovation cannot yield success in the absence of social and policy capability development (Sercovich and Dolun). But this cannot take place at once. Countries acquire these capabilities along variegated long-term trajectories. Some common features can, however, be discerned for purposes of policy development. A stylized conceptual framework on this is submitted and illustrated in this paper and the respective implications discussed. In this paper we pursue three specific objectives: i. Submit an evolutionary view of long-term structural change ii. Present and illustrate the basic elements of a systems evolutionary perspective to innovation and technological policy-making, taking both capability building and other dynamic factors on board; and iii. Demonstrate applications of the framework. The systems evolutionary perspective presently adopted seems particularly suitable to address knowledge-based economic growth in the present phase of globalization.