Knowledge that Transforms

Although multinational enterprises (MNEs) from advanced economies have increasingly internationalised their innovation activities, including RD (2) the effectiveness of these strategies related to the combined and complementary use of various STI/DUI learning mechanisms over time, which supported the technological capability-building process and, ultimately, the implementation of innovation activities with increased value and novelty. By using a comprehensive and integrative approach to interactive learning, examining how such learning affects the subsidiary's accumulation of innovation capability ‘levels’ and adopting a micro-level perspective in a host emerging economy, we contribute to furthering the understanding of knowledge-seeking strategies and innovation in MNE-subsidiaries, from the standpoint of biotechnology. We also provide a basis for deepening the analysis of interactive learning in subsidiaries in other industries and other emerging economies.

This paper estimates the effect of a skilled visa program that permits foreign-born graduates from Australian universities the right to temporarily live and work in Australia post-graduation on regional innovation outcomes. Our analysis combines data on innovation measures at the regional level with administrative data from the full population of approved Temporary Graduate visa applications. The empirical strategy accounts for the potential bias introduced by skilled foreign-born students sorting into innovative regions by using an instrumental variables strategy. Results show a positive impact of the visa program on the number of patent applications, indicating a positive impact of the skilled immigration visa program on regional innovation. We find no impact of the Temporary Graduate Visa program on the number of design rights or trademarks.

Any major socio-technical transition requires a fundamental re-direction of financial capital from incumbent to new technologies and practices. While the transitions literature conceptually covers financial markets, the role of finance is marginalized and has scarcely been analysed empirically. To address this gap, here we build on the multi-level perspective (MLP), which considers financial markets as part of the existing regime. We argue that the role of finance is highly relevant for the niche-regime interaction: Redirecting finance towards new niche technologies requires that either the niche is fit for and conforms to the financial regime's expectations or the financial regime is stretched and transformed in order to accept and finance niche technologies. Based on 56 interviews, we identify factors that determine interactions between the financial regime and technology niches: these include acceptable risk and transaction size, an abundance of knowledge and heuristics in both the regime and niche, and an extensive, existing industry network. We further analyse how State Investment Bank (SIB) interventions in Germany, the UK and Australia, aimed to mobilise private finance into low-carbon project development, affect the interaction between the technology niche and financial regime, i.e. whether they resulted in fitting-and-conforming the technological niche for the financial regime or stretching-and-transforming the financial regime. Our results point to several important effects of SIB interventions, with most effects fitting the niche to the regime. However, we also detect effects that stretch and transform the financial regime – through evolutionary processes. Importantly, some effects occur as a consequence of the primary effects. Based on our findings we discuss policy implications on how to accelerate transitions through policies aiming at finance as well as theoretical insights gained through our analysis.

A key challenge in sustainability transitions research is to better understand the huge variety and spatial unevenness of transitions paths. Institutions and institutional change have been identified as critical issues, as regional institutional settings significantly influence the pace and scope of sustainability transitions. However, the complex institutional dynamics underpinning 'Regional Transition Paths to Sustainability' (RTPS) are not well understood. Underexplored is in particular the link between short time gradual changes on the micro-level and long-term transformative change on the system level. In order to add to a more profound understanding of these processes, a focus on organizational change is valuable. The basic argument made in this article is that the emergence of new temporary and more permanent forms of organization has the potential to enable de-institutionalization and new institutionalization processes simultaneously. As we will show, new organizational forms also serve as a means to make institutional dynamics visible. The contribution of this paper is thus twofold: By combining insights from sustainability transition theory, evolutionary economic geography and neoinstitutional organization theory, we develop an original conceptual framework. By developing and applying the methodological approach of a 'transition topology', the potential of this framework for comparative research on actors and processes in different regional transition path to sustainability is revealed.

Africa is a continent facing severe, urgent, and often unique health challenges. At the same time, in most African countries, national research funding is very limited and research systems are usually dependant on international research funding and collaboration. Therefore, in this context, there are worries that foreign partners will dominate medical research agendas, which may take research away from being relevant to specific local health needs. In this article, we investigate whether the distribution of medical research priorities and investment in medical research, across diseases in Africa, is related to the disease burden of local populations between 2006 and 2015. Our results show that, although African medical research capacity is still very weak and greatly dependant on public non-African and philanthropic funders, medical research specialisation in sub-Saharan Africa is generally associated with its disease burden. Our results are interesting because they indicate that although there are misalignments at the global level between research priorities and disease burden in absolute terms, in sub-Saharan Africa, there is no clear trade-off between participating in global research networks and producing medical research that is aligned with local health needs.

Citizen Science (CS) projects involve members of the general public as active participants in research. While some advocates hope that CS can increase scientific knowledge production (“productivity view”), others emphasize that it may bridge a perceived gap between science and the broader society (“democratization view”). We discuss how an integration of both views can allow Citizen Science to support complex sustainability transitions in areas such as renewable energy, public health, or environmental conservation. We first identify three pathways through which such impacts can occur: (1) Problem identification and agenda setting; (2) Resource mobilization; and (3) Facilitating socio-technical co-evolution. To realize this potential, however, CS needs to address important challenges that emerge especially in the context of sustainability transitions: Increasing the diversity, level, and intensity of participation; addressing the social as well as technical nature of sustainability problems; and reducing tensions between CS and the traditional institution of academic science. Grounded in a review of academic literature and policy reports as well as a broad range of case examples, this article contributes to scholarship on science, innovation, and sustainability transitions. We also offer insights for actors involved in initiating or institutionalizing Citizen Science efforts, including project organizers, funding agencies, and policy makers.

State governments in the United States often fund and support technology startups within their borders. Yet little is known about the magnitude with which these place-based policy interventions shift the performance trajectories of entrepreneurial firms. We provide new evidence based on 241 startups that compete for advanced research and technology commercialization loans between 2002 and 2008 through a Michigan-based program. Among applicants with project scores near the threshold required for funding, we find that award recipients are 20%–30% more likely to remain in business four years after the competition relative to similar companies that seek but fail to receive funding. We also find that award receipt stimulates follow-on venture capital (VC) investments in surviving companies. The VC stimulus effect is, however, disproportionately driven by subsets of firms that are very young, relatively inexperienced at external fundraising, or located outside the dominant hub of entrepreneurial activity within the state. This distinctive pattern of heterogeneous effects remains visible for follow-on R&D financing from federal government sources, and for supplemental outcome measures that use news articles to track shifts in financing and business development activities. These findings are consistent with the view that public R&D programs are particularly beneficial when frictions in private resource markets are more severe.

Innovative start-ups can create and shape new industries and generate considerable economic and societal impacts. Accordingly, a variety of policy initiatives are aimed at promoting the establishment, growth and impact of innovative start-ups. Designing such policies is a challenging task, because most start-ups fail. In addition, only a small share of those start-ups will ultimately prove to be innovative, and very few of those will eventually become high impact firms. Hence, effective policies require a better understanding of the processes by which innovative start-ups are formed, developed and create impact, as well as of the heterogeneous nature inherent to innovative start-ups along with their development trajectory. This article reviews 39 policy initiatives from around the world and classifies their approaches to the phenomenon of innovative start-ups. By relying on insights from the papers mentioned in this special issue, we develop a process framework by elaborating on (i) the antecedents of the creation of innovative start-ups, (ii) their founding characteristics, (iii) their behavior, and finally (iv) the outputs and impacts generated by them. Our framework highlights how policy initiatives, managerial issues and research approaches are conceptually different, depending on the specific stage of firm development. We conclude with implications for policy initiatives and further research.

Despite the wave of privatisation in recent decades, enterprises under government control still account for a large part of assets and employment in several countries and particularly continue to play a key role in certain network industries. We explore the potential role of State-Invested Enterprises (SIEs) as investors in innovation, with particular interest in that played by the institutional environment. We focus on the telecommunication industry, which has been affected by fundamental technological and organisational change, including liberalisation and privatisation, over the last decades but where public ownership still retains a major role. We draw on a longitudinal data set of 706 telecom companies from 91 countries over the 2007–2015 period and show that public ownership is positively correlated to patenting activity. We also find that - for both state-invested and private companies - improvements in institutional quality are positively associated with firm-level patenting, and that such a relation is stronger under public ownership. We offer an interpretation of these findings which shed new light on the role of SIEs as patient investors.

For the past century economists have proposed a suite of theories relating to industrial dynamics, technological change and innovation. There has been an implication in these models that the institutional environment is stable. However, a new class of institutional technologies—most notably blockchain technology—lower the cost of institutional entrepreneurship along these margins, propelling a process of institutional evolution. This presents a new type of innovation process, applicable to the formation and development of institutions for economic governance and coordination. This paper develops a replicator dynamic model of institutional innovation and proposes some implications of this innovation for innovation policy. Given the influence of public policies on transaction costs and associated institutional choices, it is indicated that policy settings conductive to the adoption and use of blockchain technology would elicit entrepreneurial experiments in institutional forms harnessing new coordinative possibilities in economic exchange. Conceptualisation of blockchain-related public policy an innovation policy in its own right has significant implications for the operation and understanding of open innovation systems in a globalised context.