nep-ino New Economics Papers
on Innovation
Issue of 2006‒05‒27
25 papers chosen by
Koen Frenken
Universiteit Utrecht

  1. Breaking the Fence: Patent Rights and Biomedical Innovation in 'Technology Followers' By Gehl Sampath, Padmashree
  2. Impact of Intellectual Property Rights Reforms on the Diffusion of Knowledge through FDI By Ioana Popovici
  3. Transactions costs, innovation and learning By Nooteboom,Bart
  4. Persistence of Innovation in Dutch Manufacturing: Is it Spurious? By Mohnen, Pierre; Schim van der Loeff, S.; Palm, Franz; Raymond, Wladimir
  5. Public Research in Regional Networks of Innovators: A Comparative Study of Four East-German Regions By Holger Graf; Tobias Henning
  6. Network embeddedness and the exploration of novel technologies : technological distance, betweenness centrality and density By Nooteboom,Bart; Gilsing,Victor; Vanhaverbeke,Wim; Duysters,Geert; Oord,Ad van den
  7. Optimal cognitive distance and absorptive capacity By Nooteboom,Bart; Vanhaverbeke,Wim; Duysters,Geert; Gilsing,Victor; Oord,Ad van den
  8. Learning and innovation in inter-organizational relationships and networks By Nooteboom,Bart
  9. Capacity development for agricultural biotechnology in developing countries: Concepts, contexts, case studies and operational challenges of a systems perspective. By Hall, Andy; Dijkman, Jeroen
  10. Degree of innovativeness and market structure: A model By Daniela Grieco
  11. An Integrated Evaluation Scheme of Innovation Systems from an Institutional Perspective By Verena Bikar; Michele Cincera; Henri Capron
  12. Concepts and guidelines for diagnostic assessments of agricultural innovation capacity By Hall, Andy; Mytelka, Lynn; Oyelaran-Oyeyinka, Banji
  13. Do Process Innovations Induce Product Ones? By Maria Rosa Battaggion; Piero Tedeschi
  14. The Determinants of Pharmaceutical R&D Expenditures: Evidence from Japan By Mahlich, Jörg C.; Roediger-Schluga, Thomas
  15. Innovation Capabilities: Science and Engineering Employment in Canada and the United States By Beckstead, Desmond; Gellatly, Guy
  16. Innovation Capabilities: Comparing Science and Engineering Employment in Canadian and U.S. Cities By Beckstead, Desmond; Brown, Mark
  17. Knowledge, Profitability and Exit of German Car Manufacturing Firms By Jens J. Krüger; Kristina Dreßler
  18. Emergent theory and technology in E-learning By Marie-Joëlle Browaeys,; Stephanus Eko Wahyudi
  19. Global rules, patent power and our food future: controlling the food system in the 21st century By Geoff Tansey
  20. Knowledge and Information Networks: Evidence from an Italian Wine Local System By Andrea Morrison; Roberta Rabellotti
  21. Technological Capabilities with Different Degree of Coherence: A Comparative Study of Domestic-Oriented vs. Export-Driven Bulgarian Software Companies By Rousseva, Rossitza
  22. Capacités d'innovation : l'emploi en sciences et en génie au Canada et aux États Unis By Beckstead, Desmond; Gellatly, Guy
  23. Modularity as an Entry Strategy: The invasion of new niches in the LAN equipment industry By Stefano Brusoni; Roberto Fontana
  24. Capacités d'innovation : Comparaison de l'emploi en sciences et en génie dans les villes canadiennes et américaines By Beckstead, Desmond; Brown, Mark
  25. A Knowledge Economy Paradigm and its Consequences By Soete, Luc

  1. By: Gehl Sampath, Padmashree (United Nations University, Maastricht Economic and social Research and training centre on Innovation and Technology)
    Abstract: The impact of patent protection on biomedical innovation has been a controversial issue. Although a "medical anti-commons" has been predicted due to a proliferation of patents on upstream technologies, evidence to test these concerns is only now emerging. However, most industrial surveys that shed light on this issue are mainly from developed countries, making it very difficult to predict the impact of patenting on biomedical innovation in developing and least developed countries. This paper develops a framework of analysis for the impact of patent rights on biomedical innovation in "technology follower" developing countries. Based on the framework developed in the paper, empirical data collected in an industry-level survey of the Indian pharmaceutical industry between November 2004 and January 2005 is used to analyze the impact of patent rights as recognized under the Agreement on Trade Related Aspects of Intellectual Property Rights (TRIPS Agreement) on biomedical innovati on in technology followers.
    Keywords: intellectual property rights, trade agreements, TRIPS, biotechnology, pharmaceutical industry, patents, innovation
    JEL: O34 O31 L65 F13
    Date: 2006
  2. By: Ioana Popovici (Department of Economics, Florida International University)
    Abstract: This paper examines the impact of intellectual property rights (IPR) reforms on the technology flows between the U.S. and countries where U.S. multinationals have established affiliates. We use patent citations as a proxy for knowledge spillovers to examine whether the diffusion of new technology between the host countries and the U.S. is accelerated by the reforms. We test the hypothesis that strengthening patent protection facilitates knowledge flows (in the form of patent citations) between U.S. multinationals and their subsidiaries in the reforming countries and between other U.S. firms and reforming countries domestic firms. Our results suggest that the reforms favor innovative efforts of domestic firms in the reforming countries rather than U.S. affiliates efforts. In other words, reforms mediate the technology flows from the U.S. to the reforming countries.
    Keywords: intellectual property rights, patents, spillovers, R&D, FDI
    JEL: O30 O34 F23
    Date: 2006–05
  3. By: Nooteboom,Bart (Tilburg University, Center for Economic Research)
    Keywords: transaction costs;innovation;learning;inter-organizational relations;networks
    JEL: L14 L22 L24 O31 O32 Z13
    Date: 2006
  4. By: Mohnen, Pierre (United Nations University, Maastricht Economic and social Research and training centre on Innovation and Technology); Schim van der Loeff, S. (University of Maastricht, Department of Quantitative Economics); Palm, Franz (University of Maastricht, Department of Quantitative Economics); Raymond, Wladimir (University of Maastricht, Department of Quantitative Economics)
    Abstract: This paper studies the persistence of innovation and the dynamics of innovation output in Dutch manufacturing using firm data from three waves of the Community Innovation Surveys (CIS), pertaining to the periods 1994-1996, 1996-1998, and 1998-2000. We estimate by maximum likelihood a dynamic panel data type 2 tobit model accounting for individual effects and handling the initial conditions problem. We find that there is no evidence of true persistence in achieving technological product or process innovations, while past shares of innovative sales condition, albeit to a small extent, current shares of innovative sales.
    Keywords: Dynamic panel data type 2 tobit, Innovation, Spurious persistence
    JEL: C33 C34 O31
    Date: 2006
  5. By: Holger Graf (University of Jena, Faculty of Economics); Tobias Henning
    Abstract: Universities and public research organizations are said to be an integrative and essential element of a functioning innovation system as they play a vital role not only in the generation of new technological knowledge, but also in its diffusion. We analyse four East German local networks of innovators which differ in structure and innovative performance and investigate the characteristic role of public research within these local systems by applying methods of social network analysis. Our results show that universities and non-university institutions of public research are key actors in all regional networks of innovators both in terms of patent output and in terms of centrality of their position in the networks. Further we find the 'thicker' networks to have more central public research organizations. Higher centrality of public research compared to private actors may be due to the fact that universities are explicitly designed to give away their knowledge and that they increasingly face the need to raise external funds.
    Keywords: Innovator Networks; Public research; R+D Cooperation; Mobility
    JEL: O31 Z13 R11
    Date: 2006–05–24
  6. By: Nooteboom,Bart; Gilsing,Victor; Vanhaverbeke,Wim; Duysters,Geert; Oord,Ad van den (Tilburg University, Center for Economic Research)
    Abstract: In this paper we analyze the innovative performance of alliance networks as a function of the technological distance between partners, a firm's network position (centrality) and total network density. We study how these three elements of an alliance network, apart and in combination, affect the 'twin tasks' in exploration, namely novelty creation on the one hand and its efficient absorption on the other hand. For an empirical test, we study technology-based alliance networks in the pharmaceutical, chemical and automotive industry.
    Keywords: innovation networks;cognitive distance;centrality;density
    JEL: O31 O32 L14 L24 L25
    Date: 2006
  7. By: Nooteboom,Bart; Vanhaverbeke,Wim; Duysters,Geert; Gilsing,Victor; Oord,Ad van den (Tilburg University, Center for Economic Research)
    Abstract: In this paper we test the relation between cognitive distance and innovation performance of firms engaged in technology-based alliances. The key finding is that the hypothesis of an inverted U-shaped effect of cognitive distance on innovation performance of firms is confirmed. Moreover, as expected, we found that the positive effect for firms is much higher when engaging in more radical, exploratory alliances than in more exploitative alliances. The effect of cumulative RD turns out to be mixed. It may increase absorptive capacity, as expected, but there is clear evidence that it also reduces the effect of cognitive distance on novelty value.
    Keywords: innovation;inter-firm alliances;cognitive distance;absorptive capacity; exploration and exploitation
    JEL: D21 L14 L22 L24 O31 O32
    Date: 2006
  8. By: Nooteboom,Bart (Tilburg University, Center for Economic Research)
    Abstract: This paper gives a survey of insights into inter-firm alliances and networks for innovation, from a constructivist, interactionist perspective on knowledge, which leads to the notion of 'cognitive distance'. It looks at both the competence and the governance side of relationships. Given cognitive distance, organizations need to align cognition sufficiently to enable the fast and efficient utilization of opportunities from complementary capabilities. This, I propose, is done by means of a culturally mediated 'organizational cognitive focus'. The problem with that is that it yields a greater or lesser organizational myopia that, for the sake of innovation, needs to be complemented by means of outside relations with other firms, at larger cognitive distance. Hence the importance of networks for innovation. On the governance side, the paper gives a review of relational risks and instruments to manage them. Next to the effects of cognitive distance, the paper analyses the effects of density and strength of ties in innovation networks, concerning both competence and governance.
    Keywords: inter-organizational relationships;networks;competence;governance;innovation; cognitive distance
    JEL: D23 L14 L22 O31 O32 Z13
    Date: 2006
  9. By: Hall, Andy (United Nations University, Maastricht Economic and social Research and training centre on Innovation and Technology); Dijkman, Jeroen (CGIAR)
    Abstract: There are divergent views on what capacity development might mean in relation to agricultural biotechnology. The core of this debate is whether this should involve the development of human capital and research infrastructure, or whether it should encompass a wider range of activities which also include developing the capacity to use knowledge productively. This paper uses the innovation systems concept to shed light on this discussion, arguing that it is innovation capacity rather than science and technology capacity that has to be developed. The context of deploying biotechnology in developing countries is illustrated with an over view of Uganda and Ethiopia. The then presents 6 examples of different capacity development approaches. It concludes by suggesting that policy needs to take a multidimensional approach to capacity development in line with an innovation systems perspective. But it also argues that policy needs to recognise the need to develop the capacity of diversity of innovation systems and that a key part of the capacity development task is to bring about the integration of these different systems at strategic points in time. The paper concludes with a tentative typology of the main types of agricultural innovation systems that are likely to be important in developing countries.
    Keywords: agriculture, Ethiopia, Uganda, innovation systems, biotechnology, capacity building, innovation policy.
    JEL: O13 O2 O31 O38
    Date: 2006
  10. By: Daniela Grieco (CESPRI, Bocconi University, Milano,Italy.)
    Abstract: A limited number of business firms engage in disruptive innovative activity. When firms decide among alternative innovative patterns, inertial forces may bias their choices in favour of incremental innovations. This paper proposes a model that compares firms’ value when firms can invest in strategies implying different degrees of innovativeness. The model shows that incremental strategies emerge as a dominant strategy for oligopolists when imitation of incremental innovation is sufficiently slow and firms are not too asymmetric in their access to knowledge. If these conditions are not respected, the model exhibits an additional symmetric Nash equilibrium where firms select radical innovations.
    Keywords: Radical innovation, Incremental Innovation, Imperfect competition, Patent race.
    JEL: D21 D81 L20 O33
    Date: 2006–04
  11. By: Verena Bikar (DULBEA-CERT, Université libre de Bruxelles, Brussels); Michele Cincera (DULBEA-CERT, Université libre de Bruxelles, Brussels, and CEPR); Henri Capron (DULBEA-CERT, Université libre de Bruxelles, Brussels)
    Abstract: This paper aims at proposing an original framework for the mapping of innovation systems. The analytical outline is based on the following paradigm: the innovation process has commonly been accepted as a complex system of interactions between different institutions aimed to achieve specific objectives through the efficient implementation of public instruments. More specifically, the objective of this paper consists, in a first step, in identifying and defining these innovation concepts. In a second step, the STI mapping is evaluated by crossing the STI objectives, instruments and institutional actors into four functional matrices that should all together empirically depict the innovation system. In order to strengthen the validity of the approach, an empirical example implemented at the EU-15 level is presented. The approach is based on the respect of the four following criteria: 1) international comparability of results; 2) representativeness of results; 3) measurement issues; and 4) consistency of the approach.
    Keywords: Innovation Systems, Innovation Objectives, Innovation Governance, Institutional Set-up
    JEL: O31 O38
    Date: 2006–05
  12. By: Hall, Andy (United Nations University, Maastricht Economic and social Research and training centre on Innovation and Technology); Mytelka, Lynn (United Nations University, Maastricht Economic and social Research and training centre on Innovation and Technology); Oyelaran-Oyeyinka, Banji (United Nations University, Maastricht Economic and social Research and training centre on Innovation and Technology)
    Abstract: This paper is divided into two parts. The first part sets out a conceptual framework for diagnostic assessments of agricultural innovation capacity. It explains that contemporary patterns of agricultural development demand fresh thinking on how innovation can be promoted in ways that can deal with rapidly evolving production and market conditions. The innovation systems concept is presented as a framework for examining the notion of innovation capacity. The second part of the paper provides guidance on how the principles of this conceptual framework can be used in diagnostic assessments. These guidelines include a number of typological tools to explore the qualitative aspects of innovation capacity – particularly patterns of interaction and the habits and practices that inform these.
    Keywords: Public Private Sector Partnerships, Innovation Systems, Institutional Change, Capacity Development, Social Capital
    JEL: Q16 O31 O33 O15
    Date: 2006
  13. By: Maria Rosa Battaggion; Piero Tedeschi
    Abstract: We study the relationship between process and product innovations in vertically differentiated duopolies. A process innovation can lead two competing firms to improve the quality of their goods introducing a product innovation. In fact, a cost reducing innovation has two effects: it spurs production and it enhances price competition. The former effect induces both firms to increase quality. The latter encourages differentiation, inducing low quality firm to decrease it. Therefore, high quality firm always improves its quality, while the other may or may not. The prevailing effect depends on the nature of quality costs (fixed or variable).
    Keywords: Process Innovation, Product Innovation
    JEL: D43 O33
  14. By: Mahlich, Jörg C. (Wirtschaftskammer Österreich); Roediger-Schluga, Thomas (ARC Systems Research)
    Abstract: During the past 20 years, the world pharmaceutical industry has experienced a dramatic increase in R&D intensity. We apply and extend a model developed by Grabowski and Vernon (2000) with a pooled data sample of the 15 publicly listed Japanese drug firms for the period 1987 to 1998. As in the reference paper, we find expected returns to be an important determinant of R&D spending in the Japanese drug industry, albeit considerably smaller than in the U.S., which is particularly obvious in the case of returns from newly introduced drugs. However, our results are sensitive to econometric model specification, in particular to controlling for serial correlation and to a dynamic specification of the baseline model. Likewise, estimates on financial constraints are sensitive to model specification, indicating that Japanese drug firms face small or no financial constraints. Our results are consistent with the general literature on R&D investment behaviour, yet raise some methodological questions with regard to the original study.
    Keywords: R&D, investment, panel data estimation, pharmaceuticals, Japan
    JEL: L65 O31 O33
    Date: 2006
  15. By: Beckstead, Desmond; Gellatly, Guy
    Abstract: This paper compares the size and composition of science and engineering employment in Canada and the United States. It examines the share of paid employment and paid earnings accounted for by the science and engineering workforce in both countries. Our tabulations distinguish between a core group and a related group of science and engineering workers. The core group includes computer and information scientists, life and related scientists, physical and related scientists, social and related scientists, and engineers. The related group includes workers in health-related occupations, science and engineering managers, science and engineering technologists and technicians, a residual class of other science and engineering workers, and post-secondary educators in science and engineering fields. We examine the employment and earnings shares of science and engineering workers over the 1980/1981 to 2000/2001 period. Detailed industry comparisons are reported for 2000/2001.
    Keywords: Labour, Science and technology, Occupations, Innovation
    Date: 2006–05–04
  16. By: Beckstead, Desmond; Brown, Mark
    Abstract: In recent years, cities have become increasingly interested in their ability to generate, attract and retain human capital. One measure of human capital is employment in science- and engineering-based occupations. This paper provides a comparison of the employment shares of these specialized occupations across Canadian and U.S. cities by using data from the Canadian and the U.S. censuses from 1980-1981 and 2000-2001. The paper, therefore, provides a perspective on how Canadian cities performed relative to their U.S. counterparts over a twenty-year period. It also seeks to evaluate how cities of different sizes have performed, because large cities may be advantaged over smaller cities in terms of factors influencing both the demand for, and supply of, scientists and engineers.
    Keywords: Labour, Science and technology, Occupations, Innovation
    Date: 2006–05–11
  17. By: Jens J. Krüger (University of Jena, Faculty of Economics); Kristina Dreßler (University of Jena, Faculty of Economics)
    Abstract: In this paper the profitability of German car manufacturing firms is related to different indicators for the knowledge incorporated in the firms since the birth of the industry in 1886. The analysis is performed with an ordered probit model, where information about the kind of exit of the firms is exploited to construct a latent profitability variable. Knowledge is represented by the number of patents, learning-by-doing and entrepreneurial experience before entry. The results show that knowledge is significantly positively related to firm profitability and that each of the three knowledge forms exerts an independent effect.
    Keywords: firms profitability, exit modes, knowledge, ordered choice, automobile industry
    JEL: L10 L21 L62 O33 C25
    Date: 2006–05–20
  18. By: Marie-Joëlle Browaeys,; Stephanus Eko Wahyudi (Nyenrode Business Universiteit)
    Abstract: E-learning should be approached via a new paradigm, one where instruction and information are involved in a recursive process, an approach which counters the concept of linearity. New ways of thinking about how people learn and new technologies favour the emergence of principles of e-learning that deliver both business and individual opportunities. In this paper we develop a vision of what learning will look like in the future and a clearer idea of technological opportunities for the promotion of new e-learning.
    Keywords: e-learning, learning, knowledge, technology, paradigm, complexity
    Date: 2006
  19. By: Geoff Tansey
    Abstract: The rules affecting our food future have been rewritten since the early 1990s, often in remote international bodies. This paper briefly outlines the nature of today's food system, discusses some of these rules and focuses on the dynamics of rule making in the World Trade Organisation, in particular around patent, plant variety protection, trademark, copyright and other forms of 'intellectual property' and their impact on our food future. It draws on work with negotiators dealing with the Trade-Related Aspects of Intellectual Property Rights Agreement (TRIPS) in WTO and its role in globalisation.
    Keywords: Intellectual property rights regimes, WTO, patents, biotechnology
    JEL: L66 Q16
    Date: 2006–05–22
  20. By: Andrea Morrison (CESPRI and Department of Economics and Quantitative Methods, Università Bocconi, Milano and Università del Piemonte Orientale, Novara, Italy); Roberta Rabellotti (Department of Economics and Quantitative Methods, Università del Piemonte Orientale, Novara, Italy)
    Abstract: A well-grounded empirical and theoretical literature shows that local production systems can benefit from external economies generated by a shared ‘industrial atmosphere’. Many scholars would agree that in contexts as industrial districts, clusters and local systems, economic actions are strongly embedded in social and institutional factors. Nevertheless, many scholars would instead debate about the nature, boundaries and processes underpinning ‘industrial atmosphere’. This paper aims at contributing to this field of studies by entering into the black box of the ‘industrial atmosphere’ reconstructing the informal contacts underpinning collective learning in a local production system. The study is based on empirical evidence collected at firm level in an Italian wine local system and uses methods of network analysis.
    Keywords: Social Networks, Knowledge, Industrial Clusters, Wine Sector
    JEL: O31 R10 Z13
    Date: 2005–09
  21. By: Rousseva, Rossitza (SPRU, University of Sussex)
    Abstract: The paper makes an attempt to examine systematically the capabilities for software production in a latecomer context and to propose an approach for analysing the technological capabilities (TC) in a latecomer software industry. Taking the analysis one step further than identifying capabilities, the study introduces the notion of coherence of TC and suggests that in analysing the TC the analysis needs to take into account also the coherence among the capabilities. The analysis of the accumulation of individual TC in the Bulgarian software industry reveals that significant differences emerge between the TC of domestic-oriented vs. the export-driven companies. The analysis of the coherence of TC proves capable of disentangling the deeper disparities in the accumulation of capabilities and it reveals that strong coherence occurs only in ‘export’ TC. The paper concludes by bringing back the discussion about the prospects and the entry strategies for developing latecomer software industries. Based on the results the study contests the ‘walking on two legs’ hypothesis and also points that the optimistic forecasts about the possibilities for leapfrogging by the latecomer countries by developing indigenous software industries have been overestimated.
    Keywords: technological capabilities, software industry, leapfrogging
    JEL: O14 O32
    Date: 2006
  22. By: Beckstead, Desmond; Gellatly, Guy
    Abstract: Le présent article donne la comparaison de la taille et de la composition de l'emploi dans le secteur des sciences et du génie au Canada et aux États Unis. Nous examinons la part de l'emploi rémunéré et des gains tirés d'un emploi rémunéré imputables à la main d'oeuvre en sciences et en génie dans les deux pays. Nos totalisations font la distinction entre un groupe de base et un groupe connexe de travailleurs en sciences et en génie. Le groupe de base comprend les informaticiens, les spécialistes des sciences de la vie et sciences associées, les spécialistes des sciences physiques et sciences associées, les spécialistes des sciences sociales et sciences associées, et les ingénieurs. Le groupe connexe comprend les travailleurs du secteur de la santé, les directeurs des services de sciences et de génie, les technologistes et les techniciens des services de sciences et de génie, une catégorie résiduelle d'autres travailleurs en sciences et en génie et les enseignants du niveau postsecondaire en sciences et en génie. Nous examinons les parts de l'emploi et des gains des travailleurs en sciences et en génie au cours de la période allant de 1980 1981 à 2000 2001. Nous présentons des comparaisons détaillées par industrie pour 2000 2001.
    Keywords: Travail, Science et technologie, Professions, Innovation
    Date: 2006–05–04
  23. By: Stefano Brusoni (CESPRI and CRORA, Università Bocconi, Milano and Silvio Tronchetti- Provera Foundation, Italy); Roberto Fontana (CESPRI, Università Bocconi, Milano and Department of Economics, University of Pavia, Italy)
    Abstract: This paper focuses on niche entry patterns in the LAN equipment industry in the 1990s. We analyze an original data-set of LAN equipment consisting of more than 1,000 hubs and switches marketed between 1990 and 1999. Modularity emerged as a design strategy that supported incumbent firms’ efforts to enter new product niches in the hub segment. However, after the emergence of switches as an alternative to hubs, coupled with the introduction of a new standard, incumbents relying on a modular hub strategy were overtaken by a new comer (Cisco). Moreover, the fastest followers were incumbents that had not previously relied on modular hub architectures. Our interpretation is as follows: modularity offers advantages of speed when changes occur within established boundaries. However, it also generates a ‘tunnel effect’ that prevents firms from developing products based on different problem-solving strategies. Such changes are more easily introduced by firms that do not rely on tightly-defined modular design rules.
    Keywords: Entry; Modularity; LAN Equipment
    JEL: O33 L63 D83
    Date: 2005–07
  24. By: Beckstead, Desmond; Brown, Mark
    Abstract: Ces dernières années, les villes ont accordé un intérêt croissant à leur capacité de générer, d'attirer et de retenir leur capital humain. Une mesure de ce capital est l'emploi dans les professions liées aux sciences et au génie. Nous comparons la part de l'emploi attribuable à ces professions spécialisées dans les villes canadiennes et américaines en nous fondant sur des données tirées des recensements de la population du Canada et des États Unis réalisés de 1980-1981 à 2000-2001. Cette comparaison donne une idée de la performance des villes canadiennes relativement à leurs analogues américaines au cours d'une période de vingt ans. Nous cherchons aussi à évaluer les résultats des villes en fonction de leur population, parce que les grandes villes pourraient être plus favorisées que les petites en ce qui a trait aux facteurs ayant une incidence sur la demande ainsi que l'offre de scientifiques et d'ingénieurs.
    Keywords: Travail, Science et technologie, Professions, Innovation
    Date: 2006–05–11
  25. By: Soete, Luc (United Nations University, Maastricht Economic and social Research and training centre on Innovation and Technology)
    Abstract: During the 1980s and 1990s "Active labour" market reforms opened up labour markets in Europe, making them more flexible without putting in jeopardy the essence of the social security protection model. Countries that went furthest in such "active labour" market reforms such as the UK, the Scandinavian countries, and the Netherlands witnessed not just reductions in unemployment, but also impressive increases in employment participation rates, particularly among underrepresented groups in the labour market. The challenge today appears more or less similar, but this time with respect to knowledge. Interestingly, it is those EU Member States that have succeeded most in "activating" their labour markets and developing better functioning social welfare models that have performed best in terms of knowledge investments. This suggests, that success in boosting knowledge investment generates the public resources for the development of social welfare models capable of addressing rapid change, and in particular the global changes of the 21st Century.
    Keywords: Knowledge, Human Capital, Investment, Social Welfare, Technological Change, Social Change, Globalisation
    JEL: O31 O38 O15 I38 J61
    Date: 2006

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