Handbook of Innovation Policy Impact

Handbook of Innovation Policy Impact

Eu-SPRI Forum on Science, Technology and Innovation Policy series

Edited by Jakob Edler, Paul Cunningham, Abdullah Gök and Philip Shapira

Innovation underpins competitiveness, is crucial to addressing societal challenges, and its support has become a major public policy goal. But what really works in innovation policy, and why? This Handbook, compiled by leading experts in the field, is the first comprehensive guide to understanding the logic and effects of innovation polices. The Handbook develops a conceptualisation and typology of innovation policies, presents meta-evaluations for 16 key innovation policy instruments and analyses evidence on policy-mix. For each policy instrument, underlying rationales and examples are presented, along with a critical analysis of the available impact evidence. Providing access to primary sources of impact analysis, the book offers an insightful assessment of innovation policy practice and its evaluation.

Chapter 15: The impact of regulation on innovation

Knut Blind

Subjects: business and management, organisational innovation, economics and finance, economics of innovation, innovation and technology, economics of innovation, innovation policy, organisational innovation

Abstract

Regulatory framework conditions have been identified as important factors influencing the innovation activities of companies, industries and whole economies. Using an endogenous growth approach this chapter delivers a conceptual analysis of the impacts of economic, social and institutional regulations on innovation. Economic regulations tend to keep a high level of competitive pressure, which forces companies to realise innovations. Social regulations mainly addressing negative external effects have strong impacts on the direction of innovation activities towards the protection of the environment, the health and safety of citizens and the like. The chapter also presents some evidence on the very heterogeneous institutional regulations, including mixed evidence on the innovation effects of intellectual property rights. Overall, the evidence on the impact of different types of regulation on innovation is patchy regarding the type of regulation, the sectors, the companies and the time horizon of the impacts. In general, the short-term impacts of regulations are often negative for innovation, in contrast to their often positive long-term implications. The chapter highlights research gaps such as the lack of appropriate indicators of the regulatory framework, and a better understanding of the strategies of companies to comply with and to influence regulation. It finishes with a set of policy recommendations, including a stronger mutual recognition of the interplay of existing and new regulations with innovation and innovation policy instruments, as well as improving the implementation of regulations to foster innovation.

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