National Innovation Strategies in the Global Economy
Edited by Göran Marklund, Nicholas S. Vonortas and Charles W. Wessner
Chapter 11: Critical Dimensions of Innovation Policy: Challenges for Sweden and the EU
Göran Marklund 11.1 INTRODUCTION Competition and competitiveness are at the heart of economic systems. Business ﬁrms in diﬀerent nations are increasingly competing, either directly or indirectly, with foreign-based ﬁrms. Business competitiveness is essential not only to business ﬁrms, but also to the performance of national and regional economies. Policy strategies and design are an integral part of business competitiveness, since public institutions and policy are deeply and inherently embedded in all kinds of business activities – indirectly as the provider of general and speciﬁc conditions of fundamental importance for general business incentives and opportunities. And directly as the provider of markets, through public demand, and resources, through public investments and capital, which are often of critical importance for diﬀerent kinds of business activities. Business renewal is essential to sustained competitiveness in competitive business environments: without it, competition will eventually erode the very value basis of businesses (Schumpeter, 1934). Innovation is at the heart of business renewal and should be understood as the generation of new or improved businesses through the transformation of new ideas or new combinations of existing ideas into new business models, new products, new production processes or new business organizations. Large numbers of technology and business experimentations continuously lead to new combinations and mutations of business ideas and technologies. Some innovative combinations turn out to be more competitive than others. Innovation processes are intimately associated with entrepreneurship,1 related to business, technology and organization. This general logic of economic development, based on dynamic competition...
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