Global Experience in Policy and Program Development
Edited by Sarfraz A. Mian
Chapter 16: Micro and Small Enterprise Based Innovative Entrepreneurship and the Development of Local Productive Systems in Brazil
Ana Arroio, José E. Cassiolato and Helena Lastres INTRODUCTION It has been known for decades that innovation comprises more than just R&D. As investments in intangibles such as R&D, software, product design, process engineering, training, marketing and management came to play a larger role in the production of goods and services, innovation was no longer understood as radical processes in high-tech sectors that can only be carried out by large firms. This has important implications for policy and programme development that seeks to stimulate innovation in developing countries. It requires a shift in policy focus to emphasize the promotion of less favoured regions and of micro and small enterprises (MSEs) that in most circumstances form the basis of local economies. Positive experiences in many countries have contributed to the shift in focus and to the search for alternatives based on the promotion of MSEs, particularly those organized collectively. This chapter brings to the fore an important experience in policy and programme development to foster regional entrepreneurship. It considers policies to promote innovation in Brazil in the 1990s and at the turn of the twenty-first century. It uses the methodology developed by the Brazilian research network on Local Production and Innovation Systems (RedeSist) to examine local productive systems, that is, any productive agglomeration involving economic, political and social agents located in the same area, performing related economic activities and presenting consistent articulation, interaction, cooperation and learning processes.1 It represents a practical unit of analysis and investigation that goes well...
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