Innovation in the Service Economy
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Innovation in the Service Economy

The New Wealth of Nations

Faïz Gallouj

In this book Faïz Gallouj propounds a theoretical framework which describes and evaluates the main approaches to analysing and understanding innovation in services. He provides interesting and extensive empirical material on the nature and sources of innovation in various services sectors and countries, and makes an original contribution both to theories of innovation in services and theories of innovation in general. Taking both an evolutionary and conventionalist stance, he demonstrates that services, and more importantly innovations in services, can be regarded as the new wealth of nations.
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Chapter 3: Models of Innovation Derived from a Characteristics-Based Approach

Faïz Gallouj


3. Models of Innovation derived from a Characteristics-Based Approach INTRODUCTION If the approach to the product (good or service) outlined in the previous chapter is accepted, innovation can be defined as any change affecting one or more terms of one or more vectors of characteristics (of whatever kind technical, service or competence). These changes are brought about by a range of basic mechanisms: evolution or variation, disappearance, appearance, association, dissociation or formatting (in the etymological sense of giving shape to or imposing a format on an ill-defined element). They may be ‘programmed’, that is intentional, the product of R&D, design and innovation activity, or ‘emergent’, that is the fruit of natural learning mechanisms. In this book, innovation is seen not as an outcome but rather as a process. Thus our concern is not so much with ‘forms’ of innovation as with ‘modes’ or ‘models’ of innovation that describe the particular dynamics of characteristics (those listed in the opening paragraph). The notion of the ‘product’ advanced here has the advantage, as we have already noted, of not excluding processes (and thus analysis of innovation processes). Nevertheless, the models of innovation outlined here are not articulated around the problematic dichotomy of product and process innovation. The representation adopted here has a further advantage: it breaks with the distinction between radical and nonradical innovations by introducing different modes of product improvement (learning, or the addition of characteristics). Drawing on the characteristics-based approach and the empirical material at our disposal, we will attempt,...

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