The Capitalization of Knowledge
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The Capitalization of Knowledge

A Triple Helix of University–Industry–Government

Edited by Riccardo Viale and Henry Etzkowitz

This ground-breaking new volume evaluates the capacity of the triple helix model to represent the recent evolution of local and national systems of innovation. It analyses both the success of the triple helix as a descriptive and empirical model within internationally competitive technology regions as well as its potential as a prescriptive hypothesis for regional or national systems that wish to expand their innovation processes and industrial development. In addition, it examines the legal, economic, administrative, political and cognitive dimensions employed to configure and study, in practical terms, the series of phenomena contained in the triple helix category.
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Chapter 3: Venture Capitalism as a Mechanism for Knowledge Governance

Cristiano Antonelli and Morris Teubal


1 Cristiano Antonelli and Morris Teubal INTRODUCTION 1. New dedicated capital markets specialized in the public transactions of the stocks of ‘science-based companies’ emerged in the USA during the 1970s. These new financial markets enable the anticipation of returns stemming from the economic applications of technological knowledge, bundled with managerial competence, but non-embodied in either capital or intermediary goods. As such the financial markets have, for the first time in history, promoted the creation and growth of a specialized segment of ‘inventor’ companies and favored public transactions in technological knowledge as an activity per se. These new financial markets are becoming a key component of an innovation-driven novel institutional system termed ‘venture capitalism’. This is key for a new model of ‘knowledge-based’ growth relevant not only for information and communication technologies but also for biotechnologies and new radical technologies at large (Perez, 2003). As such, venture capitalism can be considered a major institutional innovation that enables higher levels of knowledge governance. The basic ‘innovation’ here is not technological but rather institutional, as it consists in a new hybrid organization based upon the bundling of knowledge, finance and competence into new science-based startup firms and in the trade of their knowledge-intensive property rights in dedicated institutional financial markets (Hodgson, 1998; Menard, 2000, 2004; Menard and Shirley, 2005). In order to grasp the process that has led to its introduction we shall rely upon the complexity approach to the economics of innovation. The application of the tools of complex system dynamics to...

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