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QUESTION
Edler and Fagerberg present three commonly-articulated frameworks or justifications for “innovation policy.” In your answer, select one of the authors listed below. Explain which of Edler and Fagerberg’s frameworks you believe would best fit a set of policy prescriptions that reflect your selected author’s argument about how innovative environments are characterized. That is, if your selected author was developing policy solutions based on their core argument, which of Edler & Fagerberg’s frameworks would best match it? Then, given your classification, explain two specific policies to promote innovation you believe would be consistent with your selected author’s arguments. (note: as part of your answer, you may also wish to briefly note why the alternative frameworks do NOT fit your selected author’s perspective)
You may choose from:
- AnnaLee Saxenian’s account of Silicon Valley and Route 128
- Lee Kuan Yew’s discussion of Singapore, Asia, and the “West”
- John Alic’s discussion of “everyone an innovator”
ANSWER
Edler and Fagerberg’s Justifications for Innovation Policy and AnnaLee Saxenian’s account of Silicon Valley and Route 128
Due to the developing concern for the role of innovation in economic performance and the arising challenges, policymakers have increasingly sought to understand how innovation and policy interplay. Therefore, they have sought to define innovation policy through the ‘what’ dimension, the theoretical rationales (‘why’), and ‘how’, which implies the innovation policy design, implementation, and governance. Based on AnnaLee Saxenian’s account of Silicon Valley and Route 128, the organizations needed instruments to support their interactions to reach their innovation goals. Therefore, the ‘how’ framework would be the best match as it describes innovation policy instruments like collaboration, which were significant in the success of Silicon Valley.
Saxenian explains how Silicon Valley was open to communication and exchange across the firms while their counterparts in Route 128 embraced vertical integration. Considering how the ‘how’ framework explores instruments that support the capabilities of organizations, it can align with a set of policy prescriptions reflected in AnnaLee Saxenian’s account of Silicon Valley and Route 128. Moreover, the diversity in the ‘how’ framework can impact or foster Silicon Valley through aspects of involvement, both in employees and other stakeholders and the industry.
According to Saxenian, Silicon Valley stood out in the competition through venture-capital leadership, which helped transfer skills and knowledge between the firms they collaborated with. Silicon Valley had a culture of putting no restrictions on information and skills sharing compared to Massachusetts firms, which sought intellectual property protection and ended up with merely enough to protect. Therefore, the most specific policies that would be consistent with AnnaLee Saxenian’s account of Silicon Valley and Route 128 would be policies to support collaboration and innovation network policies.
Among the reasons firms collaborate is the attainment of economies of scale and scope. With regard to AnnaLee Saxenian’s account of Silicon Valley and Route 128, firms in Silicon Valley collaborated to access complementary resources for innovation and learn from the partners to create new capabilities for competitiveness enhancement. Therefore, policies to support collaboration are advantageous in the Silicon Valley case. According to Cunningham and Gök (2012), although collaboration is intuitively created between non-competing firms, collaborations with suppliers, customers, higher education institutions for R&D, and even competitors will help firms expand their expertise range and achieve a majority of corporate objectives. Unlike Route 128, which ended with less to protect after seeking to protect their intellectual property by not collaborating, Silicon Valley succeeded due to its readiness to share information and skills.
On the other hand, innovation network policies are influenced by the increasing importance of networks in technology and innovation policies of many countries. The government’s intervention partly influences the success of innovation network policies in the continuous development of a network (Cunningham and Ramlogan, 2012). Considering how the collaboration contributed to Silicon Valley’s success, the innovation network policies can suit AnnaLee Saxenian’s arguments. According to Edler and Fagerberg (2017), networks can impact the stimulation of learning processes and skills. Moreover, networks with proper management of network relationships and experience are likely to contribute to achieving individual and collective objectives.
In summary, the ‘what’ framework may not be a fit for AnnaLee Saxenian’s account of Silicon Valley and Route 128 because the definition of policies is not necessary as the organizations needed instruments that would justify their actions or disregard them; therefore, the ‘how’ framework was a better match due to the policy processes contained within like the design, implementation and implementation unlike the introductory approach of the ‘what’ framework.
References
Cunningham, P., & Gök, A. (2012). The Impact And Effectiveness Of Policies To Support Collaboration For R&D And Innovation. https://media.nesta.org.uk/documents/the_impact_and_effectiveness_of_policies_to_support_collaboration_for_rd_and_innovation.pdf
Cunningham, P., & Ramlogan, R. (2012). The Effects Of Innovation Network Policies. https://media.nesta.org.uk/documents/the_effects_of_innovation_network_policies.pdf
Edler, J., & Fagerberg, J. (2017). Innovation Policy: What, Why, And How. Oxford Review of Economic Policy, 33(1), 2-23. https://doi.org/10.1093/oxrep/grx001
Saxenian, A. (1985). Silicon Valley and Route 128: Regional Prototypes Or Historic Exceptions. Urban Affairs Annual Reviews, 28, 81-105.
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