Ireland's national innovation system: An exploratory study of supporting institutions and dynamic actors

Prometheus: Critical Studies in Innovation

Volumn 24, Issue 1, 2006, Pages 37-58

  Pontikakis, Dimitrios ^a   McDonnell, Thomas ^b   Geoghegan, Will ^b  

^a NATIONAL UNIVERSITY OF IRELAND   (Ireland)

^b NONE

Author keywords

Incentives; Innovation actors; Institutions; Ireland; National innovation system; Science and technology policy

Indexed keywords

CONCEPTUAL FRAMEWORK; INCENTIVE; INNOVATION; INSTITUTIONAL DEVELOPMENT; POLICY APPROACH; SCIENCE AND TECHNOLOGY;

EURASIA; EUROPE; IRELAND; WESTERN EUROPE;

EID: 33645125658     PISSN: 08109028     EISSN: None     Source Type: Journal    
DOI: 10.1080/08109020600563861     Document Type: Article

References (155)

1. Government, National Development Plan 2000-2006, Stationery Office, Dublin, 1999.
2. OECD, National Innovation Systems, OECD Publications, Paris, 1997.
3. Following on the rhetorical tradition of the 'Asian Tigers', Ireland's recent economic experience has prompted correspondingly dramatic animal analogies; see The Celtic Tiger (Paul Sweeney)
4. and The Irish Hare (Patrick Honohan and Brendan Walsh).
5. S. Yearley, 'From one dependency to another: The political economy of science policy in the Irish Republic in the second half of the twentieth century', Science, Technology and Human Values, 20, 1995, pp. 171-96
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10. UNCTAD, World Investment Report 2004, available at: http://www.unctad.org/fdistatistics (accessed 27 March 2005).
11. Yearley, op. cit.
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13. J. Cogan and J. McDevitt, 'Science, technology and innovation policy & science and technology policy evaluation: The Irish experience', paper presented at the Converge Workshop Madrid, 5 October 2000
14. J. Cogan, 'Building a system of innovation: Reflections on the Irish experience', Science Policy Research Centre, UCD, July 2003
15. F. Barry, 'FDI, transfer pricing and the measurement of R&D intensity', Research Policy, 34, 2005, pp. 673-81.
16. Some evidence of Ireland's role as a supplier of technology comes from Forfás [Forfás, Business Expenditure on Research and Development (BERD) Ireland 2003/4, Forfás, Dublin, 2005, p. 7]. Ireland's continuing BERD growth in the period 2001-03 on the face of the postmillennium worldwide economic slowdown, particularly in ICT, is suggestive of the prevalence of supply-side considerations.
17. HEA, HEA Report, Higher Education Authority, 2002
18. ESG, Ahead of the Curve: Ireland's Place in the Global Economy, Enterprise Strategy Group, Dublin, 2004.
19. Forfás, Innovation Networks, Tom Martin and Associates, Dublin, 2004a.
20. Culliton Report, A Time for Change: Industrial Policy for the 1990s, Industrial Policy Review Group, Stationery Office, Dublin, 1992
21. ICSTI, Technology Foresight Ireland, Irish Council for Science, Technology and Innovation, Dublin, 1999
22. Government, op. cit.
23. OECD, Main Science and Technology Indicators, OECD Publications, Paris, 2004a.
24. BERD as a percentage of GERD rose from a value of 58 in 1991 to almost 70 in 2001 (Ibid.).
25. Forfás, State Expenditure on Science and Technology 2002 and 2003, Forfás, Dublin, 2004c.
26. OECD, Review of Higher Education in Ireland, Education Committee, Dublin, 2004.
27. There is no universally accepted index of technological capability. Recent attempts (UNDP, Human Development Report 2001: Making New Technologies Work for Human Development, Oxford University Press, New York, 2001;
28. D. Archibugi and A. Coco, 'Measuring technological capabilities at the country level: A survey and a menu of choice', Research Policy, 34, 2, 2005. differ in methodology and in their respective rankings. Nevertheless, they both calculate the end score of each country as a composite of statistics in the generation of new ideas, the diffusion of existing innovations, trade in technological goods and the country's infrastructural and human resource assets.
29. UNDP, op. cit., p. 45.
30. Ibid.
31. The ranks stated are based on a survey total of 72 and 160 countries, respectively. See Archibugi and Coco, op. cit.
32. J. L. Furman, M. E. Porter and S. Stern, 'The determinants of national innovative capacity', Research Policy, 31, 2002, pp. 899-933.
33. OECD, 1997, op. cit.
34. B. Å. Lundvall, B. Johnson, E. S. Andersen and B. Dalum, 'National systems of production, innovation and competence building', Research Policy, 31, 2002, pp. 213-31.
35. B. Å. Lundvall (ed.), National Systems of Innovation: Towards a Theory of Innovation and Interactive Learning, Pinter, London, 1992
36. P. Patel and K. Pavitt, 'National innovation systems: Why they are important and how they might be measured and compared', Economics of Innovation and New Technology, 3, 1994, pp. 77-95.
37. OECD, 1997, op. cit.
38. It should be noted that while this distinction is by and large in line with the views of Lundvall, op. cit.
39. and Nelson and Sampat (R. Nelson and B. Sampat, 'Making sense of institutions as a factor shaping economic performance', Journal of Economic Behavior and Organization, 44, 2001, pp. 31-54) there is no agreement within the NIS approach as to what the demarcation of actors and institutions is.
40. For example, Patel and Pavitt, op. cit., view industry, government and academia as institutions too. Our distinction here is justified in terms of relative dynamism.
41. D. North, Institutions, Institutional Change, and Economic Performance, Cambridge University Press, Cambridge, 1990
42. Lundvall, op. cit.
43. Nelson and Sampat, op. cit., p. 40.
44. E. S. Andersen, 'Approaching the national systems of innovation from the production and linkage structure', in Lundvall (ed.), op. cit.
45. Lundvall, op. cit.
46. A firm could of course enter into a collaborative innovation venture without prior experience of innovation. This does not equate bypassing the first step of the decision process, as engaging in collaboration implies having identified innovation as a viable strategy.
47. J. Peterson and M. Sharp, Technology Policy in the European Union, Macmillan Press, London, 1998.
48. C. Freeman, 'The national system of innovation in historical perspective', Cambridge Journal of Economics, 19, 1995, pp. 5-24.
49. For it is not only policy directions that are taken at the national level; with few exceptions, funding for innovation-related activities stems from such central government bodies as the Department of Enterprise, Trade and Employment and the Department of Education and Science. For all their international connectedness, MNEs too may often formulate strategic decisions at the national level ultimately shaped by the economic conditions prevalent locally.
50. J. D. House and K. McGrath, 'Innovative governance and development in the new Ireland: Social partnership and the integrated approach', Governance: An International Journal of Policy, Administration, and Institutions, 17, 2004, pp. 29-57.
51. Barry, 1999, op. cit.
52. J. Wickham and G. W. Boucher, 'Training cubs for the Celtic tiger: The volume production of technical graduates in the Irish educational system', Journal of Education and Work, 17, 2004, pp. 377-95
53. House and McGrath, op. cit.
54. Wickham and Boucher, op. cit.
55. P. Honohan, 'Fiscal adjustment and disinflation in Ireland: Setting the basis for economic recovery and expansion', in Barry (ed.), 1999, op. cit.
56. S. D. Barrett, 'Privatisation in Ireland', CESIFO Working Paper, 1170, 2004, available at: http://www.cesifo.de/DocCIDL/1170.pdf (accessed 10 June 2005).
57. Barry, 1999, op. cit.
58. F. Barry, 'The Celtic tiger era: Delayed convergence or regional boom', ESRI Quarterly Economic Commentary, ESRI, Dublin, 2002
59. P. Honohan and B. Walsh, 'Catching up with the leaders: The Irish hare', Brookings Papers on Economic Activity, 1, 2002.
60. Patents Office, Seventy Seventh Annual Report of the Controller of Patents, Designs and Trade Marks, Government Publications, Dublin, 2004.
61. IDA, A Guide to Tax in Ireland, IDA, Dublin, 2004c.
62. In the international awareness scheme 'Linking Innovation and Industrial Property' (LIIP), administered by Enterprise Ireland. See also, Patent Office, op. cit.
63. A. Afonso, L. Schuknecht and V. Tanzi, 'Public sector efficiency: An international comparison', European Central Bank, Working Paper, 242, 2003. These authors define public sector performance as 'the outcome of public sector activities' and public sector efficiency as the 'outcome relative to the resources employed'.
64. C. Edquist (ed.), Systems of Innovation: Technologies, Institutions and Organizations, Pinter, London, 1997.
65. J. Kelly and M. Everett, 'Financial liberalisation and economic growth in Ireland', Central Bank and Financial Services Authority of Ireland Quarterly Bulletin, 4, 2004, pp. 91-112.
66. Ibid.
67. J. C. Fingleton, 'Competition and standard setting in Irish financial services', National Management Conference - Irish Management Institute, 2005, available at: http://www.tca.ie/speeches/presentations/ jf_icis_may05.pdf (accessed 11 June 2005).
68. J. L. Christensen, 'The role of finance in national systems of innovation', in Lundvall (ed.), op. cit.
69. Cf. press releases available at http://www.isme.ie.
70. An example of lasting financial intermediation instruments comes in the form of the 'small firm loan guarantee' schemes operating in the UK.
71. PriceWaterhouseCoopers, Money for Growth The European Technology Investment Report 2004, available at: http://www.ivca.ie/ venture%20capital%20stats%202003%20e.pdf, (accessed 9 June 2005).
72. Commission of the European Communities (CEC), Progress Towards the Common Objectives in Education and Training: Indicators and Benchmarks, 2004a, available at: http://europa.eu.int/comm/education/policies/2010/ doc/progress_towards_common_objectives_en.pdf (accessed 5 June 2005).
73. CEC, 2004a, op. cit.
74. OECD, 2004b, op. cit.
75. Which, in a narrow sense, is a basic measure of the mobility of human resources for science and technology.
76. A. Stimpson, 'Preliminary results from the HRST mobility analysis', Discussion Paper, OECD Focus Group on Mobility of Human Resources, Paris, 2000.
77. B. Carlsson and R. Stankiewicz, 'On the nature, function and composition of technological systems', in Edquist (ed.), op. cit.
78. P. Fitzsimons and C. O'Gorman, 'How entrepreneurial was Ireland in 2004?', Global Entrepreneurship Monitor: The Irish Annual Report, 2005.
79. Total Entrepreneurial Activity (TEA): A composite indicator measuring all kinds of independent start-up activity, including self-employment.
80. Fitzsimons and O'Gorman, op. cit.
81. Ibid.
82. There are more MNEs from the US operating in Ireland than from any other single country. Some 317 out of 726 foreign-owned manufacturing firms are US MNEs (CSO, Census of Industrial Production, Stationery Office, Dublin, 2002)
83. 46% of all government-supported foreign firms are US MNEs (IDA, Annual Report 2003, IDA, Dublin, 2004b).
84. The same companies account for almost 70% of employment in the foreign-owned sector (CSO, op. cit.).
85. This is also reflected in the Inter-Departmental Committee (IDC) for Science, Technology and Innovation, in charge of STI spending decisions across departments and chaired by the Minister for Enterprise, Trade and Employment.
86. Forfás, 2004a, op. cit., p. 1.
87. Science Foundation Ireland, Points of Excellence, Science Foundation Ireland, Dublin, 2005.
88. Evident in the national technology foresight exercise (ICSTI, op. cit.)
89. and future skills needs appraisals (EGFSN, A Model to Predict the Supply and Demand for Researchers and Research Personnel in Line with Ireland's Strategy for Contributing to the European Research Area 3% Initiative, September 2004, available at: http://www.skillsireland.ie/press/reports/ pdf/egfsn040906_research_skills_report.pdf).
90. Görg and Ruane (2000, op. cit.) demonstrate how a country's initial comparative advantage(s) may not be a good predictor of future FDI flows into particular sectors. Using examples from the 1960s and the 1980s, they argue that FDI flows were directed at sectors where contemporary Ireland had a comparative disadvantage.
91. B. Hall and J. Van Reenen, 'How effective are fiscal incentives for R&D? A review of the evidence', Research Policy, 29, 2000, pp. 449-69.
92. Forfás, 2004c, op. cit.
93. In supporting the periphery, paying for education and infrastructure and contributing towards the emergence of a European Research Area.
94. Forfás, 2004c, op. cit.
95. Hayward, op. cit.
96. S. Roper, 'Innovation policy: An effective way of reducing spatial disparities in small nations?', Innovation Lab Europe, Working Paper, Aston Business School, 2004.
97. A. Kane, 'Innovation policy in Ireland: Economic ideas and institutional diversity', Journal of the Statistical and Social Inquiry Society of Ireland, 28, 1, 1999, pp. 115-52.
98. Yearley, op. cit.
99. Ibid., p. 188.
100. Hilliard and Green, op. cit.
101. Previously known as the Industrial Development Authority.
102. Görg and Ruane, 2000, op. cit.
103. Costs covered by the scheme include personnel, instruments and equipment, land and premises, consultancy services and related overheads.
104. IDA, 2004b, op. cit.
105. OECD, 2004a, op. cit.
106. Wickham and Boucher, op. cit.
107. Enterprise Ireland, Annual Report & Accounts 2004, Enterprise Ireland, Dublin, 2005b.
108. Ibid.
109. Enterprise Ireland, Enterprise Ireland's Financial Support: A Guide to Achieving Growth in World Markets, Enterprise Ireland, Dublin, 2005a.
110. EI, 2005b, op. cit.
111. EI, 2005a, op. cit.
112. Forfás, 2005, op. cit.
113. OECD, 1997, op. cit.
114. Forfás, 2005, op. cit.
115. J. Schmookler, 'The level of inventive activity', The Review of Economics and Statistics, 36, 1954, pp. 183-90.
116. Forfás, Survey of Research and Development in the Business Sector, 2001, Forfás, Dublin, September 2003
117. Forfas, 2005, op. cit.
118. Technological convergence (the combination of technologies from two or more emerging fields for an altogether new application) is a promising avenue for diversification, offering opportunities for small and agile firms. The marriage of recent developments in Biotechnology and ICT provides ample examples of the combination potential of converging technologies. These include the fields of bio-prospecting, bio-informatics and bio-mimetics.
119. Forfás, 2005, op. cit., p. 41
120. Commission of the European Communities (CEC), Science and Technology in Europe: Statistical Pocketbook, Office for Official Publications of the European Communities, Luxembourg, 2005, p. 83.
121. Goods the transportation costs of which are low enough to be considered negligible. See D.T. Quah, Eating 1s and 0s: Interactive Digital Media and the Weightless Economy, 1997, available at: http://econ.lse.ac.uk/ dquah/p/9711ace.pdf (accessed 12 June 2005).
122. Forfás, International Trade and Investment Report 2004, Forfás, Dublin, 2004d.
123. C. Edquist, L. Hommen and M. McKelvey, Innovation and Employment, Edward Elgar, Cheltenham, 2001.
124. Microsoft, Intel, Dell, Adobe, Symantec, IBM, Nortel, Honeywell, Lucent, Hewlett-Packard, Wyeth, Bayer, GlaxoSmithKline, Novartis, Johnson and Johnson to name but a few (IDA, Ireland, Knowledge is in Our Nature, IDA, Dublin, 2004a).
125. Forfás, 2005, op. cit.
126. Barry, 2005, op. cit.
127. Ibid.
128. While the majority of R&D performing firms in Forfás' (2005, op. cit.) survey are Irish-owned, they account for a miniscule percentage of the total number of Irish firms. The survey is prone to a sample bias towards innovating firms as the surveyors stately targeted their questionnaires to firms they expected to engage in R&D.
129. Barry, 2005, op. cit.
130. Forfás, 2004a, op. cit.
131. R. Belderbos, M. Carree and B. Lokshin, 'Cooperative R&D and firm performance', Research Policy, 33, 2004, pp. 1477-92.
132. Ibid.
133. Roper, op. cit.
134. H. Louri, R. Loufir and M. Papanastassiou, 'Foreign investment and ownership structure: An empirical analysis', Empirica, 29, 2002, pp. 31-45.
135. H. Görg and F. Ruane, 'Linkages between multinationals and indigenous firms: Evidence for the electronics sector in Ireland', Trinity College Dublin Economics Technical Papers, 9813, Dublin, 1998.
136. Ibid.
137. P. Ryan, M. Giblin and E. Walshe, 'From subcontracted R&D to joint collaboration: The role of trust in facilitating this process', Innovation and Technology Management, 2, 2004, pp. 205-31.
138. Lundvall, op. cit.
139. Edquist, op. cit.
140. As suggested from evidence by Görg and Ruane, 1998, op. cit.
141. Forfás, Survey of Research and Development in the Higher Education Sector 2002, Forfás, Dublin, 2004b, p. 14.
142. Ibid.
143. CEC, 2004a, op. cit., p. 39.
144. Forfás, 2004b, op. cit.
145. OECD, 2004a, op. cit.
146. Private funding of university research stood at 5.3% in 2000, 10.2% in 1990 and 7.1% in 1981.
147. H. Etzkowitz, 'Research groups as "quasi-firms": The invention of the entrepreneurial university', Research Policy, 32, 2003, pp. 109-21.
148. Commission of the European Communities (CEC), Improving Institutions for the Transfer of Technology from Science to Enterprises: Expert Group Report, 2004b, available at: http://www.insme.info/documenti/ itte_expertgroupreport.pdf (accessed 12 June 2005).
149. R. Vernon, 'International investment and international trade in the product cycle', Quarterly Journal of Economics, 2, 1966, pp. 190-207.
150. IDA, 2004b, op. cit.
151. Görg and Ruane, 2000, op. cit.
152. The open-ended and competitive nature of European funding streams (e.g. the Framework Programmes, Marie Curie Fellowships) is especially pertinent.
153. The BMW regional assembly is particularly active in this respect; it communicates the perceived needs of the region through a comprehensive technology foresight study and by means of an annual conference on innovation.
154. Roper, op. cit.
155. Government, op. cit.