Us National Innovation System - Summary
Essay by Ahmed Maksoud • April 19, 2017 • Term Paper • 1,920 Words (8 Pages) • 874 Views
Assignment 2
Prepared by : Ahmed Mohamed Abdel Maksoud ID: S1400710
Professor : Raghda El Ebrashi
The definition a National innovation system can be described as “the network of institutions in the public and private sectors whose activities and interactions initiate, import, modify and diffuse new technologies”
To describe the factors affecting the NIS we can demonstrate it as what is called National innovation success
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- Summary
- Business factors:
- High level Executives:
- strong it infrastructure and adoption;, support go risk taking business
- Boarder Factors
- Public acceptance, and culture acceptance and tolerance of failure
- Tax and trade regulatory environment
- Government protection
- Support new entrant
- Transparency
- Convenient regulations level for economy and market
- Innovation Policy system
- innovation support for infrastructure
- Reshaping Tax code to support innovation corporates
- MAJOR DEVELOPMENT STAGES OF THE U.S. NIS
- The US developed since the independence being part of the and innovate because of the steel-based industry and major companies became leaders like GM and Kodak.
- The green field helped the US to implement policies to control and help industries to scale more successful unlike other countries like German and UK. Not only the industry green field but also culture was an advantage.
- internal development was an advantage as creating an infrastructure to support different industries
- Patent system embedded in the constitution
- Motivation for firms to continue innovation
- WWI developed a need for more innovation, Centralized R&D, Allies after WWII helped to secure the power threads
- No focus on promotion for innovation till 1963 to use federal support to focus on industries related to defense and space to tackle the Soviet Union cold war. And find was raised to universities. The extension from universities focus to small and mid-size companies. Congress was not always supporting such initiatives. Moreover they were not guided by a vision and mission.
- Starting 70th the system started to be matured to face the competition from Japan and Germany followed by a support from congress.
- In 1992, Japan competitiveness was reduced as a thread
- With the microprocessors and web 2.0 policy makers recognized the importance of IT to be focus of development and growth.
- IT Evolvement and the US
- Congress Initiatives toward the end of Bush II building in Clintons internet governed regulation :
- Deregulating broadband communication
- Free up Radio spectrum
- Online privacy
- e-Governance
- Although the IT was evolving the US industrial competitiveness was not with a decent decline of 100 M USD in a decade, which lead - along with other countries competition like china - to more attention that was given during Obama administration by initiating number of initiatives to overcome the situation, also congress introduced a variety of measure. Unfortunately efforts was extremely limited due to the political situation, budget limitation and unwillingness to add individual taxes or cut any entitlement.,
- Elements of the USNIS
Element | Factors | Subject | Description |
Business Environment | Market and firms structure and behavior | Managerial Talent | US is a world leader in this aspect Comes from environmental factors that forces the need for better management In 1950 US developed a discipline of management and perfected by time. |
Time Horizon and Risk Appetite of Firms | The force to think short term reduced the focus on long term which resulted on bad innovation planning, low investment return , Etc. | ||
ICT Adoption | US firms invest above other firms in other countries; they are also get more benefits from the IT investment. | ||
Business Financing System | Venture and Risk Capital | Existence of venture capital since 1946 It is not supporting finance only but also managerial Private funding is available Sone state government initiatives to venture funding | |
Firm Finance (Debt and Equity) | Many funding options for firms from private sector or government financing, both are not targeted for innovation | ||
Cultural Factors | Nature of Customer Demand | Demanding consumer nature, pushing the companies to innovate and introduce new products Eagerness for early adoption | |
Risk Taking and Entrepreneurship | deep-seated interest in tinkering, inventing, and making things better | ||
Attitudes Toward Science and Technology | Historical demand to follow science but today this is challenging due to the anti-technology threads like job loss fear. | ||
Collaborative Culture | There is a group collaboration to drive innovation maintaining the intellectual property rights so people and institutes are not afraid to talk. | ||
Time Horizon and Willingness to Invest in the Future | Along the US history this is always supported and maybe depredated on aggressively on 2000-2010 period but it is still getting focus considering the political challenge to force more direct or indirect support. |
Trade, Tax, and Regulatory Environment | Regulatory Environment | Industry Structure and the Nature of Competition | Customer focused. Less barrier to entry for less regulated industries and in contrary to high regulated industries. |
Regulatory System for Entrepreneurship | Easy for new entrant, not only when establish a new business but also in downsizing the business or even close it. | ||
Role and Form of Regulation | This subjects limits innovation due to the demand for more regulations and the cost and budget reduction for regulating agencies. | ||
Transparency and Rule of Law | Role to apply and monitor regulations are strengthen the US innovation | ||
Tax, Trade and Economic Policy | Macroeconomic Environment | On a monetary policy to maintain strong US dollar position. Which is good for consumers but hurts producers. | |
Tax Policy | Not favor for specific industry, relatively high compared to other nations, tax credit relatively anemic | ||
Trade Policy | Relatively anemic Under funding Under promoting effort Focus on customer benefit New trade agreements Interaction with other nations to follow same WTC roles | ||
Intellectual Property | Copyrights and patents, with trademarks are protected. Challenges still exist about the level of protection needed. | ||
Standards | Not particular industry standard but it follows the customer choice. Standards is related to products, processes, services, systems, or personnel. Working on global level |
Innovation Policy Environment | Research and Technology | Support for Research in Universities and Research Labs/Research Institutes | Less sophisticated than other nations as it is considered as inappropriate intervention to the economy. Support both mission critical and basic research was very positive in 60th (Cold ware and moon race) 1990 -2000 doubled for health care but not overall when we look on GDP another increase in around 2010 then fallen down with average 10% because of fiscal challenges facing governments |
Federal Labs | Around 100 lab supported mainly by the department of energy, health and defense. Us benefited from this focus by time | ||
University Research | Largely unrelated to agency mission goals, university R&D VS GDP is behind many nations and needs more focus. | ||
Technology Transfer Systems | Technology transfer from universities to federal labs to commercial marketplace. In 1980 policies started to develop to better commercialize research National institute of standard and technology is the only focus in regard to this matter. | ||
Support for Research in Business | Support was focusing on core mission On firm level tax credit support was developed. Federal government support specific industries like semiconductors US spend significantly less than other nations like Korea 89 time and German 43 times and japan 15 times. | ||
Systems of Knowledge Flows | Innovation Clusters | little explicit role for federal government explicit clustering policy was developed mainly by sub-state and province of state | |
Industry Collaboration Systems (with academia and research institutes) | developed and successful industry-research institute collaboration system | ||
Acquiring Foreign Technology and Exporting U.S. Technology | Changed from leading technology development to acquiring foreign technology. Welcoming foreign technologies helped us to understand Japanese auto manufacturing technologies Exporting is also a key but it is always related to military activities and demand to reduce this restriction is pressuring | ||
Technology Diffusion and Adoption | Modest system Support activities like research, country wide initiatives, etc | ||
Human Capital System | Education/Training (K-12) | the US has a higher share of students in private schools than most other nations. Compared to many other nations, the performance of U.S. K-12 students on internationally comparable standardized tests like PISA and TIMMS is generally lacking. Some argue that the poor performance reflects a lack of national curriculum standards, while others argue that it is more structural in nature increased diversity of kinds of schools. Higher share of students in the United States from socio-economically disadvantaged families. | |
Higher Education | Online study is a trend. Tuition rates have increased significantly as public funding has been cut. US has fallen behind many other nations in higher education enrollment rates. For private schools, some students can afford high tuitions while others receive financial aid from the universities. The American higher education system is diverse and distributed in nature. In addition, there is little national or state effort to guide students in their choice of what they study. | ||
Skill/Technical Training | In the United States, skills training is largely seen as a private sector responsibility. As such, overall private sector investment in skills training has declined by about one-third as a share of GDP in the last decade. | ||
Immigration Policy | At least seven studies have examined the role of immigrants in launching new companies in the United States, and all conclude that immigrants are key actors in this process, creating from 15 percent to 26 percent of new companies in the U.S. high-tech sector over the past two decades. Some U.S. states have seen even greater beneficiaries: nearly 40 percent of the engineering and technology firms founded in the U.S. states of California and New Jersey between 1995 and 2005 were founded by foreign born-immigrants. |
- National innovation systems are evolutionary, not static. For the U.S. innovation system it appears that the direction of change is toward relative worsening, especially when compared to some other national systems whose governments are putting in place a suite of policies designed to win in the global race for innovation advantage.
Clearly the United States appears to have sustainable strengths in a number of areas, including factors such as managerial talent, enterprise use of ICT, and business cultural factors such as demanding customers and a collaborative culture. But to date, Congress has been preoccupied with matters other than enhancing U.S. innovation and competitiveness, and even if they did focus their attention here, the overall budget impasse (Democrats unwilling to cut entitlement spending, Republicans unwilling to raise taxes on individuals) suggests that little of substance will happen in these areas. Finally, while corporate tax reform is an area where some progress is possible, it is at least as likely that nothing major will happen or even that changes will be detrimental for innovation and competitiveness.
In summary, as nations compete to win the global innovation race, some will sprint out ahead, others will remain stuck in the middle of the pack, and still others will struggle to get out of the starting gate.
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