UNDERSTANDING INNOVATION ECOSYSTEMS Catriona Sissons 1 , Dion ONeale - - PowerPoint PPT Presentation

▶
understanding innovation
SMART_READER_LITE
LIVE PREVIEW

UNDERSTANDING INNOVATION ECOSYSTEMS Catriona Sissons 1 , Dion ONeale - - PowerPoint PPT Presentation

Mar 08, 2023 328 likes •769 views

UNDERSTANDING INNOVATION ECOSYSTEMS Catriona Sissons 1 , Dion ONeale 2 , Shaun Hendy 1,2 1 Victoria University of Wellington 2 University of Auckland Te Pnaha Matatini The Centre for Complex Systems and Networks NEW ZEALANDS ECONOMIC

slide-1
SLIDE 1

Te Pūnaha Matatini The Centre for Complex Systems and Networks

UNDERSTANDING INNOVATION ECOSYSTEMS

Catriona Sissons1, Dion O’Neale2 , Shaun Hendy1,2

1 Victoria University of Wellington 2 University of Auckland

slide-2
SLIDE 2

Te Pūnaha Matatini The Centre for Complex Systems and Networks

NEW ZEALAND’S ECONOMIC HISTORY

slide-3
SLIDE 3

Te Pūnaha Matatini The Centre for Complex Systems and Networks

NEW ZEALAND’S ECONOMIC HISTORY

slide-4
SLIDE 4

Te Pūnaha Matatini The Centre for Complex Systems and Networks

“The mystery is why a country that seems close to best practice in most of the policies that are regarded as the key drivers of growth is nevertheless just an average performer.” OECD Economic surveys: New Zealand (2003). “If we adopt an economic geography perspective, there is nothing really paradoxical about New Zealand’s productivity performance.” Phil McCann, New Zealand Economic Papers (2010).

NEW ZEALAND’S ECONOMIC HISTORY

slide-5
SLIDE 5

Te Pūnaha Matatini The Centre for Complex Systems and Networks

  • It is generally recognised that science and innovation

are the key drivers of long run productivity growth

  • NZ under-invests in R&D compared to other OECD

countries but is not an outlier given its size, distance from markets and industrial mix (Crawford, 2007)

SCIENCE AND INNOVATION

  • That is, we look like Australia
  • We need to understand the economic geography of the

production of knowledge before we can identify causes

slide-6
SLIDE 6

Te Pūnaha Matatini The Centre for Complex Systems and Networks

  • Knowledge is a partially excludable, non-rival good
  • Firms benefit from R&D conducted by others via

knowledge spill-overs

UNDERSTANDING KNOWLEDGE

  • The value of knowledge spill-overs is of the same order
  • f magnitude as the private returns from R&D
  • Firms will under-invest in R&D and/or an economy may

become too specialised

slide-7
SLIDE 7

Te Pūnaha Matatini The Centre for Complex Systems and Networks

  • The economic value of scientific knowledge is

considerably greater than it’s market value

  • If government can stimulate science and innovation

then its economy could grow faster than under laissez- faire

  • Governments have a key role in addressing this market

failure (patents, R&D grants, R&D tax credits, public research system)

UNDERSTANDING KNOWLEDGE

slide-8
SLIDE 8

Te Pūnaha Matatini The Centre for Complex Systems and Networks

  • New Zealand produces 0.2% of the world’s scientific

knowledge so much of the knowledge we use will be generated overseas

KNOWLEDGE IN SMALL COUNTRIES

  • We can’t free-ride as our ability to absorb knowledge

depends on the strength of our own R&D capability (Cohen and Levinthal, 1989)

  • Decisions on where or how we invest should be made

with regard to “the rest of the world” (Jaffe 2013)

slide-9
SLIDE 9

Te Pūnaha Matatini The Centre for Complex Systems and Networks

KNOWLEDGE IN SMALL COUNTRIES

But small countries face choices:

  • Competition or collaboration (public/private)?
  • Scale (intra-industry spill-overs) or diversity (inter-industry

spill-overs)? We need to understand the economic geography of innovation before we can understand the implications of these choices

slide-10
SLIDE 10

Te Pūnaha Matatini The Centre for Complex Systems and Networks

THE INNOVATION ECOSYSTEM

slide-11
SLIDE 11

Te Pūnaha Matatini The Centre for Complex Systems and Networks

1 10 100 10000 100000 1000000 0.001 0.01 0.1 1 10 100 1000 10000 100000 1000000 10000000 0.01 0.1 1 10 100 1000 10000 100000 1000000

Number of companies with greater revenues Revenue (NZD '000) Average mass (grams) Density (plants per square metre)

THE INNOVATION ECOSYSTEM

slide-12
SLIDE 12

Te Pūnaha Matatini The Centre for Complex Systems and Networks

0.1 1 10 100 1 10 100 0.001 0.01 0.1 1 10 100 1000 10000 100000 1000000 10000000 0.01 0.1 1 10 100 1000 10000 100000 1000000

% of firms with more than N patents Number of patents, N Average mass (grams) Density (plants per square metre)

Biomass distribution New Zealand patents

THE INNOVATION ECOSYSTEM

slide-13
SLIDE 13

Te Pūnaha Matatini The Centre for Complex Systems and Networks

0.001 0.01 0.1 1 10 100 1 10 100 1000 10000 100000 0.001 0.01 0.1 1 10 100 1000 10000 100000 1000000 10000000 0.01 0.1 1

% of firms with more than N patents Number of patents, N Average mass (grams) Density (plants per square metre)

United States Australia New Zealand Finland

THE INNOVATION ECOSYSTEM

slide-14
SLIDE 14

Te Pūnaha Matatini The Centre for Complex Systems and Networks

THE INNOVATION ECOSYSTEM

slide-15
SLIDE 15

Te Pūnaha Matatini The Centre for Complex Systems and Networks 50 100 150 200 250 300 350 Finnish Engineering PhDs per year New Nokia inventors per year

THE INNOVATION ECOSYSTEM

slide-16
SLIDE 16

Te Pūnaha Matatini The Centre for Complex Systems and Networks

1 10 100 1000 10000 10000 100000 1000000 10000000

Number of patents Regional population

Auckland Sydney Melbourne Brisbane Adelaide Christchurch Wellington Canberra Waikato

SCALE

slide-17
SLIDE 17

Te Pūnaha Matatini The Centre for Complex Systems and Networks Stylised fact: Bigger cities produce more patents per capita

ECONOMIC GEOGRAPHY OF INNOVATION

slide-18
SLIDE 18

Te Pūnaha Matatini The Centre for Complex Systems and Networks 0.60 0.65 0.70 0.75 0.80 0.85 0.90 5000 10000 15000 20000 25000 30000 35000 Fraction of authors in largest connected component Total number of scientists

Auckland Canberra Brisbane New Zealand Melbourne Sydney Adelaide Perth

CONNECTIVITY

slide-19
SLIDE 19

Te Pūnaha Matatini The Centre for Complex Systems and Networks Stylised fact: Bigger cities produce more patents per capita Stylised fact: Innovators are better connected in bigger cities

ECONOMIC GEOGRAPHY OF INNOVATION

slide-20
SLIDE 20

Te Pūnaha Matatini The Centre for Complex Systems and Networks Medical science Vet science Soil science

KNOWLEDGE SPILLOVERS FROM DIVERSITY

  • Some knowledge is highly specialised; other types of

knowledge are broadly applicable

slide-21
SLIDE 21

Te Pūnaha Matatini The Centre for Complex Systems and Networks

  • Some knowledge travels (codified) but some knowledge

doesn’t (tacit); tacit knowledge is difficult to observe

Auckland A B C Christchurch A B D P Q R

KNOWLEDGE SPILLOVERS FROM DIVERSITY

slide-22
SLIDE 22

Te Pūnaha Matatini The Centre for Complex Systems and Networks

KNOWLEDGE SPILLOVERS FROM DIVERSITY

  • Examine the revealed comparative advantage of regions
  • r countries

diverse ubiquitous novel specialised

slide-23
SLIDE 23

Te Pūnaha Matatini The Centre for Complex Systems and Networks Patent Space (TL3 Regions)

Military Bicycles Paper Foundries Alloys Inorganic Chemistry Electrolysis Nuclear Reactors & Radiation Furnaces Fluid Separation Turbines Glues, Inks, Paints Enzymes Organic Chemistry Oscillators & Amplifiers Nanotech Digital Communication Counters & Clocks Medical Devices & Preparations Biotech Food Processing Small Arms Book Binding Sewing Fibers Garments Spinning/ Weaving Food Manufacture Dairy, Oils & Fats

KNOWLEDGE SPILLOVERS: WORLD

slide-24
SLIDE 24

Te Pūnaha Matatini The Centre for Complex Systems and Networks

KNOWLEDGE SPILLOVERS: NEW ZEALAND

Surgical tools Biotech Food processing Enzymes & biomolecules Semiconductors & nanotechnology Clocks Amplifiers; resonators;

  • scillators
slide-25
SLIDE 25

Te Pūnaha Matatini The Centre for Complex Systems and Networks

KNOWLEDGE SPILLOVERS: REGIONS

Electronics Electronics

slide-26
SLIDE 26

Te Pūnaha Matatini The Centre for Complex Systems and Networks 10 20 30 40 50 60 70 80 10000 100000 1000000 10000000 Diversity Population

DIVERSITY VS POPULATION

slide-27
SLIDE 27

Te Pūnaha Matatini The Centre for Complex Systems and Networks Stylised fact: Bigger cities produce more patents per capita Stylised fact: Innovators are better connected in bigger cities Stylised fact: Bigger cities support a greater diversity of patents

ECONOMIC GEOGRAPHY OF INNOVATION

slide-28
SLIDE 28

Te Pūnaha Matatini The Centre for Complex Systems and Networks

UBIQUITY VS POPULATION

400 600 800 1000 1200 1400 1600 10000 100000 1000000 10000000 Mean ubiquity Population

slide-29
SLIDE 29

Te Pūnaha Matatini The Centre for Complex Systems and Networks Stylised fact: Bigger cities produce more patents per capita Stylised fact: Innovators are better connected in bigger cities Stylised fact: Bigger cities support a greater diversity of patents

ECONOMIC GEOGRAPHY OF INNOVATION

Stylised fact: Bigger cities tend to have more novel patent portfolios

slide-30
SLIDE 30

Te Pūnaha Matatini The Centre for Complex Systems and Networks Hypothesis: Innovators are exploiting the density and diversity of the networks available to them to generate new knowledge

ECONOMIC GEOGRAPHY OF INNOVATION

Stylised fact: Bigger cities produce more patents per capita Stylised fact: Innovators are better connected in bigger cities Stylised fact: Bigger cities support a greater diversity of patents Stylised fact: Bigger cities tend to have more novel patent portfolios

slide-31
SLIDE 31

Te Pūnaha Matatini The Centre for Complex Systems and Networks

We need to build a city of four million people We need to build a city of four five million people

slide-32
SLIDE 32

Te Pūnaha Matatini The Centre for Complex Systems and Networks

Japan USA Germany France China Sth Korea

OPEN INNOVATION

10% of companies now produce 80% of all patents

slide-33
SLIDE 33

Te Pūnaha Matatini The Centre for Complex Systems and Networks

We need to build a city of four million people We need a dating service for ideas We need to build a city of four five million people

slide-34
SLIDE 34

Te Pūnaha Matatini The Centre for Complex Systems and Networks New Zealand Denmark

CHOICES IN SMALL COUNTRIES

slide-35
SLIDE 35

Te Pūnaha Matatini The Centre for Complex Systems and Networks 100 200 300 400 500 600 700 Primary Manufacturing Services R&D spending (2010, million dollars) Private sector Public sector

CHOICES IN SMALL COUNTRIES

slide-36
SLIDE 36

Te Pūnaha Matatini The Centre for Complex Systems and Networks

  • Which regions have the most novel and transferrable

(complex) sources of knowledge?

PATENT COMPLEXITY

Denmark A B C NZ A B D P Q R

slide-37
SLIDE 37

Te Pūnaha Matatini The Centre for Complex Systems and Networks 200 400 600 800 1000 1200 1400 1600 20 40 60 80 Mean ubiquity Diversity TL3 Regional Patent Space Canterbury has comparative advantage in a diverse range of novel patent classes

PATENT COMPLEXITY

slide-38
SLIDE 38

Te Pūnaha Matatini The Centre for Complex Systems and Networks

PATENT COMPLEXITY

  • 2.0
  • 1.5
  • 1.0
  • 0.5

0.0 0.5 1.0 1.5 10000 100000 1000000 10000000 Patent complexity Population

  • Patent complexity does not scale with population size
slide-39
SLIDE 39

Te Pūnaha Matatini The Centre for Complex Systems and Networks

PATENT COMPLEXITY

JP US KR DE NL FR CH GB IT CN SE BE FI CA AT AU ES IL DK NO LU IN ZA IE BR NZ PL TR CZ SI GR MX PT SK EE CL IS

  • 2.0
  • 1.5
  • 1.0
  • 0.5

0.0 0.5 1.0 1.5 2.0 2.5 3.0 3.5

Patent Complexity Index

slide-40
SLIDE 40

Te Pūnaha Matatini The Centre for Complex Systems and Networks

PATENT COMPLEXITY

0.001 0.01 0.1 1 10 100 1 10 100 1000 10000 100000 0.001 0.01 0.1 1 10 100 1000 10000 100000 1000000 10000000 0.01 0.1 1

% of firms with more than N patents Number of patents, N

  • 2.0
  • 1.5
  • 1.0
  • 0.5

0.0 0.5 1.0 1.5 2.0 2.5 3.0 3.5 0.2 0.4 0.6 0.8 1 1.2 1.4 Patent complexity index Exponent, b

slide-41
SLIDE 41

Te Pūnaha Matatini The Centre for Complex Systems and Networks

We need to build a city of four million people We need a dating service for ideas We need to build a city of four five million people We need to diversify our science and innovation portfolio

slide-42
SLIDE 42

Te Pūnaha Matatini The Centre for Complex Systems and Networks

slide-43
SLIDE 43

Te Pūnaha Matatini The Centre for Complex Systems and Networks

We need to build a city of four million people We need a dating service for ideas We need to build a city of four five million people We need to diversify our science and innovation portfolio We need to place a higher value on knowledge