A Five-phase Entrepreneurial Oriented Innovation and Technology Policy Profile: The Israeli Experience

Abstract

This paper presents a five-phase innovation and technology policy (ITP) profile based on the Israeli experience of the last four decades. This paper adds two additional phases to a previous paper. This ITP profile refers only to one specific start-up-oriented plan of action out of a multi-pronged strategy for innovation-based economic development. The goal of the ITP profile is promotion of a significant segment of start-ups within the high-tech cluster and to create a sub-segment of fast growing start-ups that eventually will became large companies with very high impact on the economic growth and development. A significant part of the ITP profile is triggering a venture capital (VC) industry, which has been recognized as a vehicle for latching into the information and communication technology (ICT) revolution. We suggest that the Israeli phase ITP profile presented here is a systematic and attractive approach to ITP design in general.

Acknowledgements

Special thanks to Morris Teubal for his extremely helpful comments and suggestions of a previous draft. The idea of a phased ITP model emerged from our joint work analysing Israel's experience with venture capital, high-tech clusters and policy.

Notes

1. This section is based on and extends the analysis found in Avnimelech and Teubak (2004d, 2005b, 2006b).

2. This section is based on and extends the analysis of Avnimelech and Teubak (2006b).

3. This section is based on Avnimelech and Teubak (2005b).

4. A small programme, which started in 1981 whose objective, was the promotion of R&D projects jointly executed by a US and an Israeli company.

5. Israel's innovation system is characterized by a strong academic base and very high quality human capital, a very strongly developed military R&D industrial complex, entrepreneurial culture, strong relations with human capital and academic institutions in other countries, strong relations with the US technological and capital markets, and government coherent ITP strategies.

6. The creation of one main authority responsible for the national innovation and technology policy strategic thinking and implementation such as the OCS in Israel, could significantly contribute to the coherence of the long-term policy design and thus increase the success prospect.

7. These conditions are: sufficient innovation capabilities within the business sector; a critical mass of start-ups; start-up-related experiments; policy experiments and capabilities; international links with both technological and capital markets; some high quality agents in the start-up and VC-related activities; continues technological revolution; and supportive macro-economic conditions.