Economic specialization and diversification at the country and regional level: introducing a conceptual framework to study innovation policy logics

ABSTRACT

While there has been a shared understanding that innovation policy is about rendering institutional change, there has been an emerging interest in identifying the institutional logics underlying innovation policy. To date, few studies have attempted to conceptualise these logics. This paper develops a novel conceptual framework for understanding innovation policy logics based on seminal contributions from organizational and economic theory. The framework distinguishes four logics, namely, specialized exploitation, diversified exploitation, specialized exploration, and diversified exploration. It is illustrated in the empirical analysis of innovation policies and development on both national and regional levels in Norway and Finland. The findings reveal that in both countries there is a movement towards increasingly diversified innovation strategies, despite differences in logics underpinning the policies.

KEYWORDS:

• Innovation policy
• institutional logics
• specialization
• diversification
• Finland
• Norway

Acknowledgements

Earlier versions of this paper were presented at the 4S Annual Meeting, S&T policies: the evolution of agendas and of governance practices, Denver USA, in November 2015 and the EU-SPRI Conference: Exploring New Avenues for Innovation and Research Policies, Lund, Sweden, in June 2016. We are grateful for all comments and feedback.

Disclosure statement

No potential conflict of interest was reported by the authors.

ORCID

Yuzhuo Cai http://orcid.org/0000-0002-7934-3828

Markku Sotarauta http://orcid.org/0000-0001-6603-6370

Notes

1 In 2018 the Finnish Trade Promotion Organization (Finpro) and Tekes were merged, and the new organization was named Business Finland.

Additional information

Funding

This research is a part of the project ‘Exploring the role of VRI in regional innovation system formation and new path development’ funded by the Research Council of Norway [grant number 233788] in the Programme for Regional R&D and Innovation (VRI ). With regard to Finland, this work was also supported by a grant from the Nordic Green Growth Research and Innovation Programme in cooperation with NordForsk, Nordic Innovation and Nordic Energy Research [grant number 83130].