National Innovation Systems

Abstract

Since innovation is central to the success of firms in the 21st century, policymakers in many countries try to achieve sustained competitive advantage by promoting technological innovations. However, achieving this goal requires coordination of all actors in the economy including governments, industries, and national institutions. Although each individual actor has unique capabilities and strategic resources, how well the economy performs depends on the strengths of the network as a whole. National Innovation Systems (NIS) approach considers all these interdependent actors within a country to increase national competitiveness. A good example in this regard is South Korea, an innovation leader, which could be a role model for developing countries with its well-established NIS. This chapter studies the elements of the NIS of this country and compares them with that of an emerging economy, Turkey, by using data from the Global Innovation Index and the Global Competitiveness Index. The analysis reveals the strengths and weaknesses of Turkey and helps to draw concrete policy conclusions.