From economic foundations to S&T policy tools: A comparative analysis of the dominant paradigms

Abstract

The objective of this chapter is to analyze the economic rationale behind science and technology (S and T) policies. Reference will be made to concepts and ideas stemming from works in other fields, such as management sciences, sociology, etc. For the purpose of this analysis, we first identify the main theoretical frameworks on the basis of which innovation related phenomena are currently analysed in economic terms. Next, we identify for each fi'amework, the justifications for State intervention as well as the main forms that this intervention might take. In order to simplify the presentation and the very subtle, complex, and sometimes controversial scholarly debate (Limdvall and Borras 1997)^ two main frameworks are distinguished: the neo-classical (NC) and the evolutionary-structuralist (ES), which adopt different approaches that highlight specific aspects. The following questions are addressed in relation to each framework:-main features, especially regarding innovation;-the "circumstances" in which the innovation processes do not work well or fulfil the role they are designed for, and the consequences of these socalled "failures";-the principles of State intervention designed to remedy these failures, illustrated by the most representative types of S and T policy action that can be adopted. (Frameworks are heuristic tools rather than the basis for di-rectly operational policy advice; a detailed description of these is beyond the scope of this present work);-the main problems raised by these principles when they are implemented into real actions; government failures are included here. Broadly, it will be assumed that each framework provides rationales for science policy, technology policy, and also, more generally, for innovation policy (and even for other types of policy, e.g. competition policy, trade policy, education policy, and so on). In other words, the hypothesis is that within each framework, the rationales behind every policy are the same. For this reason (from an analytical point of view) we have not separated science policy from technology policy. However, the combinations of these different policies and the frontiers between them vary from one framework to another. In Sections 1 and 2, we present the two frameworks and their implications for S and T policy. As most of the elements of this analysis are well docimiented in the literature, we focus only on the main aspects, or those aspects that are not always highlighted. Tables 1.1 to 1.2 summarize the analysis. Table 1.1 presents the main features of each framework; Figure 1.1 presents the types of "failures" connected with each, framework as well as the basic principles of S and T policy, central to each framework, that are designed to remedy such failures; Table 1.2 shows how the main types of S and T policy actions can be seen as specific applications of these principles. (The way this is presented allows comparison of the underlying principles on the basis of which real, although archetypal, policy actions are formulated.) Section 3 is devoted to one key point underlying the question of State intervention: the additionality problem. We conclude by offering some comments about the complementarity of the two frameworks and a comparison of the policy principles and policy actions resulting from each. © Springer-Verlag Berlin Heidelberg 2005.