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Demand-Driven Innovation: An Integrative Systems-Based Review of the Literature

Author

Listed:
  • Amnon Frenkel

    (Samuel Neaman Institute for Advanced Studies in Science and Technology, Faculty of Architecture and Town Planning, Technion, Haifa 32000, Israel)

  • Shlomo Maital

    (Samuel Neaman Institute for Advanced Studies in Science and Technology, Technion, Haifa 32000, Israel)

  • Eran Leck

    (Samuel Neaman Institute for Advanced Studies in Science and Technology, Technion, Haifa 32000, Israel)

  • Emil Israel

    (Samuel Neaman Institute for Advanced Studies in Science and Technology, Technion, Haifa 32000, Israel)

Abstract

In this paper, we provide a comprehensive review of the literature on demand-driven innovation, using a generic national innovation ecosystem map as a unifying framework. We organize the literature review around four key innovation dimensions and seven related demand-driven processes. Our review reveals that business networking which accelerates access to new markets and technologies is vital for free markets. But classical competition alone cannot sustain the creation of new technologies or innovation paths. Rather, national policy is essential in creating lead markets. On the other hand the private sector has a crucial task in leading R&D activity. We found that the relationship between R&D stock and productivity is mostly positive. With regard to cluster strategies our literature review suggests that increased variety of innovative activities strengthens regional economic growth through "spillover effects" between products and industries. Based on the literature, we found that universities are evolving to play a major role in the research of innovation. The enormous innovative potential of universities therefore should be directed toward shaping more effective tools for public–private cooperation. But innovation, whether its origin is in academe or elsewhere, must follow a standardization process in order to converge into a well-defined technology. Our paper highlights a fundamental paradox underlying pro-innovation policies: while innovators often express the desire for a liberal, open and flexible market system with minimal bureaucracy and governmental interference, to allow market-driven innovation to flourish, they often benefit greatly from a variety of governmental interventions that include direct or indirect financial support (such as tax credits).

Suggested Citation

  • Amnon Frenkel & Shlomo Maital & Eran Leck & Emil Israel, 2015. "Demand-Driven Innovation: An Integrative Systems-Based Review of the Literature," International Journal of Innovation and Technology Management (IJITM), World Scientific Publishing Co. Pte. Ltd., vol. 12(02), pages 1-31.
  • Handle: RePEc:wsi:ijitmx:v:12:y:2015:i:02:n:s021987701550008x
    DOI: 10.1142/S021987701550008X
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    References listed on IDEAS

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    1. Amnon Frenkel & Shlomo Maital, 2014. "Mapping National Innovation Ecosystems," Books, Edward Elgar Publishing, number 15408.
    2. Silvia Ardagna & Annamaria Lusardi, 2010. "Explaining International Differences in Entrepreneurship: The Role of Individual Characteristics and Regulatory Constraints," NBER Chapters, in: International Differences in Entrepreneurship, pages 17-62, National Bureau of Economic Research, Inc.
    3. Patricia M. Danzon & Andrew J. Epstein, 2012. "Effects of Regulation on Drug Launch and Pricing in Interdependent Markets," Advances in Health Economics and Health Services Research, in: The Economics of Medical Technology, pages 35-71, Emerald Group Publishing Limited.
    4. Laura Bottazzi & Giovanni Peri, "undated". "Innovation, Demand and Knowledge Spillovers: Theory and Evidence from European Regions," Working Papers 153, IGIER (Innocenzo Gasparini Institute for Economic Research), Bocconi University.
    5. Eric von Hippel, 2006. "Democratizing Innovation," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262720477, December.
    6. Amnon Frenkel & Peter Nijkamp & Philip McCann (ed.), 2012. "Societies in Motion," Books, Edward Elgar Publishing, number 14707.
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    Cited by:

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    2. Adarsh Anand & Richie Aggarwal & Ompal Singh, 2019. "Using Weibull Distribution for Modeling Bimodal Diffusion Curves: A Naive Framework to Study Product Life Cycle," International Journal of Innovation and Technology Management (IJITM), World Scientific Publishing Co. Pte. Ltd., vol. 16(07), pages 1-17, November.
    3. Edler, Jakob, 2023. "Demand, public procurement and transformation," Discussion Papers "Innovation Systems and Policy Analysis" 79, Fraunhofer Institute for Systems and Innovation Research (ISI).
    4. Jakob Edler, 2023. "Demand, public procurement and transformation," MIOIR Working Paper Series 2023-03, The Manchester Institute of Innovation Research (MIoIR), The University of Manchester.
    5. Fuster, Elena & Padilla-Meléndez, Antonio & Lockett, Nigel & del-Águila-Obra, Ana Rosa, 2019. "The emerging role of university spin-off companies in developing regional entrepreneurial university ecosystems: The case of Andalusia," Technological Forecasting and Social Change, Elsevier, vol. 141(C), pages 219-231.
    6. Cristina Caterina Amitrano & Marco Tregua & Tiziana Russo Spena & Francesco Bifulco, 2018. "On Technology in Innovation Systems and Innovation-Ecosystem Perspectives: A Cross-Linking Analysis," Sustainability, MDPI, vol. 10(10), pages 1-15, October.
    7. Antonella Biscione & Raul Caruso & Annunziata de Felice, 2021. "Environmental innovation in European transition countries," Applied Economics, Taylor & Francis Journals, vol. 53(5), pages 521-535, January.

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