Building an Innovation Ecosystem as an Alternative of Oil Sector Exports in Azerbaijan (on the basis of the study of Israeli practice)

Building a successful innovation ecosystem is a key factor in innovation, growth, and development, and it can be an alternative to reducing Azerbaijan’s dependency on oil exports. Formation of a favorable innovation ecosystem remains an essential policy priority for the government of Azerbaijan too. President of the Republic of Azerbaijan signed a decree on the establishment of the Innovation Agency under the Ministry of Transport, Communications and High Technologies of the Republic of Azerbaijan on November 6th, 2018. The Innovation Agency to be established in 2019 will be a coordinating body to draft and implement an innovation roadmap of an Azerbaijani ecosystem. This paper reviews world practice, including an Israeli practice of success to deduct results and models to build an ecosystem in Azerbaijan. The aim is to determine factors that made the Israeli ecosystem successful and study if these factors can be applied to the development and implementation of similar benchmarks in Azerbaijan. The methodology that is used for this research is the case study from Israel. Through systematic analysis and logical generalization, the paper analytically discusses and deducts conclusions from Israel’s experience to spell out some key public policy lessons.