Best Practices to Be an Innovation and Knowledge Economy

For a well-functioning innovation system, it is crucial to strengthen each component of the “ecosystem” in a systems approach. The business sector and entrepreneurs should be at the core of this ecosystem and interact robustly with all other actors. Research activities without business sector linkages will not yield the desired results, especially for the aim of escaping the middle-income trap. Therefore, it is mandatory to develop the correct set of support tools and mechanisms to manage a 'complex ecosystem', while strengthening even the weakest component. These mechanisms should also provide a particular emphasis to the process of commercialization. From the perspective of policy-making and policy design, this approach requires a strategic combination of both qualitative and quantitative policy tools.

Best Practices to Foster Entrepreneurship

One of the vital aspects of improving the efficiency of the R&D and innovation ecosystem is promoting entrepreneurship based on technological and innovation-driven research. Recently, many countries have realized that the main challenge for the innovation system is not the lack of knowledge or technology, but often the inability to drive these innovations to the market. This realization has resulted in a shift of focus in direct R&D funding among OECD countries. Most OECD countries have now channeled their funding opportunities across the entire R&D and innovation value chain, including the integrated processes leading to commercialization.

Direct support to aid commercialization includes support to encourage collaboration and knowledge transfer among or between firms and scientific institutions. It further includes direct support to foster the growth of high technology start-up firms, stimulate venture capital activity, and accelerate innovation activity relevant to societal challenges. Such forms of direct support allow governments to target specific barriers that persistently affect innovation performance. For entrepreneurship, these barriers may include the lack of co-operation, barriers for small businesses and individual entrepreneurs to commercialize, or high risk in areas that also have high social returns [13]. In this context, best practices to foster entrepreneurship are examined under the topics of techno-entrepreneurship, venture capital, and entrepreneurship culture. These best practices can further improve the ease of doing business within the ecosystem [14].

 
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