Primary aim: Give an example of ”adaptive policy making” A "Joint Problem-Solving Process" for the implementation of innovation policies

Perspective on Innovation Policy In view of the innovation process: Theory on privatization of information (patents) insufficient Face-to-face interaction in the production of innovative input Public good properties of knowledge Externatilies in production Creattion of networks and Regional Innovation Systems important Difficult to enforce institutions for patents Aoki’s theory of instituional change Partnerships between universities and industry Aoki’s theory of instituional change In view of the public policy process: Witt’s and Gerybadze’s articles on policymaking

Joint Problem-Solving Process (JPSP): The political agent (“agent of collective action”) is endogenized, i.e. participates in the market by suggesting solutions to problems through an interactive relationship Takes into account : Conditions for decision-making in the firms Technologies are characterized by externalities Circumstances surrounding politics Dominant groups are interested in preserving old technology Legitimacy “Lock-in”

Results 1 – 2: 1.Even though y is optimal if chosen by all firms, the expectations that a majority of firms will not opt for y will cause most firms to remain hesitant. As a result, the “critical mass” will not be attained 2.Diversity within a population of firms will trigger a switch to y. If there are enough innovating firms, they will generate an adaptation process through which the “critical mass” will be attained.

Behavioral principles for a “political entrepreneur”: Collecting information about potential agents and their expectations and choices. Subdivision of industrial innovations (Result 3) Collecting information about possible opportunity sets of political instruments and about new combinations of policies (Result 4) A new form of organization that economizes on information and transaction costs. A coordinator is selected, who knows both government and industry well enough, who can mobilize existing communication links to both sides (Result 5)