Innovation, knowledge creation and systems of innovation

The main objective of this paper is to provide greater understanding of the systems of innovation approach as a flexible and useful conceptual framewo rk for spatial innovation analysis. It presents an effort to develop some m issing links and to decrease the conceptual noise often present in the disc ussions on national innovation systems. The paper specifies elements and re lations that seem to be essential to the conceptual core of the framework a nd argues that there is no a priori reason to emphasize the national over t he subnational (regional) scale as an appropriate mode for analysis, irresp ective of time and place. Localised input-output relations between the acto rs of the system, knowledge spillovers and their untraded interdependencies lie at the centre of the argument. The paper is organized as follows. It introduces the reader, first, to some basic elements and concepts that are central to understanding the approach . The characteristics of the innovation process are examined: its nature, s ources and some of the factors shaping its development. Particular emphasis is laid on the role of knowledge creation and dissemination based on the f undamental distinction between codified and tacit forms. These concepts rec ur throughout the paper and particularly in discussions on the nature and s pecifications of the systems approach. The paper concludes by summarizing s ome of the major findings of the discussion and pointing to some directions for future research activities.