The Role of International Networks in Upgrading National Innovation Systems

In small transition economies, domestic companies trust and rely on foreign innovators more than on home-grown technology. New publication co-authored by Max von Zedtwitz.


Based on a study of 131 R&D intensive companies in Lithuania, this paper shows that in small transitioning economies, local firms draw heavily on technology and innovation provided through international business networks, foreign lead users, foreign innovators, and even international competitors. The national innovation system is not directly driven by the innovation development strategies of domestic firms but mediated by technological learning from and trust in international innovation networks. While the role of national innovation systems remains important, its impact is reduced in small transitioning economies. As these have fewer resources to invest in domestic innovation and more limitations in experimenting with a variety of innovation policies tailored to the specific country needs, they may seek external solutions more readily than large transitioning economies with established legacy technologies.

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