Exploring the System Dynamics of Innovation Systems

The innovation system is perceived as an ensemble of resources committed to interrelated innovation activities. The question arising is how the innovation system becomes one (a system), i.e., what are the mechanisms that govern the alignment of resources and activities in innovative directions. A system dynamics framework of analysis is presented where alignment stems from institutional arrangements and strategic intent. These operate as mechanisms of stretch and leverage within an environment of co-opetition and connexity. Central amongst them is the evolution of cognitive-cultural elements that, in the form of mental models (worldviews) and intangible assets (such as trust and co-opeting competence), drive economic action and interaction. A system dynamics modelling approach is proposed that facilitates the quantification and exploration of policy alternatives.