Social Construction of Technological Innovation (Theoretical Analysis and Policy Recommendations for Establishing a Sound National Innovation System)

Author: An Weifu
Publisher:
Publish Date: 2003-05-01
Features: 2.3 The Social Function of Technological Innovation
The essence and structure of the modern scientific and technological revolution are "socially constructed" national innovation systems. The purpose of establishing and improving a national innovation system is to solve some major problems in modern society: market failure, systemic failure, government failure, and so on. Establishing and improving a national innovation system may solve these problems to some extent. Rather, it is precisely to solve these problems. It helps to solve the market failure problem.
Market failure refers to the situation where, under market mechanisms, "the expected private return rate of innovation by firms is not aligned with the social return rate. From a social perspective, due to the too low private return rate of innovation, firms are unwilling to innovate." As the American steel magnate Carnegie said, "Leaders do not get rewarded." For developing countries, market failure has profound implications. The market failure in developing countries has two meanings: First, due to various political and economic reasons, the market mechanisms in developing countries are not conducive to technological innovation. Second, international trade relations, especially unfair technology trade, are disadvantageous to developing countries. To solve the market failure problem, the traditional remedy is: ① Strengthen the role of the government in technological innovation; ② Establish and improve intermediary institutions between the knowledge field and economic activities; ③ Increase the intensity of basic research; ④ Expand technology trade; ⑤ Open high-tech parks, and so on. For diagnosing market failure, these remedies have played a certain role for a certain period, under certain conditions, and to a certain extent. However, these remedies also have their own limitations. For example, increasing the intensity of public interest knowledge research can certainly alleviate the direct or indirect of market mechanisms on non-profit knowledge, but it often leads to public interest knowledge research increasingly deviating from the supply and demand environment of economic and social development. This is neither conducive to public interest knowledge research promoting economic and social development, nor conducive to economic and social development driving the progress of public interest knowledge research. We believe that establishing and improving a national innovation system can fully leverage the driving role of market mechanisms while effectively preventing the negative effects of market failure. This is because the national innovation system scientifically resolves the inherent contradiction between the public nature of technology and its private characteristics. In the national innovation system, "technology and some of its aspects are partially characterized as public goods. The public and private aspects of technology complement and coordinate with each other."