How Measures Innovation

Since Schumpeter’s work (1931), many authors have maintained the importance of technological change as source of competitive advantages in business and commerce. They agree that innovation is a source of growth (Solow, 1956; Romer, 1986; Nadiri 1993; Coe and Helpman, 1995; Wong et al. 2005). Simultaneously many others have emphasized the key role of the entrepreneur and his behavior in both innovation and diffusion of it. So we see innovation is studied in two different approximations: at a macro and at a microeconomic level. To a macroeconomic level, more innovation implies a higher competitiveness in the whole economy, but also the generation of technological innovations toward the rest of economic agents, which affects strongly the path of development followed by each country.

In this sense, an innovation system is a set of institutions that, jointly and individually, contribute to the development and diffusion of new technologies, and such institutions provide the framework within which governments form and implement policies to influence the innovation process.

We can use the IS approach –a descriptive tool that permits the enumeration of “this” set of institutions and- with the goal of analyzing the economy’s innovation capacity and output of a country. This method focuses on highlights interactions among various actors and the working of the holistic systems rather than the performance of its individual components. But this is not the unique tool, because we could measure innovation capacity focusing on the performance of individual components of an economy. Of course we should aggregate them later if we can provide a model that describes innovation capacity at a macroeconomic level. We can find other some tools for measuring the innovation capacity of a given industry, country or region, as for example: spending on R&D, number of patents, technical publications, income from intellectual property right, etc.

In the specialized literature, we cannot...