ABSTRACT
Governments across the world are implementing policies to transform the economic base towards high-value products and services. Innovation policy has been inspired by the success of Silicon Valley based on its proximity to an excellent source of research, principally at Stanford University, and the clustering of high-technology companies in the region. Nevertheless, policies often fail to achieve their intended outcomes because the process of knowledge transfer is very complex and not well understood by policy makers. The outcomes of policy are unpredictable and the implementation of innovation processes involves cultural change in organizations, and it is difficult to manipulate this by policy.
