ABSTRACT
The national innovation system (NIS) approach, as a widely accepted analytical framework for industrial innovation on a national scale, suggests that a country’s innovative and economic performance depends largely on how diverse innovation actors relate to each other as elements of a collective system of knowledge creation and use. The current understanding of Taiwan’s NIS draws mainly on Taiwan’s catch-up model, referring especially to export-oriented ICT industrialisation, and gives special credit to government-sponsored applied research institutes, such as the Industrial Technology Research Institute (ITRI). However, Taiwan nowadays is promoting economic transformation and the digital economy, with a central focus on 5+N flagship innovative industries, including the Asian Silicon Valley Development Initiative for the IoT and smart cities, green energy (offshore wind power and other kinds of renewable energy), the biomedical industry, the defense sector (cybersecurity included), new agriculture (for example precision agriculture) and the circular economy. Following this, the Institute for Information Industry (III) has recently repositioned itself as a ‘Digital Transformation Enabler’, while ITRI tends to focus on systemic innovations, by taking an approach of ‘Open Innovation System Platform’ (OISP). There is increasing awareness that digitalisation is transforming innovation and that digital transformation brings challenges to innovation management and innovation policies.
Set against that backdrop, this chapter calls for a revisit to Taiwan’s NIS by examining the issue concerning what Taiwan’s transition from ICT industrialisation to the digital economy means to its innovation trajectory and innovation routines. Taiwan’s ICT industry is a legacy of its catch-up industrialisation, and it has to reinvent itself in order to evolve into the genuine ‘digital sector’ of the digital economy. For Taiwan to develop into a digital economy, the incumbents in the existing digital sector or new players from elsewhere have to master a variety of new digital technologies (hardware- or software-based), such as AI, the IoT, robotics and blockchain, and/or to harness the new technologies for innovative applications. This may enrich our understanding of the factors underlying industrial innovation in the era of the digital economy, especially for latecomer countries in transition. The chapter goes further to discuss some aspects of structural change in Taiwan’s NIS.
