ABSTRACT
Yet while much is now known about the way R&D can spill over from science insti-
tutions across actors to generate increasing economic value through innovation (as the
STI mode), this is not universal and can operate in vastly different ways, depending on
local knowledge and industrial make-up. It is also considerably different to the DUI
mode of innovation. Second, the current approach to researching innovation using technol-
ogy indicators such as R&D, patents and formal innovation partnerships underestimates
the extent of innovation in any given area; a point the OECD (2005) concurs with in its
assessment of the extent of innovation in the UK, relative to other countries. One of the
UK’s strengths is in knowledge-intensive services, especially creative industries, in
which innovation has been fundamentally underestimated using existing indicators
(DIUS, 2008). In these areas, technology indicators and accountancy methods have under-
played the more important issues of problem-solving, know-how and know-who capabili-
ties, semiotic knowledge, networks and other context-specific factors which are important
in creating synthetic and symbolic knowledge (e.g. niche manufacturing, creative indus-
tries). The overall effect has been one of portraying economic knowledge, activities and
value within an undersocialized framework, which acknowledges the role of human
action but fails to capture this in any convincing or meaningful way. In other words, it
fails to capture the importance of social relations as a type of relational capital. While
there has been a growing acceptance of relational capital in some disciplines, this is not
manifest in mainstream approaches or research studies in innovation fields.
