ABSTRACT

In Part One, our historical account demonstrated the special characteristics of the British economy, technology, culture and political system, which enabled that country to forge ahead of the rest of the world during the Industrial Revolution (Table 12.1). In Chapter 3 we pointed in a similar way to some special features of the United States national system which enabled that country to overtake Britain and in its turn to forge ahead of other countries (Table 12.2). In later chapters, we pointed to some special features of the German and Japanese economies which enabled them to achieve very high growth rates in the twentieth century. All of these illustrate the point that the national environment can have a considerable influence in stimulating, facilitating, hindering or preventing the innovative activities of firms. In this chapter we examine the concept of the ‘national system of innovation’ and explore in particular the contrasting systems respectively in the former Soviet Union and in Japan. We also analyse the contrast between countries in Latin America and East Asia in their efforts to catch up with the leading industrial countries. This account leads on to the more formal and generalized discussion of technology and economic growth in the following chapter. Characteristics of British national system of innovation, eighteenth and nineteenth centuries https://www.niso.org/standards/z39-96/ns/oasis-exchange/table">

Strong links between scientists and entrepreneurs.

Science has become a national institution, encouraged by the state and popularized by local clubs.

Strong local investment by landlords in transport infrastructure (canals and roads, later railways).

Partnership form of organization enables inventors to raise capital and collaborate with entrepreneurs (e.g. Arkwright/Strutt).

Profits from trade and services available through national and local capital markets to invest in factory production especially in textiles.

Economic policy strongly influenced by classical economics and in the interests of industrialization.

Strong efforts to protect national technology delay catching up by competitors.

British productivity per person about twice as high as European average by 1850.

Reduction or elimmation of internal and external barriers to trade.

Dissenters’ academies and some universities provide science education. Mechanics trained in new industrial towns on part-time basis.

Characteristics of US national system of innovation, late nineteenth and twentieth centuries https://www.niso.org/standards/z39-96/ns/oasis-exchange/table">

No feudal barriers to trade and investment; slavery abolished 1865; capitalist ideology dominant.

Railway infrastructure permits rapid growth of very large national market from 1860s onwards.

Shortage of skilled labour induces development of machine intensive and capital intensive techniques (McCormick, Singer, Ford).

Abundant national resources exploited with heavy investment and big scale economies (steel, copper, oil).

Mass production and flow production as typical US techniques.

Strong encouragement of technical education and science at federal and state level from 1776 onwards.

US firms in capital intensive industries grow very large (GM, GE, SO, etc.) and start inhouse R&D.

US productivity twice as high as Europe by 1914.

Major import of technology and science through immigration from Europe.