Technology and Innovation Policies for Small and Medium-Sized Enterprises in East Asia
Intarakumnerd, Patarapong; Goto, Akira | July 2016
Abstract
Policies for stimulating technological development and innovation in small and medium-sized enterprises can be divided into three groups. Supply-side policies aim at increasing firms' incentives to invest in innovation by reducing costs. Demand-side policies are public actions to induce innovation and/or speed up the diffusion of innovation. Systemic policies focus on strengthening interactive learning between actors in innovation systems. Policies can be implemented through various instruments comprising tax incentives, grants or direct subsidies, low-interest loans, and the government's direct equity participation. These instruments have pros and cons. The experiences of four late-industrializing East Asian economies'Taipei,China; Singapore; Malaysia; and Thailand'provide key lessons. Firms at different levels of technological and innovative capability need different policy instruments. The more successful economies have a higher level of flexibility and policy coordination and learning. The amount, duration, and continuity of government supporting schemes are crucial. Policy makers must have a deep understanding of what constitutes innovations and innovation systems, and how they evolve over time. Innovation financing policies require other corresponding policy initiatives to make them successful. Lastly, institutional factors do shape the choices and effective implementation of these policies.
Citation
Intarakumnerd, Patarapong; Goto, Akira. 2016. Technology and Innovation Policies for Small and Medium-Sized Enterprises in East Asia. © Asian Development Bank Institute. http://hdl.handle.net/11540/6615.Keywords
Securities
Competition
Industrial competition
Unfair competition
Monopolies
Competition policy
Development cooperation
Economic discrimination
Industrial Development
Financial Services Industry
Industrial Sector
Industry
Development Economics
Economic Models
Organization for Economic Cooperation and Development
Automobiles
Competition
Comparative economics
Communication in economic development
Industrialization
Monopoly
Barriers to entry
Monopolistic competition
Restraint of trade
Price discrimination
Imperfect competition
Press monopoly
Diversification in industry
Unfair competition
Investment banking
Automobile industry
Automobile industry workers
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