果冻影院

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果冻影院 Institute for Innovation and Public Purpose (IIPP) Working Paper Series: IIPP WP 2017-02

Author

• Richard R. Nelson聽| George Blumenthal Professor of International and Public Affairs, Business, and Law, Emeritus, Columbia University, New York

Reference

Nelson, R. (2017).聽Thinking About Technology Policy: 鈥楳arket Failures鈥� versus 鈥業nnovation systems鈥�. 果冻影院 Institute for Innovation and Public Purpose, Working Paper Series (IIPP WP 2017-02). Available at:聽/bartlett/public-purpose/wp2017-02

Summary

This paper compares two different theoretical frameworks in economics for orienting analysis of issues in technology policy. One is a neoclassical framework that sees appropriate policies as dealing with 鈥渕arket failures鈥�. The other framework is provided by an evolutionary and institutional approach to economic analysis that sees appropriate policies as building or maintaining an effective 鈥渋nnovation system鈥�. The paper lays out the key general differences between the two broad theoretical frameworks, and how they lead to different perspectives on technology policy. The paper then focuses technology policy regarding pharmaceuticals as a case study illustrating the different approaches. The conclusion comments on the general role of economic theories in framing policy analysis.

This working paper is a reprint from an article that Richard Nelson published in聽2009.聽We have reprinted it, with his permission through his collaboration with us on the mission oriented framework, to remind students and practitioners of this important piece of work that delineates the limitations of market failure theory and the need for an evolutionary-institutional framework with markets understood as outcomes of complex social, political and institutional forces.