Abstract
The essay considers the role of big private businesses (BBs) within the Brazilian national system of innovation (NSI). Our question is as follows: How do the innovation practices and political behavior adopted by BBs shape the Brazilian NSI? It is our claim that although BBs play a prominent role in leading innovation nationally, they are not supportive of institution-intensive solutions for strengthening the NSI, and thereby contribute to the creation of a dynamic that we call the ‘low-innovation trap’. The obstacles to escaping this trap are manifold, but here we shall focus on 01. the lack of coordination between actors and instruments within government, 02. the high level of instability in the Science, Technology and Innovation (ST&I) budget, 03. the increasing obstacles faced by BBs wishing to innovate and 04. the lack of correspondence between government proposals and societal demands. Without a strong coalition pushing for it to be upgraded, it is likely that the NSI will remain unfit for purpose.
Highlights
The essay considers the role of big private businesses (BBs) within the Brazilian national system of innovation (NSI)
Based on an evolutionary economic approach (DOSI et al, 1988; NELSON and WINTER, 1982), the literature suggests that during the catching-up process it is to be expected that a certain amount of temporal mismatch between universities, research institutes and the productive sector may occur as a consequence of the cutting-edge knowledge produced and adopted by ST&I actors (ALBUQUERQUE et al, 2015)
Compared to its peers in Latin America and the Caribbean and other less-developed countries (LDCs), Brazil has managed to develop a considerable amount of State capabilities and has been able to strengthen private actors by means of supporting domestic BBs and attracting foreign direct investment (FDI) – during the heydays of the import substitution industrialization regime and after liberalization (HIRATUKA, COUTINHO, and LAPLANE, 2003)
Summary
The essay considers the role of big private businesses (BBs) within the Brazilian national system of innovation (NSI). Our claim is that because the co-evolutionary process of mismatches between ST&I actors and firms may generate conflicts and pressures for structural and institutional changes, strengthening the NSI requires the support of a strong coalition that embraces the uncertain pace of technological change For this reason, the answer to the question regarding the opportunities for climbing the technological ladder must, in our view, consider the political sphere. Governments cannot count on them to support institution-intensive solutions that could enable a country to exit the trap Due to their advantages of scale and scope, BBs are expected to be leading agents of innovation because they tend to be more efficient in developing new technologies than smaller firms (COHEN, 2010; COHEN and KLEPPER, 1996; NELSON and WINTER, 1982). Firms cannot invest in additional R&D if the duration of government support is uncertain (GUELLEC and POTTERIE, 2003)
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