Geography Reference
In-Depth Information
innovators or innovating firms. The classical economic theories of the firm, with
their limiting assumptions, such as those of rationality, perfect knowledge and an
emphasis upon states of equilibrium, have proved of little value in understanding in-
novative processes (Hodgson 1996 ). More relevant insights are emerging from the
evolutionary approaches adopted by investigators who have studied the actual ex-
perience and patterns of people and firms involved in innovative activity. What has
been increasingly obvious from these studies is that innovation depends more on the
application of knowledge than any other economic activity. This explains why the
processes involved in the creation of inventions and innovations have proved more
difficult to understand than the assembly of the factors of production in any location
to produce material goods. However research has revealed that four main sets of
factors seem to be involved in the location of innovative processes: the characteris-
tics of invention and innovation; the uncertainties to solve; the way that knowledge
is accessed; and the degree of encouragement for innovative activity.
11.5.2
Invention and Innovation Characteristics
The processes of invention and then innovation into final goods rarely involves a
simple linear route or sequence. It is quite unlike established businesses which are
organized for predictability, often breaking tasks down into their various parts, as
well as ensuring that employees complete these tasks. Instead, invention and in-
novation is a high risk, non-linear process that is uncertain and unpredictable. They
usually involve complex feedbacks, as well as a lot of trial and error, have many
dead-ends, and more failures than successes. So most successful inventions do not
come from some sudden 'flash of insight' or Eureka moment of popular imagina-
tion—although this might start the process—but from organized and purposeful
approaches that involve lots of hard work and the fortitude to overcome setbacks.
There is often a compulsive behavioural trait in inventors and innovators to suc-
ceed, as well as crucial interactive contacts with other people who have special
skills and knowledge. Johnson ( 2011 ) has reviewed the ways that inventions de-
velop and showed there is no single path. Instead he identified seven main ways that
new ideas—frequently the first or inventive stage—have been created, although
sometimes there are overlaps between these alternatives. The first three of his paths
to invention are related to the locational contiguities of major actors in the inventive
process that provides the breakthrough in ideas.
The 'adjacent possible' is the type of process by which a new idea arises as
an extension from a previous one, such as the various modifications from steam
pumping engines in mines that led to the development of steam powered engines
on rails and roads, and subsequent applications in many different areas in factories
and transport systems. 'Liquid networks' are situations in which tacit information
is derived from surrounding people, whether coffee shops in the development of
London's financial markets in the seventeenth century, or in Silicon Valley today,
enables an inventor to make a new breakthrough. 'Platforms' refers to those situa-
tions in which the invention, or subsequent innovation, is based on essential inputs
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