Neoclassical vs Evolutionary Economics Shared points Technological and

Neoclassical vs Evolutionary Economics Shared points • Technological and scientific opportunities of a specific industry influence the innovation rate; • Economic incentives play a key role in innovation: e. g. high “appropriability” determines high R&D expenditure and low innovation diffusion rate; • Demand level counts (high demand >>> High R&D expenditure) • Direct relationships between monopolistic power (market structure) and innovation rate; market structure and Technological development are linked

Neoclassical vs Evolutionary Economics Divergences: • Economic Equilibrium (N) vs Non-equilibrium status (E) • Static and dynamic models; weak attention to how equilibrium is reaches (N) vs innovation processes/dynamics, transition (E) • Technology mainly as “information” (N) vs Technology as multidimensional entity, related to “knowledge” (E) • Focus on Firm Strategy (N) vs attention to competences, behaviors, firm organization, types of company (E) • Firms are considered as independent from the context (history, institutional setting, etc. ) (N), vs firms as subjects embedded in the technological, sectoral, institutional setting (E). • Substantial rationality – perfect information and maximizing behavior - (N) vs bounded rationality with only satisfying behavior (E) • Market failures – public goods - in R&D activity, with IPR and subsidy as public solution (N) vs more articulated and reach of trade-offs framework for public intervention, with more attention paid to roles played by institutions and innovation (national) systems (E).