National Innovation Ecosystems: The Similarity and Disparity of Japan-Us Technology Policy Systems toward a Service Oriented Economy

By Watanabe, Chihiro; Fukuda, Kayano | Journal of Services Research, April-September 2006 | Go to article overview

National Innovation Ecosystems: The Similarity and Disparity of Japan-Us Technology Policy Systems toward a Service Oriented Economy


Watanabe, Chihiro, Fukuda, Kayano, Journal of Services Research


Coinciding with the announcement of the National Innovation Ecosystem proposed by the US Council on Competitiveness, Japan's Industrial Structure Council proposed a significant shift from a technology policy to an innovation policy based on the ecosystem concept. Aiming at analyzing the complex mutual relations between human activities centered around industry and the surrounding environment, Japan's Ministry of International Trade and Industry postulated the concept of Industrial Ecology in the early 1970s. In the US, a similar policy was initiated by the National Academy of Engineering in the early 1990s corresponding to the mutually inspiring cycle in the two nations. The basic principle of Industrial Ecology suggests substitution among available production factors in a closed system in order to achieve sustainable development under certain constraints. Based on this concept, Japan achieved notable energy efficiency improvement in the 1980s that can be attributed to technology substitution for energy. Contrary to its economic stagnation in the 1980s, the US achieved significant economic development in the 1990s while Japan experienced a "lost decade" due to economic stagnation. The US success can be attributed to information technology (IT) substitution for traditional manufacturing technology, leading to new functionality development. However, after the bursting of the IT bubble, the US has been confronting again the "new reality." While the US and Japan demonstrated contrasting success through mutual inspiration, given a new paradigm in a post-information society toward a ubiquitous society in the early 2000s. They need a new approach for sustaining their national innovation. Recognition of this led both countries to re-examine the broader application of the ecosystem discipline, leading to the National Innovation Ecosystem concept. This paper, based on an empirical review of the technology policy of the US and Japan over the last three decades focusing on the ecosystem perspective, attempts to demonstrate the above hypothetical view and provides new insight for a service oriented economy.

(ProQuest-CSA LLC: ... denotes formulae omitted.)

INTRODUCTION

Coinciding with the announcement of the National Innovation Ecosystem proposed by the US Council on Competitiveness, Japan's Industrial Structure Council proposed a significant shift from a technology policy to an innovation policy based on the ecosystem concept.

Aiming at analyzing and evaluating the complex mutual relations between human activities centered around industry and the surrounding environment, Japan's Ministry of International Trade and Industry (MITI)1 postulated the concept of Industrial Ecology in the early 1970s (Watanabe, 1972; 1994). Similarly in the US in the early 1990s there was an initiative by the National Academy of Engineering (Erkman, 1997).

The basic principle of Industrial Ecology suggests substitution among available production factors in a closed system in order to achieve sustainable development under certain constraints. Based on this concept, Japan achieved notable energy efficient improvement in the 1980s that can be attributed to technology substitution for energy (Watanabe, 1995, 1999).

Contrary to its economic stagnation in the 1980s, the US achieved significant economic development in the 1990s while Japan experienced a "lost decade" due to economic stagnation. The US success can be attributed to information technology (IT) substitution for traditional manufacturing technology, leading to new functionality development corresponding to a requirement of the shift from manufacturing technology based growth oriented trajectory to IT driven new functionality development initiated trajectory in an information society that emerged in the beginning of the 1990s.

Both the US and Japan demonstrated contrasting success through mutual inspiration during the 1970s, 1980s and 1990s including the postulation of the concept of Industrial Ecology in the early 1970s and 1990s, respectively. …

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