Tarmo Kalvet (PhD)

Title: ‘Innovation Policy and Development in the ICT Paradigm: Regional and Theoretical Perspectives’

Supervisor: Prof. Dr. Wolfgang Drechsler

Opponents: Dr. Marc Bogdanowicz, European Commission, Directorate-General JRC, Institute for Prospective Technological Studies (IPTS)

Professor Dr. Rein Vaikmäe, Tallinn University of Technology, Estonia

Defense: 14 April 2009

Abstract: Innovation policy forms a foundation, and probably the most important one, of economic development in any society, especially in today’s society driven by information and communication technologies (ICT). Although positive information-society developments in Estonia seem to confirm Estonia’s full adoption of the ICT paradigm, the central conclusion of the thesis is that in Estonia and other CEE countries, compliance with the previous technoeconomic paradigm can be observed and that those countries have not benefitted from the profound logic of the current ICT-led paradigm. They are under increasing pressures from de-agglomeration, de-linkaging, and dediversifying effects. Although innovation and innovation policy have moved into the centre of politics and public policy in the less developed member states of the EU, including Estonia, marking a change from the earlier “market-failure” centred approach, there are considerable problems. The principles of Schumpeterian economics are today generally intrumentalised in public policy via the concepts of a national innovation system and the need to address networking failures. However, the main problems of companies are related to the lack of absorptive capacities, resulting in less incentive to innovate other than by cutting costs. While innovation is taking place, it is specific and does not contribute to Schumpeterian creative destruction – destroying in order to build something new and better. Mainly using Estonia as a case study, the thesis concludes that the innovation policies widely applied in CEE countries are missing several crucial elements.

Keywords: innovation, economic development, innovation policy, ICT Paradigm,
open innovation, governance, dissertations.