The Evolution of Subject Approaches to Innovation Measurement, and Implications for New Innovation Indicators

This thesis addresses a need for further evaluation of existing and new innovation survey indicators, which now provide an important evidence base informing better policy approaches. The research focus is on indicators produced from large scale, economy-wide innovation surveys, which collect firm-level data, and move beyond traditional R&D, patent, and bibliometric approaches by providing a direct, „subject‟ approach to measurement. Such surveys are conducted in approximately 80 countries, producing numerous indicators, though many portray counterintuitive results, and are subject to various shortcomings. Consequently, this study seeks to explore how new indicators can improve understanding of innovation. Three indicator categories are assessed, using microdata from two iterations of a large regional innovation survey, the Tasmanian Innovation Census (TIC). Results examine three degrees of innovation novelty, and show that R&D activity and intensity provide good measures of innovation capability. Complex „mode‟ indicators reveal the distribution of innovation characteristics at a „system‟ level, across sectors, and for firms of different sizes, with linear, chain-link and systems theories all underpinning selected indicators. Using panel data, „output‟ mode indicators reveal specific movement of both innovative and non-innovative firms between four innovation modes, providing a dynamic understanding of capability development and erosion over time, and suggesting that innovation capability for the most part develops cumulatively. Innovation based on diffusion is shown as most common in services. Composite indicator results provide a simple, visual picture of sectoral innovation performance, demonstrating usefulness beyond the typical macro-level of analysis. Results and discussion expose issues around theory, policy and practice with implications for related future research, including a need for further work to standardise different indicators for degrees of novelty and capability, and for research to understand the links between innovation modes and economic outcomes.