The national and regional innovation systems in Finland: from the path dependency to the path creation approach

A new economic order based on globalization and localization processes has changed the fundamental economic systems. Particularly, the Finnish national economy was affected by the reformation of the global economic system in the beginning of the 1990s. This resulted in a severe economic recession in the mid1990s. In fact, the suffering from the economic recession started with the collapse of the former Soviet Union, which was one of the largest trade partners for Finland. Additionally, the globalization processes made the national economy worse. In order to overcome such an economic recession as soon as possible, all economic actors tried to reshape their organizations and adapted the processes of de-regulation and free competition in the markets. Under these circumstances, a consensus on the new growth strategy emerged, and government and industry began to emphasize technology and innovation as the basis of economic growth in the future (Ministry of Trade and Industry 1996). As a result, the technologyand innovation-oriented growth strategy was complemented by an emphasis on the new efficiencyand competitiveness-oriented role of the government. With the severe economic crisis in the mid-1990s, the technologyand innovation-oriented growth strategy was regarded as necessary for Finland to implement because the Finnish economy was increasingly exposed to foreign competition. This means that Finland could not compete with other advanced nations without having world-class innovatory capacity, efficiency, and valueadding capacity (Schienstock and Hämäläinen 2001). In order to strengthen the national competitiveness, academia, industry, and government have cooperated with one another. As a result, Finland became the most competitive among 102 nations in the world in 2003 (World Economic Forum 2003). In the collaboration between the actors, Finland initiated a new approach based on endogenous and generative growth that replaced the tradi-