The government provides financial support to private innovations for such firms as Sony due to the high risks involved as well as the heavy financial investments required. According to Wolf, the state has a strategic role to play in encouraging private firms and corporations to invest in intensified research and innovations for a number of reasons. These are the high costs associated with innovation and which often becomes a challenge to many firms, huge uncertainties as well as the long periods of time with which firms invest in innovation (Wolf, 2013, para 1-5).
Therefore, private firms are hesitant in investing in innovation because of this cost constraint as well as the uncertainties and risks associated. This has therefore promoted research and innovation through private firms through the provision of financial support. Nevertheless, there are policy frameworks that the NIS has put into place in the management of financial services offered to the firms. The general landscape, however, is favorable for innovation because the government has not put stringent measures for firms to access credit facilities. The US ‘ national innovation systems’ has been a very powerful tool for analyzing the innovative performance of the US as well as analyzing the policy frameworks developed and adopted within the country.
The NSI is composed of institutions, actors, processes that influence knowledge creation policies, the process of innovation, which translates research findings into applications (for commercial or nonmarket use), as well as the overall processes influencing the adoption of general innovations. This, therefore, confirms that the NSI comprises of Scientific and Technological institutions, as well as the Education components. Despite the fact that research universities are a relatively recent phenomenon within the United States, they have grown to become a critical component in innovation through training students on innovation, research as well as development.
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