The term National System of Innovation originated when Christopher Freeman and Bengt-Åke Lundvall worked together in the late 1980s. Freeman's research drew heavily on political economy of Friedrich List and his historical account of the rise of Japan as an economic superpower. Lundvall's work explored the important social interactions between suppliers and customers and their role in encouraging innovation in Denmark. Apart from a general definition, as above, there is no canonical definition of national innovation systems. A few dominant definitions are listed below which overlap quite a bit: A national system of innovation has been defined as follows:
.. the elements and relationships which interact in the production, diffusion and use of new, and economically useful, knowledge... and are either located within or rooted inside the borders of a nation state.
... a set of institutions whose interactions determine the innovative performance... of national firms.
.. the national institutions, their incentive structures and their competencies, that determine the rate and direction of technological learning in a country.
.. that set of distinct institutions which jointly and individually contribute to the development and diffusion of new technologies and which provides the framework within which governments form and implement policies to influence the innovation process. As such it is a system of interconnected institutions to create, store and transfer the knowledge, skills and artefacts which define new technologies.
A country’s innovative performance largely depends on how these actors relate to each other as elements of a collective system of knowledge creation and use as well as the technologies they use. For example, public research institutes, academia and industry serve as research producers carrying out R&D activities. On the other hand, governments either central or regional play the role of coordinator among research producers in terms of their policy instruments, visions and perspectives for the future. Furthermore, in order to promote innovation the different innovative actors must have strong linkages with each other based on a strong level of trust and governments should promote and activate trust among the different innovation actors. The linkages can take the form of joint research, personnel exchanges, crosspatenting, and purchase of equipment. Finally, NSI are shaped by distinct socio-cultural qualities of national communities. Therefore, there are national trajectories of innovativeness, technology orientation and learning, which results in each nation, either highly developed or not, having some kind of NSI, no matter if working well or not. Further more, the Success factors of NSI have been seen by many scholars in the creation of supportive institutions and organizations and collaboration linkages Bridging Scales in Innovation Policies throughout the various elements that constitute a NSI. Examples include public R&D and companies, as well as common objectives and innovative cultures of agents, altogether entailing self reinforcing progress and synergies. Differences in the structures and strategies of NSI among various economically successful countries indicate however, that there is no universal best practise recipe.
