Collaboration is important for innovation at all stages of knowledge production. The increasing specialisation of scientific disciplines and the increasing complexity of research encourage scientists to engage in collaborative research.

Public research has always been an important part of innovation systems and the source of significant scientific and technological breakthroughs. Effective linkages between public research institutions and industry are necessary to optimise the benefits from research.

While different forms of innovation activity may occur in all regions, R&D-based innovation is geographically concentrated. Industrial structure, research capabilities and other territorial characteristics affect the capacity of actors to generate and absorb knowledge. Governments increasingly focus on regional clusters of innovation.

Investing in innovation is risky. Several R&D projects will not result in an invention, and not all patent applications will be novel enough to receive a patent.

Circulation of knowledge – in particular international circulation of knowledge – has increased over time and is now an important component of technology transfer. Well-designed knowledge networks and markets can reduce transaction costs, enable new knowledge transfers and make existing transfers more efficient.