They may also reinvent products in the process of adoption and use. If the infrastructure is the supply side of innovation, consumers are the demand side. Understanding people and culture is also important for analyzing the entrepreneurial culture in the region. Attitudes toward risk and failure are an important parameter of the innovation climate in the region. Information Flows Innovation depends on the flows of people, ideas, money, and technology.
Good flows are important for two reasons.
First, places that bring together people with different ideas, cultures, and backgrounds are traditionally more innovative than places that are more isolated. Not surprisingly, ports and other cities that serve as meeting places for different people have produced the more important innovations throughout history, from Athens in the 5th century BC to Silicon Valley today. Second, regions that are more connected to the outside world are in a better position to bring in innovations from outside and to diffuse innovations originating in the region outside. Analyzing flows of information into and out of a region therefore helps us to forecast whether trends in the region will have larger implications or whether they are unique and have little chance of being taken up elsewhere. All rights reserved.