National Innovation System in small states: New metrics 

It is argued that innovation in small nations is underpinned by networks and flow of knowledge among many entities including public, private and civil society. Research on small country innovation systems as is evident in the case of Singapore, Finland, and Bahrain reveals that metrics for innovation in small nations (defined as ones with  a populations between 1.5- 10 million) is  not measured by conventional indicators like population, geographic area, and GDP but by knowledge flow, industrial policy, governance of R&D, and human capital.

However, another way to look at the innovation capacity is to measure GDP per capita. This measure shows that countries like Kuwait and Singapore are classified as part of high-scale nations. This implies that small nations are qualified to be classified as innovative under the conditions they have sound investment in R&D per capita that result in growth. This means that limited natural resources is not a constraint since small nations can be overcome scarcity of resources by providing an enabling environment that supports cultural diversity, knowledge absorption from global networks, and industrial policies to promote FDI and export of technology. 

In a globalized market economy, small nations as well as SMEs face the challenge posed by multinational enterprises. To be able to contribute to innovation, small nations need to develop their technological infrastructure and alliances in R&D. The case of bio-technology policy in Estonia showed positive results in terms of enhancing innovative capacity through technology transfer. This can be explained by the fact that small countries have the advantage to induce favorable business opportunities and conditions for collaborative networks in science and technology at regional and global arenas. 

Besides, research shows that FDI and innovations clusters can contribute to a country’s core competences when aligned with a national strategy for innovation. In essence, small countries can leapfrog and catchup since they have some advantages in being focused, flexible, and dynamic in framing their innovation strategy. However, necessary conditions for success include transparency and good governance. 

At the regional context, regional enterprises in GCC in the fields of education and industry like the case of Arabian Gulf University, Alba and GPIC represents a good example of regional cooperation to enhance competitiveness and sustainability. This calls for more focused regional alliances in science, technology and innovation to establish a critical mass of scientists and researchers to make breakthroughs.  

The EU experience in national innovation system is insightful. For example, the Finnish model was underpinned by seamless cooperation among industry and academia and quality education. This model was adequate due to its capacity to attract foreign investment and form clusters and networks. Another good example was set by Singapore and Ireland which was founded by FDI, transfers of technologies, education and industrial policy, science alliances, and entrepreneurship. In sum, the success of small-scale national innovation systems is dependent on harnessing human and social capitals and aligning economic and innovation policy.