National Innovation System in Australia

Topics: Economy of Australia, Australia, Government of Australia Pages: 7 (2181 words) Published: December 3, 2013


BUSI 1358
Global Enterprise and Innovation

National Innovation System in Australia

Student name:

Date of submission:
30th November 2013


1. National Innovation System in Australia
The National Innovation System (NIS) means the flow of technology and information among people, enterprises and institutions which is the key factor for the innovative process on the national level (Edquist, 1997). With the development of innovation, it will affect the technology and generate a complex set of relationships among enterprises, universities and government (OECD, 2012). This report focuses on the NIS in Australia, and tries to find out how the NIS in Australia affects business. First, we will identify and discuss the main features of the business environment in Australia; second, we will analyze NIS in Australia from serval aspects such as government support, finance support, and scientific and technological institution; last, we will focus on the innovativeness of the main industrial sector—service industry of Australia. 2. Main Features of Business Environment in Australia

2.1. Strength, Stability and Open Government
Australia has a strong and diverse economy. With a high consuming, commercialized and diverse, Australia is also recognized as the “test market”. A lot of multinational companies provide the service and goods in Australia to test the market before expanding into Asia or other global markets. Appendix 1 shows about Australian Real Gross Domestic Product (GDP) Growth by economic grouping (AEO, 2012). Compared with the other developed countries, the average growth rate in Australia is highest. It means that Australian economy is strong and offers huge opportunities for the Foreign Direct Investment (FDI). Australia can set a low risk business environment based on the political and economic stability (Australian Government, 2012). It also possesses flexible, accountable financial practices, open regulation and transparent government policy (World Bank, 2011). In Australia, common law and statute are mixed for the legal system. In front of the law, all companies are placed in the same level. Moreover, in the Asia-Pacific, the Australian intellectual property protection is ranked in the second position. 2.2. Language

English is the official language in Australia. However, Australia is a multicultural society so that many other languages can be spoken, especially in main hub cities. The other languages include Greek, Italian, Chinese, Arabic, Spanish, French and Japanese. This phenomenon makes the business easier for the foreigners and attracts more FID. 2.3. Competitive Business Costs

Compared with the other cities such as Seoul, Tokyo, Hong Kong, London, Paris and Singapore, Australia provides a global city office location with the lower costs. Additionally, Australia will offers some benefits such as the low wages for high trained labor and economical operating (Wei and Zhao, 2012). 2.4. World Class Infrastructure and Communications

Australia possesses a world class telecommunications infrastructure and the networks consist of fiber-optic, wireless, satellite and microwave systems. The main communication way was through fiber optic (Scott, 2012). Dense wave division multiplexing is considered as the major networks which is used to enable an easy upgrade. 3. Australian Government Foster Innovation

3.1. R&D Tax Incentive
Since 1st July 2011, Australia carried out the new R&D tax incentive, which focused on three aspects. One is that some eligible R&D entities, which are less than $20 million in turnover per year, can get 45% refundable tax offset (Australian Government, 2012). The second one is that some foreign owned R&D have certain preferential policies such as 40% or 50% tax offset which depends on the group turnover (Commercialization Australia, 2012). The last one is for some projects which are about...

References: Australian Bureau of Statistics (2012) Key Economic Indicators. Available at: (Accessed: 21 November 2013).
Australian Economic Outlook (2012) Australian Real Gross Domestic Product Growth. Available at: (Accessed: 21 November 2013).
Australian Government (2012) Australian Innovation System Report. Sydney: Innovation Research Council.
Australian Government (2012) National Competition Policy. Available at: (Accessed: 23 November 2013).
Australian Government Department of Innovation Industry, Science and Research (2011) Focusing Australian Public Funded Research Review. Sydney: Allen and Unwin.
Australian Institute of Health and Welfare (2012). Australia’s Health. Sydney: Stationery Office.
Australian Trade Commission (2012) Australia 's Banking Industry. Australia: Australian Government.
Department of Health and Aging, Residential Care (2011) Health and Aging in Australian. Available at: (Accessed: 21 November 2013).
Edquist, C. (1997) Systems of Innovation: Technologies, Institutions, and Organizations. Oxford: Oxford University Press.
Healy, J
Healy, J., Sharman, E. and Lokuge, B. (2006). ‘Australia: Health System Review.’ Health Systems in Australia, 8(5):1-158.
Henderson, R., Jaffe, A
Mueller, P. (ed.) (2006) Exploring the knowledge filter: How entrepreneurship and university-industry relationships drive economic growth. Hove: Taylor and Francis.
Organization for Economic Co-operation and Development (2012) National Innovation System. Available at: (Accessed: 22 November 2013).
Scott, D. (2012) Responding to change and pursuing growth: Exploring the potential of business model innovation in Australia. Sydney: Sydney University Press.
Wei H. and Zhao P. (2012) The Industry Sources of Australia’s Productivity Slowdown. 89th edn. New York: Eaton and Mains Council.
World Bank (2011) The Australian government 's performance framework. Available at: (Accessed: 20 November 2013).
World Economic Forum (2012) The Global Competitiveness Report. New York: Columbia University.
Appendix 1 Australian Real Gross Domestic Product Growth
Source: Australian Economic Outlook, 2012.
Appendix 2 Competition among Firms in Australia
Sources: Australian Innovation System Report, 2012.
Appendix 3 Australian Government Spending on Innovation
Source: Department of Innovation, Industry, Science and Research, 2011.
Appendix 4 Australian Government Spending
Source: Department of Innovation, Industry, Science and Research, 2011.
Appendix 5 Barriers to Innovation for all Australian Businesses
Source: Australian Innovation System Report, 2012.
Appendix 6 Business Framework Conditions and Other Incentives to Innovate
Sources: Australian Innovation System Report, 2012.
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