A dynamic analytic approach to national innovation systems: The IC industry in Taiwan

The paper attempts to develop a mathematical model of the national innovation system (NIS) of Taiwan, particularly with regard to its integrated circuit (IC) industry. The method utilised is that of system dynamics (SD). Drawing on both questionnaire/in-depth interviews and computer simulation, the paper aims to increase insights into the dynamic processes of the Taiwanese IC industry system of innovation and understand the interdependence and interaction among capital flows, human resource flows, knowledge and technology flows, and product flows in the NIS. The paper concludes with some simulations of policy alternatives confronting the IC industry and the Taiwanese government.