Digital technologies are considered as factors that accelerate the pace of innovation and increase the firm’s innovation performance. However, few studies have investigated whether this claim is conditioned by other elements that contribute to innovation. Furthermore, firms increasingly rely on external knowledge sources to expand their internal knowledge base for the development of innovations. In this context, absorptive capacity can be considered as an essential organizational capability to embrace adoption of digital technologies and enhance their positive effect on innovation performance. This paper builds on this discussion and studies the contribution of digital capacity on innovation performance, proposing the mediating role of absorptive capacity in the context of the digital transformation. It uses evidence from an extensive Greek survey in 1014 manufacturing firms and analyzes the complex relationships underlying the role of digital transformation to innovation. The contribution of the paper is two-fold: (i) it provides a deeper insight into the underlying mechanisms through which firms can leverage their digital capacity to accelerate innovation, and (ii) it highlights the important mediating role of absorptive capacity in enhancing the positive effects of digitalization indicating that digital capacity is not an unquestionable asset for innovation performance. Accordingly, our results show a positive direct contribution of digital capacity to innovation performance, which is enhanced in the presence of absorptive capacity as a mediator. In fact, the indirect effect of digital capacity to innovation performance through absorptive capacity is stronger. These findings present important policy implications, as there is need for improvement in other innovation-related aspects of the business ecosystem to efficiently address the challenge of digital transformation, such as R&D efforts, training, interaction among actors, and building of communities of practice.

The increasingly acute consequences of the climate crisis, the COVID-19 pandemic, and the energy crisis have put industrial policy back. The papers in this issue examine how different countries implement industrial policy for sustainable development from a variety of perspectives. A successful transition to sustainable development seems to require not only the mix of carrots and sticks but also a right mix of creation versus destruction, as in the case of the creation of renewable businesses and the destruction of fossil-fuel businesses. Furthermore, because institutional diversity and the risk of capture can result in very distinct economic, social, and environmental effects, consideration of heterogeneity at the country and sector levels and coordination of vested interests are essential ingredients for sustainable industrial policies, as shown by the case of industrial policy in France and the two industry cases in India. By contrast, the Amazon Fund case is indicative of the three success elements: multi-stakeholder governance, pay-for-performance funding, and non-reimbursable project financing. These three elements can be summarized as local ownership and accountable governance, provided with both carrots and sticks. The problematic case of urban development driven by the oil industry in Ghana can be criticized in terms of the lack of local ownership of the oil industry, which has led to all rents being monopolized by the absentee class. By comparison, the mixed success of cases of industrial symbiosis in Uganda is attributed to the lack of effective carrots. In sum, industrial policy for sustainable development requires handling well all three types of failure, namely, market, system, and capability failures, because it necessitates building capabilities of involved actors and coordinating actions of agents, in addition to providing optimal incentives to reflect externalities of global public goods. Overall, the shifting focus of industrial policy is consistent with the shift of the role of the state, from developmental to entrepreneurial, and finally to environmental state.

While entrepreneurship has emerged as an important mechanism for the generation of social returns in terms of economic growth and job creation, entrepreneurship education is still something new in Europe and the debate about the need and the way of introduction of specific entrepreneurship courses in higher education is on going. This paper deals with the introduction of entrepreneurship education in engineering curricula. More specific it presents the experience of the National Technical University in Greece, as a case in point for discussing the need of an interdisciplinary approach in designing engineering curricula. The main argument is that the introduction of entrepreneurship education in University curricula should not result as an application of policy initiatives only related to economic imperatives. It should be part of a more general discussion related to educational priorities and of a strategic design of University curricula in order to provide engineers with entrepreneurial and management skills that will enhance their profile in accordance with the new requirements of the knowledge-based economy.

This paper builds on Qian and Acs (Small Business Economics, 40, 185–197, 2013) concept of entrepreneurial absorptive capacity and empirically investigates its role in the context of new knowledge intensive entrepreneurship. When it comes to the business formation phase and especially to the creation of knowledge intensive entrepreneurial ventures, knowledge inheritance of new firms seems to be more related to individual attributes. The knowledge intensity of these ventures is very much dependent on the founders’ capability to understand new knowledge, combine their knowledge with external knowledge sources, and exploit it in the context of opportunities they can recognise; that is, their absorptive capacity. This study provides new insights into the concept of absorptive capacity by studying it at the individual level enhancing the way of measuring it. Based on quantitative data from a large-scale survey, we conducted a partial least squares structural equation modelling (PLS-SEM) application, which verified the role of entrepreneurial absorptive capacity in triggering knowledge intensive entrepreneurship. Furthermore, the results imply a weaker but positive indirect effect of absorptive capacity to new venture performance. There is also a statistically significant negative influence of competition intensity and a positive influence of equity funding on the formation of knowledge intensive entrepreneurship. At the policy level this analysis reveals the importance of micro-determinants in fostering knowledge intensive entrepreneurial activities.