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The innovation system and IUGP settings of Norway are of special interest because the country has transformed its oil and gas-based growth to knowledge-based development. Norwegian example is most suitable for the small-sized wealthy nations with abundant hydrocarbon resources which are committed to transform their natural capital to knowledge capital. This chapter provides a detailed account on the past and present of innovation system and IUGP initiatives that helped Norway in developing its knowledge ecosystem. We explore the cultural and institutional settings in Norway to find the needs and motivations to transform the Norwegian hydrocarbon economy to knowledge-based economy. The role of the state government has been remarkable in establishing the sector-based public research institutes and a collaborative framework between the research institutes, higher education institutes, and industry. In addition, the enactment of concession laws and the law on the right to inventions made by employees motivated the knowledge-based workforce to innovate and commercialize. At the same time, the establishment of science parks and business parks helped the young entrepreneurs and SMEs to increase their competence level and to compete at the national and international levels. Also, the decentralized public procurement helped in stimulating the domestic market for innovation. Lastly, the public-private partnership programs created further opportunities for technology transfer and commercialization.
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