Martin Fransman gave a good keynote on what causes innovation at today’s ITS conference. One question that arose from his discussion of Apple and a low-tech (low expenditure on R&D) company was how we could objectively measure innovation. Fransman answered by saying R&D expenditures were a bad indicator, being (a) an input measure, and (b) excluding a lot of service innovation expenditures (Apple was high here). No one would be misled into believing that Apple did not innovate. After the session I was chatting about this with Michael Latzer of U Zurich.