The Government's policy on supporting innovation ignores huge parts of the UK economy by focusing too heavily on science and technology, according to research by the University of Warwick.
The research, funded by the National Endowment for Science, Technology and the Arts (Nesta), is due to be unveiled in March. It found that "soft innovation" had been overlooked, despite accounting for a large proportion of the innovation taking place in the economy.
"Innovation that encompasses the artistic, formal (as in the contrast between form and function) or aesthetic has largely been ignored in the mainstream literature on innovation," according to the study, led by Paul Stoneman, research professor of marketing and strategic management at Warwick Business School.
Professor Stoneman's study found that, until now, UK policy associated innovation with science and technology and devised policies aimed at supporting these areas. "Policy needs to be rebalanced to include the total of innovative activity and not just part," Professor Stoneman's research concludes.
The study recommends that the Government consider tax incentives for soft innovation.
Professor Stoneman told Times Higher Education: "The message to be delivered to funders is that rather than just being a characteristic of a civilised society, investments in the arts, social sciences and humanities may also be seen to stand alongside science and technology as a source for innovation, growth and competitiveness in the economy."
Hasan Bakhshi, research director of arts and innovation at Nesta, said the higher education sector had a role to play by assessing its own work with industry.
"What is particularly striking is that extent of soft innovation activity in sectors as wide-ranging as music, video, games, pharmaceuticals and the food industry," he said. "Yet soft innovations are, by and large, bypassed by traditional innovation policies ... which focus only on technological product and process innovations."