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Abstract Innovation within the Australian wine industry is at a crossroads. More specifically, under the influence of fundamental change, the objectives, extension and uptake of research and development (R&D) within the industry's current innovation framework are being subjected to rather schizophrenic forces. At one level, industry organizations are directing the R&D agenda from within a national, ‘Brand Australia’ context. At another level, the firms being serviced by these organizations are demanding region‐specific R&D extension in response to global pressure for differentiation and products at higher price‐points. This paper explores these contradictory forces and the degree to which they signal an emergence of innovation lock‐in within the industry. It also proposes a model for the effective distribution of R&D at a regional or local level. Copyright © 2006 John Wiley & Sons, Ltd.
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