Diagnosing systemic failures in national innovation systems: a coupled functional–structural analysis of Iran’s NIS

Iran’s National Innovation System (NIS), like those of many developing economies, faces intertwined structural and functional deficiencies that constrain its innovation capacity. Recognizing the interdependence of these dimensions, this study employs a coupled functional–structural analytical framework to diagnose systemic failures within Iran’s NIS. Based on document analysis and qualitative content analysis of ten expert focus groups (n = 89), the study identifies 223 failures across twelve functional domains. The findings indicate that weaknesses in institutional frameworks represent the most critical structural deficiencies, while institution-building and policymaking emerge as the primary functional failures. Notably, the study reveals that institutional learning functions as a cross-cutting meta-level mechanism that shapes and reinforces both the structural and functional dimensions of the innovation system. Overall, this research applies a comprehensive diagnostic model and offers actionable, policy-oriented insights for developing countries seeking to enhance innovation capacity in the face of systemic failures.