The linkage between tradition and innovation involves specificities and different degrees of complexity depending on the entrepreneurial activity and economic sector. The paper presents an institutionalist approach on the relation between tradition and innovation through the discussion of a case study related with cork production and transformation in a Portuguese territory: Coruche. We are dealing with an apparent paradox: institutions involve tradition and stability but they also favour change and innovation. It is precisely their stable and routinized nature that creates the conditions to change and innovation: “We look backward because we look forward” (Reisman, 2012: 11; 18). Past experiences create knowledge, competencies and routines, which are societally specific (McKelvey, 1982) and can be used when individuals or organizations face specific problems or have to make choices (Magnusson and Ottosson, 2009). The linkage between past and present, routine and change is related to the simultaneously constraint and enabling nature of institutions. However, the interplay and dynamics between what seems to be opposite aspects of institutions (stability and change; restriction and facility) should be assessed in particular cases considering that the development of entrepreneurial activity work within different and specific institutional frameworks. The results remit to specific dynamics and tensions between tradition and innovation cork industry. These outcomes present important challenges to the maintenance and competitiveness of a central sector of Portuguese entrepreneurship and economy. Keywords: innovation, tradition, cork, institutions.

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Innovation networks,Rural territories,Governance,Institutions,Innovation,Coruche

• Electrical Engineering, Electronic Engineering, Information Engineering - Engineering and Technology
• Mechanical Engineering - Engineering and Technology