The traditional concept of innovation focuses on significant changes in products and services. However, today’s innovation derived from the digital economy environment is transforming our way of life, values, and even social relations. The economic benefits of the digital economy and technology have a wide range of impacts derived from the rapid socio-economic transformation. The negative impact on jobs and incomes is a typical problem that threatens socioeconomic fundamentals. This phenomenon is the reason that we must have a new perspective about innovation that connects technology, economy, society and policy beyond the traditional perspective. Based on the new perspective, this study categorizes social innovations using an expanded concept. One of them is “adaptive social innovation”, and this study focuses on its key motive and impact. In this paper, a theoretical discussion is adopted from integrating discussions in macroeconomics, social psychology, political science, etc. The key motive can be found in transformation of production, consumption, and distribution due to the digital economy. Based on this, the detailed operation mechanism of adaptive social innovation that transforms public perceptions and systems are analysed. At the same time, the process in which formal institutions and the output of adaptive social innovation, affect society and policy was explored.

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