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An Overview of Public Policies to Support Innovation


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  • Florence Jaumotte
  • Nigel Pain


Innovation is a broad topic, about which much has been written. Almost every kind of public policy has either a direct or an indirect impact on factors that affect innovative activity. The purpose of this paper is to draw out the key implications from selected studies concerning a small number of science-related policies that are widely employed in order to deal with perceived market failures in the innovation process. The main issues considered are fiscal incentives for private R&D, the role of public research organisations, the regulation of intellectual property, the availability of finance, and the supply of skilled human resources for science and technology. Two central themes developed in the paper are the need for accurate evaluation of all these policies, since each may have costs as well as benefits, and the likely enhancement of the wider social benefits from innovation if knowledge is able to diffuse freely, and if potential beneficiaries have sufficient absorptive capacity to be able to understand and use new knowledge productively. Revue des politiques publiques en faveur de l'innovation L’innovation est un sujet vaste qui a fait l’objet d’une littérature abondante. Presque tout instrument de politique économique a un impact, soit direct, soit indirect, sur les déterminants de l’activité d’innovation. L’objectif de ce papier est de faire le point, à partir d’une sélection d’études, sur un petit nombre de politiques d’innovation couramment utilisées pour remédier aux imperfections de marché dans le processus d’innovation. Celles-ci incluent les incitations publiques aux activités privées de recherche et développement (R&D), le rôle des instituts publics de recherche, les droits de propriété intellectuelle, le développement du secteur financier, et la disponibilité de ressources humaines qualifiées en science et technologie. Deux thèmes centraux développés dans le papier sont d’une part le besoin d’une évaluation précise de toutes ces politiques, étant donné que chacune d’entre elles présente à la fois des coûts et des bénéfices, et d’autre part l’importance de la diffusion du savoir qui accroît substantiellement les bénéfices sociaux de l’innovation, à condition que les bénéficiaires potentiels jouissent d’une capacité d’absorption suffisante pour comprendre et appliquer productivement le nouveau savoir.

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Bibliographic Info

Paper provided by OECD Publishing in its series OECD Economics Department Working Papers with number 456.

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Date of creation: 01 Dec 2005
Date of revision:
Handle: RePEc:oec:ecoaaa:456-en

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Keywords: intellectual property rights; public research organisations; scientists and engineers; innovation; fiscal incentives; incitations publiques; innovation; scientifiques et ingénieurs; instituts publics de recherche; droit de propriété intellectuelle;

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Cited by:
  1. Graziano Pini, 2010. "Governance of Tech Transfer: Recent Experiences in Some Developed Regions of Europe," Transition Studies Review, Springer, Springer, vol. 16(4), pages 872-883, February.
  2. Simachev, Yuri & Kuzyk, Mikhail & Feygina, Vera, 2014. "Russian policies in support of innovation: elusive quest for efficiency," MPRA Paper 56750, University Library of Munich, Germany.
  3. Desiderio Romero Jordán & José Félix Sanz Sanz, 2007. "Eficacia de los incentivos fiscales a la inversión en I+D en España en los años noventa," Hacienda Pública Española, IEF, IEF, vol. 183(4), pages 9-32, december.
  4. Mark Dodgson & Alan Hughes & John Foster & J.S. Metcalfe, 2010. "Systems thinking, market failure, and the development of innovation policy- The case of Australia," Discussion Papers Series 403, School of Economics, University of Queensland, Australia.
  5. World Bank, 2006. "Pakistan : An Assessment of the Medium-Term Development Framework," World Bank Other Operational Studies 19450, The World Bank.
  6. Singh, Lakhwinder, 2006. "Innovations and Economic Growth in a Fast Changing Global Economy: Comparative Experience of Asian Countries," MPRA Paper 80, University Library of Munich, Germany.
  7. Ljungwall, Christer & Gustavsson Tingvall, Patrik, 2014. "No. 233 Is China Different? A Meta-Analysis of the Growth-enhancing Effect from R&D Spending in China," Ratio Working Papers, The Ratio Institute 233, The Ratio Institute.
  8. Singh, Lakhwinder & Singh, Baldev, 2009. "National Innovation System in the Era of Liberalization: Implications for Science and Technology Policy for Developing Economies," MPRA Paper 15432, University Library of Munich, Germany.
  9. Pierre-André Buigues & Khalid Sekkat, 2011. "Public Subsidies to Business: An International Comparison," Journal of Industry, Competition and Trade, Springer, Springer, vol. 11(1), pages 1-24, March.


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  1. Socio-Economics of Innovation


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