Innovation in the Business Sector

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Innovation in the Business Sector

Author Info

Florence Jaumotte
Nigel Pain

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Nigel Pain

Abstract

This paper draws together the key findings from separate detailed analyses of the determinants of R&D, patenting and the commercial introduction of innovations in the business sector in order to identify the policies, institutions and framework factors that provide the most effective means of supporting innovation. The evidence suggests that there is a clear role for framework conditions, framework policies and specific science policies, both independently and in interaction with each other. Policies that raise the absorptive capacity of the economy (the capacity to understand and make use of new knowledge) are likely to have dual benefits, not only helping to stimulate new innovative activities, but also helping to maximise the benefits to be gained from the existing stock of knowledge. Potential policy trade-offs also need to be taken into account. Some policies that offer benefits for current innovation also have costs that could adversely affect future incentives to innovate. Others have trade-offs when considered in combination. Cross-country differences in the level of R&D intensity are shown to be closely correlated with crosscountry differences in science policies and institutions. Framework conditions and policies have an important influence when accounting for cross-country differences in the rate of change of R&D intensities over time.

L'innovation dans le secteur des entreprises
Ce document fait la synthèse des principales conclusions d’un certain nombre d’analyses détaillées sur les déterminants de la R&D, du brevetage et de l’introduction commerciale des innovations dans le secteur des entreprises, afin de pouvoir mettre en évidence les facteurs politiques, institutionnels et structurels qui offrent les meilleures conditions pour soutenir l’innovation. On constate que les conditions et politiques structurelles comme les politiques spécifiques de la science ont une importance évidente, tant isolément qu’en interaction les unes avec les autres. Les politiques qui visent à agir sur la capacité d’absorption de l’économie (c’est-à-dire à améliorer la capacité de comprendre les nouveaux savoirs et d’en faire usage) ont généralement un impact doublement positif : non seulement elles contribuent à stimuler de nouvelles activités d’innovation, mais elles aident en outre à maximiser le bénéfice que l’on peut tirer du stock de connaissances existantes. Il faut aussi tenir compte des éventuels inconvénients que peuvent avoir ces politiques. Certaines mesures de soutien aux innovations en cours ont aussi des coûts qui risquent de pénaliser les incitations à l’innovation dans l’avenir. D’autres ont des effets pervers si elles sont combinées. On démontre que les écarts d’intensité de R&D d’un pays à l’autre sont étroitement corrélés aux différences observées au niveau des politiques scientifiques et des établissements de recherche. Les conditions cadres et les politiques jouent un rôle non négligeable pour expliquer les différences d’un pays à l’autre dans le rythme d’évolution de l’intensité de R&D au fil du temps.

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Paper provided by OECD, Economics Department in its series OECD Economics Department Working Papers with number 459.

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Date of creation: 02 Dec 2005
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Handle: RePEc:oec:ecoaaa:459-en

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Find related papers by JEL classification:
O30 - Economic Development, Technological Change, and Growth - - Technological Change - - - General
O38 - Economic Development, Technological Change, and Growth - - Technological Change - - - Government Policy

This paper has been announced in the following NEP Reports:

NEP-ALL-2005-12-09 (All new papers)
NEP-INO-2005-12-09 (Innovation)

Cited by:
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Richard Dion & Robert Fay, 2008. "Understanding Productivity: A Review of Recent Technical Research," Discussion Papers 08-3, Bank of Canada. [Downloadable!]

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