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Increasing the impact of public investments in innovation Three - - PowerPoint PPT Presentation
Increasing the impact of public investments in innovation Three - - PowerPoint PPT Presentation
Increasing the impact of public investments in innovation Three questions What to invest in How much to invest R&D Labour Productivity 60% Intangibles Unicorns 1.12% European Union United States How to invest effectively 14740
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What to invest in
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How much to invest
R&D Intangibles Unicorns Labour Productivity
60% 1.12%
United States European Union
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How to invest effectively
€150 billion
spent every year on innovation, entrepreneurship and business growth support programmes in Europe alone
But slow productivity growth and convergence in Europe
Source:http://www.innovationgrowthlab.org/blog/much-%E2%82%AC152-billion-spent-acro ss-europe-supporting-businesses-does-it-work
Little credible evidence on what works, and what doesn’t
14740 evaluations of support schemes
Credible (2.4%) + Impact (0.6%)
Source: Systematic reviews conducted by the What Works Centre for Local Economic Growth at the LSE (Credible: Level 3 Maryland Scale – Positive impact on employment)
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Becoming more experimental
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Why experiment
More impactful policies & better value-for-money
Novel solutions to policy challenges De-risk new programmes Continuous improvement Time-limited unless demonstrated impact Better evidence & decisions Save money
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More effective messages: the UK’s Business Department used ‘nudging’ trials experimenting with different language to recruit business mentors New research collaborations: Harvard Medical School researchers were randomised to meet as part of a grant programme information session More successful startups by making a small tweak: the Startup Chile accelerator trialled sharing application feedback with its participants Helping businesses grow with a low-cost networking intervention: two academics trialled monthly meetings between business owners in China Researchers were 75% more likely to collaborate Startups raised +50% more funding Increased firm revenue by 8%
Read more about what we’re learning from policy experiments
Additional 800 mentors recruited, policy target met
Trials can have a powerful impact
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right incentives experimentation funds
How to become experimental
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An experimental €1 bn productivity fund
An impactful BICC investment
Leverage BICC to increase the effectiveness and efficiency of member states investment
€1,000 billion
European countries’ expected expenditure in policies to support businesses to innovate and grow in 2021-2027
Invest 0.1% (€1 bn) to find ways to maximise the impact
- f the remaining 99.9%
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Some potential programme areas
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Innovation in how we regulate
SANDBOX
Testbeds
Regulators’ Pioneer Fund
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Give startups the option to
- perate under the same rules
across the EU through a single digital platform, while preserving the rights of member states over specific issues → Help innovative startups to grow faster Piecemeal regulatory reforms constrained by status quo and institutional inertia → This 29th regime would create a new system from scratch designed for the 21st century, not one inherited from the 19th century
Reinventing business regulation
Innovate in regulation and enforcement Less-fragmented internal market Reduce competitiveness differentials The “Eurocompany”: a new full-fledged business regime, sitting alongside national regimes without replacing them (either EU-wide or for a smaller group of countries)
Give entrepreneurs from countries with poor regulatory environments the opportunity to opt-out from inefficient national rules (introducing regulatory competition without a race to the bottom) → Accelerate convergence
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Changing systems
TRANSFORM FUNDING Higher innovation Faster economic growth Better living standards TRANSFORM REGULATION Experimental 1 billion productivity fund More impactful support programmes and funding instruments “Eurocompany” business regime More innovation-friendly and less fragmented regulatory regime
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Conclusion
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Annex: About the Innovation Growth Lab
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What IGL is
A global partnership bringing together governments, foundations and researchers to scope, develop and test different approaches to increase innovation, support high-growth entrepreneurship and accelerate business growth
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IGL – A global community for better policies through experimentation
IGL Partners Other organisations we’ve worked with: IGL Research Network
Over 85 researchers from around the world:
IGL Scientific Committee
Nick Bloom Stanford Graduate School of Business | Dietmar Harhoff Max Planck Institute for Innovation and Competition | Karim Lakhani Harvard Business School | Josh Lerner Harvard Business School | Fiona Murray MIT Sloan | Mark Schankerman LSE | Scott Stern MIT Sloan | John Van Reenen MIT Sloan
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