S&T and Innovation Policy for Russia

1. S&T and Innovation Policy for Russia Prof. Leonid Gokhberg National Research University – Higher School of Economics Russian-Dutch University Partnerships: Shaping Innovative Academic and Research Agenda Moscow, November 15–16, 2012

2. Contents • Challenges for STI policy in Russia • Strategy 2020: a new STI policy for Russia • Key STI policy targets: 2013-2020 • Recent STI policy agenda photo photo Higher School of Economics, Moscow 2012

3. Global challenges for S&T and innovation policy: moving to a new agenda • Challenges for science policy • Selectivity • Which fields to support and how much focus to give priorities? • Shift from thematic priorities to socioeconomic objectives • Concentration • Which institutions or research teams to support and how concentrated should funding be? • Sustainability • Are the basic resources of people, money, infrastructure and institutions renewing themselves? • Challenges for innovation policy • Framework conditions • IP framework, human resources, competition, health & safety, consumer regulation • Mobility of • knowledge, people, money, services, business • Governance • Open innovation modelCoordination versus integrationMovingtowards a more horizontal andcross-cuttinginnovationpolicyapproachA needforlessconventionalinnovationpolicy photo photo Source: L. Georghiou 3 Higher School of Economics, Moscow 2012

4. Challenges for STI policy in Russia Constraints Challenges Russia is a developed economy with educated population and high GDP per capita level on global scale Unsustainable model of integration into global economy • Development of global cooperation, decrease of its costs, barriers and risks • Low competitiveness in the global arena • Unfavorable climate for entrepreneurship and innovations • Contre-innovative institutions • Increased speed of knowledge generation, new technologic fields and markets development • Sectoral disbalance (focus on raw materials export, import of equipment, “traditional high-tech“) • Domination of vertical organisation of manufacturing and technologic linkages • Development of network model of interaction at global and national level • Consumption level depends on the income from raw resources and does not depend on labour effectiveness • Enhanced paternalistic approach of public policy, « ignoration » of creative class • Crisis of traditional models of social policy, stimulation of initiative and entrepreneurship Higher School of Economics, Moscow 2012

5. Current STI policy in Russia: an overview Higher School of Economics, Moscow 2012

6. Innovative activity of enterprises

7. Gross domestic expenditure on R&D Percentage of Gross domestic expenditure on R&D financed by government, % Percentage of Gross domestic expenditure on R&D financed by industry, %

8. Strategy 2020: imperatives • Education Institutional Regional Cross-regional polarization by innovation activity “Innovation сleavages” • Business • Science Sectoral Social Cross-sectoral differentiation of technological level and innovation activity Discrimination of certain social groups in terms of access to innovations 8

9. Strategy 2020: key trade-offs & options for innovation policy Model • Project-based support of innovative activities in earmarked priority areas • Stimulating mass innovation across all economysectors • Creatingfavourableenvironment for innovativecompanies and unfavourable one for non-innovativecompanies Priorities/Criteria • Rigid hierarchy-based policy • Redistribution of state functions to regions, development institutions, business associations • Promoting cooperation at all levels • Universal instruments • Differenciated policy instruments for specific economy sectors and types of innovators Markets • Continuous support of high-tech sectors related to the former technology paradigm(aircraft, nuclear power generation, etc.) • Priority support of the new economy(«novel» high-tech, services, «green industries», etc.) • Stimulating innovation in low-techsectors • Supporting non-technological innovations • Socio-economic objectives • Technological and non-technological innovations to increase economic efficiency and to benefit from the Schumpeterian (innovation) rent – “innovation for business” • Social priorities – inclusive innovations • Focus on political arguments in decision-making • Functional priorities (design, engineering, technology transfer, networking, training, etc.) • Thematic priorities Higher School of Economics, Moscow 2012

10. Strategy 2020: proposed policy mix IMPROVED QUALITY OF INNOVATION SUPPLY ENHANCED EFFICIENCY OF INNOVATIVE POLICIES SOCIAL FUNCTIONS OF INNOVATION MASS INNOVATIONS ACROSS ALL SECTORS INNOVATION-BASED DEVELOPMENT OF TRADITIONAL SECTORS AND GENERATION OF NEW ONES Incentives for innovating enterprises Enhancement of efficiency in resource utilization Improving R&D sector efficiency Human capital development Support to creative class Support to small innovative enterprises Increasing efficiency of public R&D funding Priority support to new economy sectors and to entry of innovative goods and services to growing markets Functional priorities: compensation of failures in the innovation cycle Integrating vulnerable population groups into innovative processes (inclusive innovations) Enhancement of innovative focus of public procurement Incentives for business investment in STI Improving public perception of innovation Decentralization of STI policies Regulation of technology imports Need for a long-term vision Higher School of Economics, Moscow 2012

11. Key STI policy targets for 2013-2020 Innovation Share of innovation sales in manufacturing exports: 15%(2011 – 5.5%) Promoting Russia in the World Bank Doing Business Index: 20th (2011 – 120th) Share of innovation sales in manufacturing exports: 12%(2011 – 5.5%) Total investment increase by 25% over the 2011 level Share of high-tech and knowledge intensive sectors in exports: 130% of 2011 level Share of innovative enterprises in manufacturing: 60%(2011 – 11%) Total investment increase by 27% over the 2011 level Promoting Russia in the World Bank Doing Business Index: 50th (2011 – 120th) Share of innovative enterprises in manufacturing: 15%(2011 – 11%) Creation and modernisation of 25 mln jobs with high labor productivity Labor productivity increase by 150% over the 2011 level 2012 2014 2016 2018 2020 2011 2013 2015 2017 2019 Share of non-budget expenditure in GERD: 57%(2011 – 32.9%) GERD-to-GDP-ratio: 3% (2011 – 1.12%) GERD-to-GDP-ratio: 1.77%(2011 – 1.12%) Budget of science funds: 25 blnroubles(2011 – 11blnroubles) Share of universities in GERD: 11.4%(2011 – 8.4%) Patent applications per 10,000 population: 2.8(2011 – 1.85) Salaries of researchers (200%of regional averages) Share of Russian publications in the Web of Science journals: 2.44%(2011 – 2.06%) Russian universities in the Top-100 world leading universities: >5(2011 – n/a) Share of universities in GERD: 15% (2011 – 8.4%) Share of Russian publications in Web of Science journals: 3% (2011 – 2.06%) S&T Higher School of Economics, Moscow 2012 President’s Decrees, May 2012 Innovation Strategy, December 2011

12. Recent STI policy agenda: an itinerary action plan • RF Basic Research Programme • State Programme for S&T–2020 • Reform of the HE sector • Federal universities • National research universities • Closures & mergers • Cooperation with companies • Mapping national S&T/research evaluation transformation of the government R&D sector: focus on centres of excellence • Priority development of globally competitive basic & applied research • Mega-science (e.g. co-financing of 6 large research installations) • Integration of Russian leading universities into global networks (e.g. Programme 5/100) • International academic mobility: inward (leading international scientists) & outward (government-supported traineeships) Higher School of Economics, Moscow 2012

13. lgokhberg@hse.ru Thank you!