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Kiev February 29, 2008

World Bank program on : Technology development and knowledge economy Towards a Knowledge economy : The role of Governments Gilbert Nicolaon. Kiev February 29, 2008. Knowledge (Research) and Economy. Research and Economy. Early 20th century : Research is an « academic » discipline

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Kiev February 29, 2008

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  1. World Bank program on :Technology development and knowledge economyTowards a Knowledge economy :The role of GovernmentsGilbert Nicolaon Kiev February 29, 2008

  2. Knowledge (Research) and Economy

  3. Research and Economy • Early 20th century : Research is an « academic » discipline • World War II : Successful application of R&D (Radar, Atomic Energy, Artificial clouds…) • Post World War II : R&D « with no string attached »

  4. Research and Economy • 50s - 60s R&D « with no strings attached » • 70’s : A major change in the U.S. : A closer link between R and economy • 80’s : Western Europe follows the same path • 90’s : Emerging economies +Eastern Europe • 00’s : Spreading all over the world

  5. A “Universal” challenge • A gap between Research and Economy • A need to fill this gap to • Take advantage of public E&D effort • Improve the competitiveness of national industry • Improve economical growth and employment • A challenge all over the world A MAJOR CHALLENGE FOR MOST COUNTRIES

  6. The «Actors»

  7. The « Actors » Who is concerned ? • Scientists and engineers • Industrialists + • Government A 3 PARTNERS COOPERATION

  8. A «Universal» challenge To bridge the « gap » between public Research and Economy in order to : • Take advantage of « national » R&D effort • Support national economy • Improve national competitiveness • Improve employment • Boost economical growth • Export technological expertise • Improve the balance of payments A CHALLENGE FOR ANY GOVERNMENT

  9. A 3 Partners cooperation What do they expect? • The Technology Providers : To get support for R&D • The industrial Cos (Large + SMEs) : To get new products and processes • The Governments (Ministries, agencies ..): To stimulate economic growth and employment BENEFICIAL FOR EACH PARTNER

  10. A 3-Partner Cooperation What do they do? • The Technology Providers : • Provide innovative technologies • The industrial Cos (Large + SMEs): • Identify the market • Manage the innovative process • The Governments (Ministries, agencies ..) • Establish a favorable legal environment • Stimulate the process to boost the economy • Provide assistance for project management

  11. The Role of Governments

  12. Governments’ « involvement » • A • An appropriate legal framework • Some infrastructure • Assistance for assessment and mgt. • Partial funding + • Incentives to stimulate the process

  13. Governments’ « involvement » 2 major challenges : • Researchers are not used to work for industry • Industry is not used to pay for public R&D GOVERNMENTS HAVE TO SET UP INCENTIVES

  14. Governments’ « involvement » • A major goal for any Government But some major challenges • A need for strong incentives • Legal incentives • Infrastructural incentives (Tech. Parks, Incubators,…) • Financial incentives

  15. Governments’ « involvement » • Incentives for researchers • Infrastructural (Incubators, Tech. Parks,…) • Financial (Royalties sharing….) • Legal • Incentives for industry • Financial (Cost sharing….) • Fiscal (Tax Credit…..) • Legal STRONG INCENTIVES ARE NEEDED

  16. Governments’ « involvement » To create a motivating legal framework : • To encourage market oriented R&D • To stimulate Research/industry partnerships • To allow researchers to patent R&D results • To allow researchers to create start-ups • To boost technological services to industry • To bring assistance to entrepreneurs

  17. Governments’ « involvement » Financial incentives • To support market oriented R&D • Specific grants (To support Mk. Oriented R&D) • Soft loans (0% interest, repayable in case of success) • Tax credit (To stimulate industrial R&D) • To stimulate Research/industry cooperation • To stimulate researchers motivation • Grants or loans for industrial cooperation • Personal financial rewards

  18. Governments’ « involvement » National innovation agencies • Technical expertise AND ALSO • Financial expertise • Economical expertise • Legal expertise

  19. Some elements of an efficient innovation policy

  20. An efficient innovation policy • Strong incentives are needed • Researchers have to be motivated • Industrialists have to be motivated • Financial + legal incentives • Financial support for Research/industry partnerships • Individual financial rewards for researchers STRONG INCENTIVES ARE NEEDED

  21. An efficient innovation policy A legal framework stable over a long period of time is very important • Innovation takes time • Incentives should be stable over long period of time • Legal (Tax) system should be stable THE RULES SHOULD NOT CHANGE WHILE THE INNOVATIVE PROJECT IS GOING ON

  22. An efficient innovation policy The decision process should be fast • Competition • Market change • Technological progress THE DECISION PROCESS MUST BE FAST

  23. An efficient innovation policy An innovation policy should have several components In order to be efficient, it should be : • Coherent • « Light »

  24. A few Programs • United States : SBA • Europe : • Finland : TEKES • France : Oséo-Innovation • The Netherlands : Senter • Spain : CDTI • ….. + Numerous Regional programs • Flanders (Be), Ile de France (Fr.)…..

  25. International Programs • World Bank Projects on Tech Development • Far East (India, Korea…) • Latin America (Mexico…) • Eastern and Central Europe (Croatia…) • European Union Framework Program • Other European programs • Eureka initiative • Intergovernmental (Market-Oriented, Nationally-Funded) • European Space Agency • Technology Transfer program

  26. E.U. programs • Research for the benefit of SMEs • Coordination of SMEs RTD co-operation • ERA-NET • Eurostar • SMEs participation to RTD projects + • Various supporting actions • Network of National Contact Points • Coordination and support actions

  27. Governmental programs • To strengthen national competitiveness Assistance for: • Identifying partners • Preparing a Business Plan • IPR and legal matters • To provide some public funding • Financial support for project preparation • Grants • Soft loans

  28. Research and Innovation

  29. Research and Innovation • RESEARCH : MONEY KNOWLEDGE • INNOVATION : KNOWLEDGE MONEY

  30. Innovation • A « good » technology BUT ….It is far to be enough ! In order to reach the market : • A clear vision of R&D to Mkt. • A fair analysis of the competition • A rigorous Business Plan • A « good » management team

  31. Innovation The 5 components of innovation : • Technical • Economical (market, competition) • Financial (Business plan) • Legal (Partnership agreement, IPR) • Managerial

  32. An innovation policy Competences (*) in 5 different wide sectors Large teams of specialists of each sector + Customer targeting close to the « market » Numerous teams all over the country A CONTRADICTION ?

  33. The « solution » A large headquarter • Technical + Economical • Financial • Legal Several small regional offices • For « customer » targeting

  34. Project evaluation • Technical (quality of the technology) • Economical (market and competition) • Financial (Business plan) • Legal (partnership agreement, IPR) • Managerial (management team)

  35. Project Appraisal The ANVAR (French) experience • A Technico-economical expert Usually an external scientist or engineer who has a good understanding of the market • A Financial expert Usually a banker who has a good experience of the industrial sector concerned • A Legal expert Usually from the Legal Dept. CONCLUSION • An “overall” appreciation By an « Innovation Engineer »

  36. A « good » project ? The limiting factors(The French experience) : • Usually NOT Technical • Financial (Underestimation of project cost) • Economical (overestimation of the market) • Legal (disagreement between partners)

  37. A « good » project ? • A good technology • A rigorous business plan • A carefully analyzed market • A strong legal agreement • A top level management MOST OF ALL A GOOD BALANCE BETWEEN ALL THOSE FACTORS

  38. Thank you for your attention Gilbert Nicolaon Win.tech@club-internet.fr

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