Policy Profiles (OECD STI Outlook 2016)

Recent trends in STI and policies

Governments across the OECD and beyond are facing unprecedented economic and societal challenges and they consider science and innovation as part of the response. However recent global growth performance has been disappointing. Weak market prospects dampen investment in innovation investment. There are signs that investment in knowledge-based capital (KBC), including R&D, is levelling off in many countries, even though this had been comparatively dynamic during and since the crisis. In addition countries have been following diverging paths in building their innovation capacity and cross-country differences in investment have been growing, even within Europe.

There is a growing focus of policies on improving the ability of firms to invest in R&D and innovate to escape the low-growth trap, as well as on improving efficiency of the STI policy mix.  Governments have been particularly active in four STI policy areas during 2014-16:

1.            Financing business innovation and entrepreneurship and increasing support to SMEs and their internationalisation;

2.            Rationalising public research spending, closing ties between public and private research and encouraging interdisciplinary research and open science.

3.            Ensuring the future supply of talent and building a culture for innovation, and

4.            Improving STI policy governance, with strong attention given to policy evaluation and the design of responsible research and innovation policies (RRI).

New data from the EC/OECD International Survey on STI Policies (STIP) show that governments have particularly focused attention and action in recent years on strengthening economic growth and making policies more effective, impactful and responsible.

The STI Outlook policy profiles 2016 present recent trends in a broad range of national science and innovation policy domains and policy instruments across OECD member countries and major emerging economies (including Brazil, China, India, Indonesia, the Russian Federation and South Africa). The policy profiles build on country’s responses to the latest STIP Survey and recent OECD work on national science and innovation policies.

For an overview, see Chapter 4 of the STI Outlook 2016 at http://dx.doi.org/10.1787/25186167.

Governance of innovation policies

Fiscal constraints and competing policy priorities weigh on governments’ capacity to maintain their financial commitment. Government investment in R&D was boosted as part of the recovery packages during and after the 2009 crisis. But in view of prospective budgetary constraints, public research and development (R&D) budgets have started to level off or even decline in many OECD countries and there trends are likely to continue in the coming years.

Globally, STI policy has slightly changed focus, form and target in recent years. A growing share of public spending for R&D has been allocated to the business sector, instead of for the public research, signalling a shift in strategic objectives (to increasing industry capacity to innovate) and targets (firms) and requiring a change in instruments.

Recent trends in policy evaluation include the more intensive use of administrative data and online technology for collecting data (“big data”), smaller and more rapid evaluation exercises and a growing complexity in the concepts and practices employed.  In response to the rising risks of misallocation of public resources or negative interactions between instruments, systemic evaluations have spread globally. Overall, general efforts have been directed towards building a more evidence-based knowledge base, through the systematisation of evaluation, a whole-of-government approach to evaluation, more harmonised practices and new data infrastructures and expert communities.

While much STI policy attention is currently focused on the economic slowdown, the ethical and societal dimensions of research have come to the fore and are increasingly reflected in the framing of more “responsible research and innovation” (RRI) policies. Governments have paid attention to fostering a comprehensive approach to governance by enhancing coordination arrangements across the board and involving industry and society upstream in the policy debate. RRI principles have been integrated into the formulation of innovation policy agendas, mainstreamed in existing funding programmes or have targeted the agencies and institutions in charge of policy delivery (e.g. funding agencies).

For an overview, see Chapter 4 of the STI Outlook 2016 at http://dx.doi.org/10.1787/25186167.

Access the Policy Profiles on the Governance of Innovation Policies.

Access the EC/OECD STI Policy Database.

Globalisation of innovation policies

To accelerate growth, governments have sought to restore competitiveness. Raising the innovative capacity of domestic industry is at the core of national STI plans in many OECD countries and emerging economies.

Many countries have refurbished their policy portfolio to assist SMEs and start-ups in accessing global markets. And the internationalisation of clusters, another key channel for SMEs to connect to global knowledge networks, has received particular policy attention.

For an overview, see Chapter 4 of the STI Outlook 2016 at http://dx.doi.org/10.1787/25186167.

Access the Policy Profiles on the Globalisation of Innovation Policies

Access the EC/OECD STI Policy Database.

New challenges

Many countries have readjusted their strategic priority research areas with a view to tackling societal challenges. In addition, in order to weaken cross-disciplinary barriers, some countries have reformed the governance of public research and restructured research agencies.

Efforts towards open science have focused on creating enabling legal frameworks and providing policy guidance for open access and open data. The number of countries with mandatory open access provisions is increasing.

For an overview, see Chapter 4 of the STI Outlook 2016 at http://dx.doi.org/10.1787/25186167.

Access the Policy Profiles on the New Challenges.

Access the EC/OECD STI Policy Database.

Innovation in firms

Business expenditure on R&D experienced a sharp reduction during the crisis, but they have recovered quite strongly since then, with the exception of small and medium sized firms which are still confronted with difficult financial conditions in most countries. Entrepreneurship activities have also been severely hit as bank credit funding and venture capital markets shrunk. Venture capital investments have recovered in only few countries since then.

Streamlining business innovation policy programmes has become a key issue, aiming to make access to public support easier and encourage its broad diffusion. Many countries have consolidated and merged existing support schemes while the total volume of public support was maintained or even increased.

Governments have implemented a “no spending” approach, by privileging policy tools that do not require additional public spending in the short term, particularly public procurement and tax incentives for R&D and innovation. Initiatives to spur business innovation through public procurement have multiplied, making this STI policy area one of the most active over the period. Further reforms are likely to be implemented as a growing number of countries expect demand-side instruments to become more prominent in the future.

Much policy attention remains focused on the articulation of direct and indirect support to business innovation, i.e. competitive grants and R&D tax incentives. R&D tax schemes have gone through more substantial changes during 2014-16 than in the previous period. As in the past, special features have been introduced to make schemes more generous and better adapted to SMEs and young firms. One more recent trend has been the growing policy intention to make them more aimed at supporting technology transfer.

For an overview, see Chapter 4 of the STI Outlook 2016 at http://dx.doi.org/10.1787/25186167.

Access the Policy Profiles on the Innovation in Firms.

Access the EC/OECD STI Policy Database.

Universities and public research

Some countries are reviewing their funding policy of public research, in order to improve efficiency. While there is a global trend towards more competitive funding and contractual arrangements, a small number of countries, particularly in northern Europe, have reversed the trend and increased block funding.

The sources of public research funding have also changed as a result of greater involvement by industry. Public-private partnerships (PPPs) offer opportunities for sharing risks, resources and orientation. Philanthropic and private science foundations, although still small, are playing an increasingly important role in complementing public funding as well.

For an overview, see Chapter 4 of the STI Outlook 2016 at http://dx.doi.org/10.1787/25186167.

Access the Policy Profiles on the Universities and Public Research.

Access the EC/OECD STI Policy Database.

Skills for innovation

Education policy has evolved to reflect the wider range of skills required to innovate. This includes increased budgets to boost science, technology, engineering and mathematics (STEM) education, initiatives to make STEM more attractive to young people, or revised curricula to develop generic skills, problem-solving capacity and entrepreneurial behaviour.

Many countries have sought to build “cultures” of science and innovation that will help reinforce public participation in and support for science and entrepreneurship. For instance, there have been efforts to build capacity for the popularisation of science, and to foster an entrepreneurial spirit and increase creativity in the work place.

For an overview, see Chapter 4 of the STI Outlook 2016 at http://dx.doi.org/10.1787/25186167.

Access the Policy Profiles on the Skills for Innovation.

Access the EC/OECD STI Policy Database.

Access the policy profiles

To access the policy profiles, you may use the menu on the right-hand side of this page. Policy profiles are classified by major STI policy theme following the chapters of the OECD STI Outlook 2016 publication.

The STI Outlook 2016 is a collective effort and takes a horizontal approach, co-ordinated by the Science and Technology Policy (STP) Division of the OECD Directorate for Science, Technology and Innovation (DSTI). It is produced under the guidance of Dominique Guellec. Sandrine Kergroach served as the overall co-ordinator and Sylvain Fraccola as the administrative co-ordinator.
Policy profiles and their analytical framework were designed by Sandrine Kergroach, who ensured co-ordination and consistency.
All components of the STI Outlook 2016 have been reviewed by and received valuable comments from the editorial board: Dominique Guellec, Dirk Pilat and AndrewWyckoff of the DSTI.
Sandrine Kergroach supervised the development of the policy infrastructure (EC/OECD STIP database) and the statistical infrastructure (IPP.Stat). Sylvain Fraccola, Chiara Petroli, Jakob Pruess and Charlotte van Ooijen provided research assistance in processing the 2016 country responses. Thanks to colleagues of the European Commission’s DG RTD for their help in preparing country information for the 2016 survey. Sylvain Fraccola and Blandine Serve provided co-ordination and statistical assistance respectively and supported the entire survey process.
Thanks to Blandine Serve for her statistical support for the overall publication. Thanks to Silvia Appelt, Frédéric Bourassa, Hélène Dernis, Isabelle Desnoyers-James, Fernando Galindo-Rueda, Elif Koksal-Oudot, Guillaume Kpodar, Christina Serra-Vallejo, Brigitte Van Beuzekom and Fabien Verger for statistical inputs. Thanks to Samuel Pinto-Ribeiro for IT support. Thanks to Florence Hourtouat, Beatrice Jeffries, Laura Victoria Garcia and Sophie O’Gorman for secretarial assistance.