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Shivakumar 12 12-11

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  • 1. Addressing the Innovation Imperative
    • Science and Technology Landscape in a Changing World
    • Enhancing US Collaboration with the EU and Member States
    • December 12, 2011
    • Washington DC
    • Sujai Shivakumar, Ph.D.
    • Board on Science, Technology, and Economic Policy
    • The National Academies
    © Sujai Shivakumar, Ph.D.
  • 2. Global Challenges for the 21 st Century
    • Fostering Economic Growth through Innovation
      • Driving domestic Growth and Employment
    • Developing New Sources of Energy
      • Commercializing renewable alternatives to oil
      • Increasing the capacity to fuel growing global demand for electricity
    • Addressing Climate Change
      • Growing a Green Economy; A major Growth opportunity
    • Delivering Global Health
      • Transforming large investments in research to affordable and personalized treatment and care
    • Improving Security
      • Through all of the above
    • Addressing these Global Challenges requires Innovation
    © Sujai Shivakumar, Ph.D.
  • 3. Leading Countries and Regions are Responding to the Innovation Challenge
    • They are providing five things:
      • High-level Focus on Growth and Strength
      • Sustained Support for Universities
      • Rapidly Growing Funding for Research
      • Support for Innovative Small Businesses
      • Government-Industry Partnerships to bring new products and services to market
    • They are investing very substantial resources to create, attract and retain the industries of today and tomorrow.
    © Sujai Shivakumar PhD.
  • 4. China’s Goal: To Become an “Innovation-Driven Economy” by 2020
    • Boosting R&D Investments
      • Expenditure on basic research doubled between 2004 and 2008
      • Tax incentives for enterprises that invest in R&D
    • Building R&D Infrastructure and Facilities
    • Focus on building world class universities to create a Skilled Workforce
    • “ Indigenous Innovation” supported by Government Procurement and Financial Support
      • Financing for large projects
      • Facilitating Credit and investment capital for SMEs
      • Source: Mu Rongpin, 2010 UNESCO Science Report
    © Sujai Shivakumar, PhD.
  • 5. R&D Expenditures: Asia’s Surge © Sujai Shivakumar , Ph.D. The rapidly growing R&D expenditures of the Asia-8 economies (China, India, Japan, Malaysia, Singapore, South Korea, Taiwan, Thailand) surpassed those of the EU-27 in 2003. Source: NSF 2010 S&E Indicators U.S. Asia E.U.
  • 6. The Rise of Global Innovation poses new Challenges Europe and the United States © Sujai Shivakumar, Ph.D.
  • 7. New Challenges for the US and EU
    • New Competitors in New Markets
      • Emerging powers like China and India have critical masses of highly educated scientists and engineers, rising R&D spending, and large, rapidly growing domestic markets for high-tech products.
    • New Patters of Collaboration
      • Information technologies make knowledge, money, and people flow across borders with ever-greater speed and ease
      • Growth in open collaborative innovation networks linking corporations, researchers, investors and institutions around the world
    • New Innovation Hubs
      • Innovation hubs like Silicon Valley and greater Boston, face greater competition from dynamic new commercialization zones, such as Taipei, Shanghai, Tel Aviv, and Bangalore.
    © Sujai Shivakumar, Ph.D.
  • 8. What is the Global Impact of China’s Innovation Strategy?
    • Competitive pressures are providing consumers with lower priced manufactured goods, but…
      • Imposing high environmental costs
      • Displacing workers and companies around the world
    • Large scale free-riding on the global innovation system is not sustainable for China or for the US and EU
      • China is leveraging its large domestic market to get foreign firms to transfer their technology—short term approach
      • Weak IP allows copying of foreign technology—but cripples innovation in China
      • Source: Carl Dahlman, “The World Under Pressure,” 2011
    © Sujai Shivakumar, Ph.D.
  • 9. How is Europe Addressing the Innovation Imperative?
  • 10. EU Innovation Funding Mechanisms: Some of the Most Innovative in the World
    • 7 th Framework Program (€ 50 Billion)
      • Support to private companies, universities, public authorities, and researchers in developing countries
    • Competitiveness and Innovation Program (€3.6 Billion)
      • Seeks to provide SMEs better access to finance and business support services in the regions
    • EU Cohesion Policy (€86 Billion)
      • Structural and Cohesion funds spending on innovation, growth, jobs as well as sustainable development goals
    • Lifelong Learning Program (€ 6.2 Billion)
      • Erasmus and Leonardo Programs
      • Source: Delegation of EU to Washington, Jan 2010
  • 11. The European Paradox Large international share of scientific publications Low number of patents and share in high tech products trade © Sujai Shivakumar, PhD
  • 12. Resolving the Paradox: Europe’s Best Innovators are Changing
    • Finland, Sweden, the Netherlands, Germany & France are among those
      • Making Substantial public R&D investments
      • Internationalizing the innovation environment
      • Reforming universities and public research institutes
      • Mobilizing private capital for start-ups and growth companies ( eg. by providing tax incentives)
      • Introducing new partnership programs for greater productivity in the services sector (private & public)
    © Sujai Shivakumar, Ph.D.
  • 13. How is the United States Addressing the Innovation Imperative? Strengths and Challenges
  • 14. National Shares of Global R&D © Sujai Shivakumar, PhD. Source: OECD, Main Science and Technology Indicators, 2008. U.S. Germany France UK Japan Korea China Others Other EU
  • 15. Federal R&D investment as a percentage of GDP has been declining © Sujai Shivakumar, PhD.
  • 16. The Major Risks to the U.S.
    • Complacency about our competitive position in the world
    • Limited attention to the composition of the economy, including trade and investment policy
    • Focus on current consumption rather than investment for the future
      • A lack of investment in R&D on the scale of our fathers and our competitors
    • Failure to focus on the commercialization of research and on manufacturing
    © Sujai Shivakumar, PhD.
  • 17. What must we need to do to Remain Competitive in the 21 st Century? Preserve our Advantages Reinforce our Strengths Encourage Cooperation © Sujai Shivakumar Ph.D.
  • 18. Major U.S. Advantages in Innovation
    • Openness to science and innovation
      • Trust in Science & Scientific Institutions
    • Positive Social Norms
      • High Social Value on Commercial Success
      • Forgiving Social Norms allow more than one try
    • Entrepreneur-friendly Policies
      • Markets Open to Competition
      • Gentle Bankruptcy Laws permit rapid recovery
      • Taxes give Prospect of Substantial Rewards
    • Strong Intellectual Property Protection:
      • Encourages Research & Diffusion of Research
    © Sujai Shivakumar, PhD.
  • 19. Reinforce our Strengths
    • Boost R&D investment:
      • The U.S. must fund R&D at the higher levels authorized under the America COMPETES Act
    • Sustain University Research
    • Build and Reinforce Successful Public Private Partnerships:
      • Renew and Expand programs like SBIR
    • Attract Foreign Talent:
      • Reform immigration laws to attract foreign scientists, engineers, and entrepreneurs
    © Sujai Shivakumar, Ph.D.
  • 20. Building Innovation Clusters
    • State and Local Initiative: Traditionally, state and local governments have sought to stimulate cluster growth
    • Lack of Critical Mass: In many cases, however, state and local efforts lack critical mass
      • Funding; Facilities; Sustained Policy Support
  • 21. New Federal Initiatives for Clusters
    • Energy Regional Innovation Clusters
      • DOE initiative to develop regional clusters in solar power, energy-efficient buildings, nuclear energy, and advanced batteries.
    • Regional Innovation Strategies Initiative
      • Commerce-EDA initiative to map clusters and provide grants to support local cluster programs
    • Nanoelectronics Research Initiative
        • NIST initiative brings together industry, government, and academia to develop next-generation semiconductor technologies
        • Index, a 11-university consortium, is based at the State University of New York-Albany.
  • 22. Conclusion U.S. –E.U. Cooperation can help us both Address this Innovation Imperative © Sujai Shivakumar, PhD
  • 23. The U.S. Remains an Outstanding Partner for STI Cooperation
    • Our open innovation ecosystem allows you to:
      • Connect with a robust and open innovation network
      • Draw on the US R&D and University Systems
      • Access one of the worlds largest and most open markets
      • Attract the attention of some of the largest & most dynamic overseas investors
    © Sujai Shivakumar, Ph.D.
  • 24. Our Common Challenge
    • The Challenge for Europe and the United States is to Adjust to the new Globalization Dynamic
    • This involves initiating change through competitive incentives:
      • Incentives for entrepreneurial activity for Small Firms, Large Firms, and Universities
      • Incentives (not mandates) for cooperation among all actors
    • Cooperation and Mutual Learning is the best way forward
    © Sujai Shivakumar, PhD
  • 25. Thank You
    • Sujai Shivakumar, Ph.D.
      • Board on Science, Technology, and Economic Policy
      • The National Academies
      • 500 Fifth Street NW
      • Washington, D.C. 20001
      • [email_address]
      • Tel: 202 334 1337
      • http://www.nationalacademies.org/step