Addressing the Innovation Imperative <ul><li>Science and Technology Landscape in a Changing World </li></ul><ul><li>Enhanc...
Global Challenges for the 21 st  Century <ul><li>Fostering Economic Growth through Innovation  </li></ul><ul><ul><li>Drivi...
Leading Countries and Regions are Responding to the Innovation Challenge <ul><li>They are providing five things: </li></ul...
China’s Goal: To Become an “Innovation-Driven Economy” by 2020 <ul><li>Boosting R&D Investments </li></ul><ul><ul><li>Expe...
R&D Expenditures: Asia’s Surge ©  Sujai Shivakumar , Ph.D.  The rapidly growing R&D expenditures of the Asia-8 economies (...
The Rise of Global Innovation poses new Challenges Europe and the United States  © Sujai Shivakumar, Ph.D.
New Challenges for the US and EU <ul><li>New Competitors in New Markets </li></ul><ul><ul><li>Emerging powers like China a...
What is the Global Impact of China’s Innovation Strategy? <ul><li>Competitive pressures are providing consumers with lower...
How is Europe Addressing the Innovation Imperative?
EU Innovation Funding Mechanisms:  Some of the Most Innovative in the World <ul><li>7 th  Framework Program (€ 50 Billion)...
The European Paradox Large international share of scientific publications Low number of patents and share in high tech pro...
Resolving the Paradox:  Europe’s Best Innovators are Changing <ul><li>Finland, Sweden, the Netherlands, Germany & France a...
How is the United States Addressing the Innovation Imperative?  Strengths and Challenges
National Shares of Global R&D  ©  Sujai Shivakumar,  PhD.  Source: OECD, Main Science and Technology Indicators, 2008. U.S...
Federal R&D investment as a percentage of GDP has been declining ©  Sujai Shivakumar,  PhD.
The Major Risks to the U.S. <ul><li>Complacency about our competitive position in the world </li></ul><ul><li>Limited atte...
What must we  need to do to Remain Competitive in the 21 st  Century? Preserve our Advantages Reinforce our Strengths Enco...
Major U.S. Advantages in Innovation <ul><li>Openness to science and innovation </li></ul><ul><ul><li>Trust in Science & Sc...
Reinforce our Strengths <ul><li>Boost R&D investment:  </li></ul><ul><ul><li>The U.S. must fund R&D at the higher levels a...
Building Innovation Clusters <ul><li>State and Local Initiative:  Traditionally, state and local governments have sought t...
New Federal Initiatives for Clusters <ul><li>Energy Regional Innovation Clusters </li></ul><ul><ul><li>DOE initiative to d...
Conclusion U.S. –E.U. Cooperation can help us both Address this Innovation Imperative © Sujai Shivakumar, PhD
The U.S. Remains an Outstanding Partner for STI Cooperation <ul><li>Our open innovation ecosystem allows you to: </li></ul...
Our Common Challenge <ul><li>The Challenge for Europe and the United States is to Adjust to the new Globalization Dynamic ...
Thank You <ul><li>Sujai Shivakumar, Ph.D. </li></ul><ul><ul><li>Board on Science, Technology, and Economic Policy </li></u...
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Shivakumar 12 12-11

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Shivakumar 12 12-11

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

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