Measuring Innovation:Nesta’s Innovation Index ProjectAlbert Bravo-BioscaInnobasque, May 14th
“Whatdoesn’t gets measureddoesn’t gets done”
“Whatdoesn’t gets measureddoesn’t gets done”
Innovation is more than high-tech and R&D
Why was Apple themost valuable companyof all time?Buildings MachinesDesignBrandSoftwareBusiness modelIntangible assetsPate...
But intangible assets are difficult to measureAccountants are more conservative  Firms’balance sheets don’t include most ...
Nesta Innovation Index• Multi-year research programme toimprove the measurement ofinnovation in the private and publicsect...
The UK economy∗is 10 per cent larger counting intangiblesSource: Nesta Innovation Index
R&D is only 13 per cent of intangible investmentSource: Nesta Innovation IndexInvestment in intangibles by type, 2009 (£bn)
The UK invests more in intangibles than tangiblesSource: Nesta Innovation Index£ billion (current prices)tangiblesIntangib...
Large cross-country differences on intangible investmentSource: OECDIntangible to tangible investment ratio1,64 1.601,23 1...
Source: OECDIntangible to tangible investment ratio1,64 1.601,23 1,200,89 0,89 0,86 0,840,73 0,710,650,46 0,440,400,300,23...
There are large differences across sectorsSource: Nesta Innovation IndexInvestment in intangibles relative to gross value ...
The relative importance of intangibles also variesSource: Nesta Innovation IndexIntangible-tangible investment ratio by se...
Each sector innovates in a different wayShare of intangible investment by sector and type, 2007Source: Nesta Innovation In...
Innovation support policies are not sector neutralSource: Nesta Innovation IndexShare of intangible investment by type and...
Innovation makes a large contribution to growthSource: Nesta Innovation IndexContribution to productivity growth, % 2000 -...
Albert Bravo Indizea Asamblea Innobasque
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Albert Bravo Indizea Asamblea Innobasque

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Albert Bravo Indizea Asamblea Innobasque

  1. 1. Measuring Innovation:Nesta’s Innovation Index ProjectAlbert Bravo-BioscaInnobasque, May 14th
  2. 2. “Whatdoesn’t gets measureddoesn’t gets done”
  3. 3. “Whatdoesn’t gets measureddoesn’t gets done”
  4. 4. Innovation is more than high-tech and R&D
  5. 5. Why was Apple themost valuable companyof all time?Buildings MachinesDesignBrandSoftwareBusiness modelIntangible assetsPatentsOne thing in common: Intangible assets
  6. 6. But intangible assets are difficult to measureAccountants are more conservative  Firms’balance sheets don’t include most intangibleassets (Apple market value 5x its book value)National accounts ignore most type ofintangibles  Official investment statisticsmostly about buildings and machinesStock market prices capture the value of acompany’s intangibles… (if you still believein efficient markets!)
  7. 7. Nesta Innovation Index• Multi-year research programme toimprove the measurement ofinnovation in the private and publicsector• Measure investment in intangibleassets in the UK and estimate itscontribution to economic growth• Use a methodology consistent withthe national accounts, with datafrom:– Intangible assets survey– Input-output tables– Several ONS surveys
  8. 8. The UK economy∗is 10 per cent larger counting intangiblesSource: Nesta Innovation Index
  9. 9. R&D is only 13 per cent of intangible investmentSource: Nesta Innovation IndexInvestment in intangibles by type, 2009 (£bn)
  10. 10. The UK invests more in intangibles than tangiblesSource: Nesta Innovation Index£ billion (current prices)tangiblesIntangibles / IP
  11. 11. Large cross-country differences on intangible investmentSource: OECDIntangible to tangible investment ratio1,64 1.601,23 1,200,89 0,89 0,86 0,840,73 0,710,650,46 0,440,400,300,230,00,51,01,52,0UnitedKingdomUnitedStatesSwedenFinlandDenmarkFranceGermanyCanada*Japan*Portugal*AustriaSpainAustraliaCzechRepublicItalySlovakRepublic
  12. 12. Source: OECDIntangible to tangible investment ratio1,64 1.601,23 1,200,89 0,89 0,86 0,840,73 0,710,650,46 0,440,400,300,230,00,51,01,52,0UnitedKingdomUnitedStatesSwedenFinlandDenmarkFranceGermanyCanada*Japan*Portugal*AustriaSpainAustraliaCzechRepublicItalySlovakRepublicInnovation LeadersInnovation FollowersModerate InnovatorsEuropean InnovationScoreboard Grade:Large cross-country differences on intangible investment
  13. 13. There are large differences across sectorsSource: Nesta Innovation IndexInvestment in intangibles relative to gross value added in the sector
  14. 14. The relative importance of intangibles also variesSource: Nesta Innovation IndexIntangible-tangible investment ratio by sector, 2007
  15. 15. Each sector innovates in a different wayShare of intangible investment by sector and type, 2007Source: Nesta Innovation Index
  16. 16. Innovation support policies are not sector neutralSource: Nesta Innovation IndexShare of intangible investment by type and sector, 2007
  17. 17. Innovation makes a large contribution to growthSource: Nesta Innovation IndexContribution to productivity growth, % 2000 - 20080 1 2 37%30%23%40%Intangibleinvestment TFPLabour qualityCapitalinvestment2.240.900.510.670.16TotalTotal factor productivity(inc. wider benefits ofinnovations)Investment inintangiblesCapital investmentLabour quality

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