DC10 Frans van Vught - keynote - a European innovation strategy for the services sector


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Frans van Vught from Nether is presenting at the First National Annual Services Innovation Conference, November 2, 2010, organized by Exser and partners. See http://www.exser.nl/jaarcongres/ for more information.

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DC10 Frans van Vught - keynote - a European innovation strategy for the services sector

  1. 1. A European Innovation Strategy for the Services Sector Frans van Vught
  2. 2. Globalisation <ul><li>economic </li></ul><ul><li>political </li></ul><ul><li>socio-cultural </li></ul>
  3. 3. Globalisation and Innovation <ul><li>globalisation triggers national innovation policies </li></ul><ul><li>national innovation policies focus increasingly on stimulating the creation, transfer and application of knowledge </li></ul><ul><li>national innovation policies are influenced by the “National Innovation system” (NIS) perspective </li></ul>
  4. 4. The perspective of National Innovation Systems (NIS) <ul><li>emerged during 1980s as a new approach to the economics of innovation </li></ul><ul><li>emphasises interactions between scientific knowledge and new products and services </li></ul><ul><li>takes an explicit policy orientation </li></ul><ul><li>identifies academic institutions as playing a critical role </li></ul><ul><li>distinguishes two crucial outputs of these institutions: </li></ul><ul><li>- research outputs (publications, patents) </li></ul><ul><li>- highly skilled human capital </li></ul><ul><li>focuses on linkages between actors in innovation processes: </li></ul><ul><li>- hard linkages (science parks, incubators) </li></ul><ul><li>- soft linkages (internships, conferences) </li></ul><ul><li>addresses institutional framework conditions of innovation processes (regulations, incentives) </li></ul>
  5. 5. Research project <ul><li>international comparative study of national innovation policies </li></ul><ul><li>Australia, Canada, Europe, Japan, US. </li></ul><ul><li>to be published in: </li></ul><ul><li>David D. Dill & Frans A. van Vught (eds), </li></ul><ul><li>“ National Innovation and the Academic Research Enterprise: Public Policy in Global Perspective” </li></ul><ul><li>Johns Hopkins University Press, Baltimore, 2010 </li></ul>
  6. 6. National innovation policy strategies <ul><li>clearly influenced by the NIS perspective </li></ul><ul><li>relate policy instruments to policy objectives regarding innovation </li></ul><ul><li>consist of some combination of the basic notions of market coordination and central planning </li></ul><ul><li>two large categories: </li></ul><ul><li>- prioritisation strategies </li></ul><ul><li>- competition strategies </li></ul>
  7. 7. Prioritisation strategies <ul><li>reflects notions of central planning </li></ul><ul><li>characteristics like: foresight analyses, priority allocation, concentration of resources, quality assessment of outputs </li></ul><ul><li>examples - Australia’s research priority setting </li></ul><ul><li>- Canada’s centres of excellence </li></ul><ul><li> - Finland’s TEKES agency </li></ul><ul><li>- UK’s foresight assessments and RAEs </li></ul><ul><li>- Netherlands’ innovation platform </li></ul>
  8. 8. Competition strategies <ul><li>reflects notion of market coordination </li></ul><ul><li>characteristics like: competitive allocation of resources, </li></ul><ul><li>encouraging entrepreneurial academic behaviour, </li></ul><ul><li>deregulation, diversifying funding base </li></ul><ul><li>examples - US federal science policy </li></ul><ul><li> - Japan’s competitive grants scheme for </li></ul><ul><li> doctoral training </li></ul><ul><li>- Canada’s competitive research matching </li></ul><ul><li> funding </li></ul><ul><li>- Germany’s excellence policy </li></ul><ul><li>- UK’s competitive ‘third sector’ funding </li></ul><ul><li> </li></ul>
  9. 9. Globalisation and ‘Geo-Regionalisation ’ *) data 2006 Source: UNCTAD Handbook of Statistics 2008 Trade volumes in billions dollars 1990 1995 2000 2005 2007 Total % internal Total % internal Total % internal Total % internal Total % internal* ECOWAS 23 7 21 9 36 8 65 8 66 8 SADC 35 3 39 11 51 9 98 8 139 7 MERCOSUR 46 9 70 20 85 21 164 13 224 14 NAFTA 562 40 853 46 1.225 55 1.480 56 1.851 54 ASEAN 145 19 324 25 432 23 653 25 866 25 ASEAN+3 560 27 1.048 35 1.333 35 2.294 35 3.165 - EU27 1.547 67 2.098 66 2.454 67 4.071 67 5.284 67
  10. 10. Economic growth in the EU <ul><li>20 th century: manufacturing / technology as the </li></ul><ul><li>engine of prosperity </li></ul><ul><li>21 st century: the rise of service industries </li></ul><ul><li> and </li></ul><ul><li>increasing service focus of manufacturing firms (‘servitisation of products’) </li></ul>
  11. 11. The European Economy is a ‘Services Economy’ <ul><li>nearly all employment growth in the EU between 1995 and 2007 was due to services </li></ul><ul><li>69.2% of total employment was in Services Sector </li></ul><ul><li>71.6% of gross value added took place in Services Sector </li></ul>
  12. 12. A New Engine of Growth <ul><li>while total employment grew by 1% per year, service employment increased by 1.8% per year (1995-2007) </li></ul><ul><li>while total gross value added per year grew by 2.1% per year, the Services Sector showed an increase of 2.3% per year (1995-2007) </li></ul><ul><li>most important factor for services growth is the income increase in high income countries; EU Member States with high levels of GDP per capita also have high service shares in employment and gross value added </li></ul><ul><li>the most dynamic Services Sectors in the EU are: communication, financial services, business services, computer activities, energy, transport & distributive services </li></ul>
  13. 13. Knowledge-intensive Services <ul><li>high knowledge intensity; relative capital intensity; high degree of specialisation </li></ul><ul><li>main source of job creation in EU </li></ul><ul><li>high-tech knowledge-intensive services contribute most to growth of value-added </li></ul><ul><li>a real driver of innovation: </li></ul><ul><li>- in industries </li></ul><ul><li>- in regions and nations </li></ul>
  14. 14. Services Sector in Clusters <ul><li>the ‘cluster concept’ provides a way to understand economic dynamics </li></ul><ul><li>clusters are: groups of firms, and other institutions that are located near each other and have reached a sufficient scale to develop specialised expertise and to create economic innovation and growth </li></ul><ul><li>the Services Sector: </li></ul><ul><li>- combines with the manufacturing sector to create joint </li></ul><ul><li> clusters </li></ul><ul><li>- offers the core of specialised service clusters (182 service </li></ul><ul><li> clusters of the 788 clusters in the EU; European Cluster </li></ul><ul><li> Observatory) </li></ul><ul><li> </li></ul>
  15. 15. An EU Innovation Policy for the Services Sector? <ul><li>services innovation has only recently entered the EU policy discussions </li></ul><ul><li>Europe still lacks innovative service enterprises with a global reach </li></ul><ul><li>EU Services Sector innovation policy needs to differ from technological innovation policy </li></ul><ul><li>Service Directive (2006): cross-border trade of services; easier market access </li></ul><ul><li>European Services Innovation Memorandum (2007): ‘emerging services innovation policy in Europe is in a unique situation where it has a possibility to renew the entire innovation policy towards a more balanced and demand driver concept’ </li></ul><ul><li>EU Member States are developing Services Sector cluster policies (Finland, France, Netherlands, Spain, UK) </li></ul>
  16. 16. An EU Innovation Policy for the Services Sector? <ul><li>existing Community instruments can be better used : Framework Programmes (R&D), European Institute of Technology (KICs), Lead Markets Initiative (eHealth, sustainable construction, renewable energies), Competiveness and Innovation Programme (CIP), Cohesion Policy (Structural Funds) </li></ul><ul><li>knowledge base for services must be broadened : more R&D, better skills development, better knowledge exchange and distribution </li></ul><ul><li>new forms of support for service clusters must be developed: users focus, open innovation systems, clusters networks, public procurement </li></ul>
  17. 17. <ul><li>‘ The future prosperity of Europe will to a large extent depend upon our ability to develop and implement new and better innovation support mechanisms for the Services Sector’ </li></ul>
  18. 18. <ul><li>Thank you for your attention! </li></ul><ul><li>Frans van Vught </li></ul><ul><li>Nether </li></ul><ul><li>[email_address] </li></ul>