Innovation Policy: A Guide for Developing Countries

Contents......Page 7
Foreword......Page 17
Preface......Page 19
Abbreviations......Page 21
Why? The Innovation Imperative......Page 25
What? The Government as a Gardener......Page 26
How? A Pragmatic Agenda......Page 27
What Is Innovation?......Page 28
0.1 A Few Examples of Innovations in Developing and Emerging Economies......Page 29
0.6 Model for a Strong Innovation Policy......Page 35
Policy Implementation......Page 41
Conclusion......Page 46
References......Page 48
Innovation, Did You Say?......Page 49
What Is This Book About?......Page 51
Part I Policy Concept......Page 53
1 Why Promote Innovation? The Key to Economic, Social, and Environmental Progress......Page 55
1.1 World Population Growth and Major Technological Events, 9000 BC to Present......Page 56
Technology and Economic Growth......Page 62
Innovation and Emerging Economies......Page 67
Dissemination of Technology......Page 70
1.7 Percentage of Rural and Urban Population with Access to Sanitation, 1990 and 2004......Page 72
Notes......Page 74
References and Other Resources......Page 75
2 How to Promote Innovation: Policy Principles......Page 77
Adopt a "Whole-of-Government" Approach......Page 78
2.5 Government Roles in Encouraging Innovation......Page 84
Put Efficient Institutions and Instruments in Place......Page 89
2.1 East-West Contrasts in Socioeconomic Systems......Page 91
Policy Conclusions for Developing Countries......Page 92
Notes......Page 93
References......Page 94
Part II Policy Functions......Page 95
3 Supporting Innovators......Page 97
Provision of Business Services......Page 98
Entrepreneurship and New Innovating Firms......Page 107
3.5 Singapore: Incubators Underpinning a Relationship Hub......Page 113
Bridging Institutions: Clusters and Networks......Page 117
Conclusions......Page 126
Notes......Page 127
References and Other Resources......Page 128
4 Improving the Regulatory Framework for Innovation......Page 131
International Trade and Investment Framework......Page 132
Domestic Institutional and Regulatory Framework......Page 140
Procurement Policies for Innovation......Page 149
Notes......Page 154
References and Other Resources......Page 156
Global Overview of R&D......Page 159
R&D in Developing Countries......Page 163
Public Sector R&D in Developing Countries......Page 172
Private Sector R&D in Developing Countries......Page 174
International R&D Cooperation and Research Programs......Page 181
Summary and Conclusions......Page 183
Notes......Page 184
References and Other Resources......Page 185
Skills for a Knowledge-Based and Innovation-Driven Economy......Page 189
6.1 Distribution of African University Graduates by Field of Study, 2005......Page 197
6.2 Characteristics of Traditional and Lifelong Learning Models......Page 199
Beyond Formal General Education......Page 207
From Brain Drain to Brain Circulation......Page 214
6.2 Hierarchy of Diaspora Impact on Institutional Reform in Developing Countries......Page 218
References and Other Resources......Page 219
7 Policy Evaluation: Assessing Innovation Systems and Programs......Page 223
Benchmarking Innovation at the Country Level......Page 224
Microlevel Innovation Surveys......Page 230
Program Evaluation......Page 237
Innovation Policy Reviews......Page 248
Conclusions......Page 254
Notes......Page 256
References and Other Resources......Page 257
Part III Policy Implementation......Page 259
Adapting Best Practices to the Local Context: The Pragmatic Innovation Agenda......Page 261
How to Create a Conducive Institutional Framework: The Virtuous Cycle......Page 279
Creating Frameworks for Change: Strategic Incrementalism......Page 286
Summary of Policy Principles......Page 291
References and Other Resources......Page 292
9 Promoting Competitive and Innovative Industries......Page 295
Innovation, a Global Phenomenon......Page 296
Agriculture......Page 299
Manufacturing......Page 307
Services......Page 312
9.3 Competitive Industries and Innovation Systems in China, Costa Rica, Rwanda, and Vietnam......Page 319
Notes......Page 322
References and Other Resources......Page 323
10 Building Innovative Sites......Page 327
Special Economic Zones......Page 328
10.4 A Tale of Two Countries—Investment Climate Reform......Page 334
Clusters......Page 340
Fostering Innovation in a City or Region......Page 347
10.12 The Vancouver Agreement......Page 353
Notes......Page 354
References and Other Resources......Page 355
How to Define Inclusive Innovations, Pro-Poor Innovations......Page 359
Harnessing Formal Innovation Efforts for the Poor......Page 362
Promoting Grassroots Innovation and Knowledge Initiatives......Page 380
Enabling the Informal Sector to Absorb Knowledge and Technology......Page 386
Notes......Page 393
References and Other Resources......Page 394
Index......Page 399
0.5 Innovation Policy in a Broad Perspective......Page 34
0.3 Business Services for Innovators......Page 36
1.1 Innovation Is Essential to Tackling Climate Change......Page 61
1.7 Per Capita GDP for Selected Countries or Regions, 1480–1998......Page 63
2.1 A Brief History of Innovation Policy in OECD Countries......Page 80
3.1 Priorities for Business Services Support Schemes......Page 101
3.2 Knowledge Vouchers......Page 109
3.3 Types of Incubators......Page 110
3.4 Good Practices for Business Incubators......Page 112
3.6 SME Clusters in India......Page 118
3.7 The Role of Trade Associations in Italy......Page 120
3.8 Sector Associations in Senegal and Cameroon......Page 121
3.9 Denmark's Network Program: Brokers and Scouts......Page 123
3.10 Networking Programs: The International Experience......Page 125
4.1 Brazil's Policy on HIV/AIDS......Page 137
4.2 From Duplicative Imitation to Creative Imitation and Innovation......Page 139
4.3 Kenya's Radical Licensing Reform, 2005–07......Page 143
4.4 Railways and Competition......Page 145
4.5 Variable Message Signs for British Highways......Page 151
4.6 The Swedish Energy Agency's Procurement Procedures......Page 153
5.1 Becoming a More Internationally Competitive, Market-Driven R&D Organization......Page 173
6.1 What Does a Learner-Centered Classroom Look Like?......Page 200
6.2 Learner-Centered Teaching for the Knowledge Economy......Page 201
6.3 Entrepreneurship Program at Walhalla High School, South Carolina, United States......Page 206
6.4 Mexico's Proactive Training Programs for SMEs......Page 212
7.1 Examples of Indicators from Innovation Surveys......Page 231
7.2 Additional Sources of Innovation-Related Indicators......Page 233
7.3 Effective Policy and Program Evaluation Challenges for Designing Evaluation Schemes......Page 238
7.4 Emerging Cross-Cutting Issues in the Evaluation of Publicly Funded Research......Page 244
7.5 National Innovation Strategies: Lessons from OECD Country Reviews......Page 250
7.6 Beyond GDP: Alternative Measures and Indicators of Economic and Social Progress......Page 255
8.1 Private and Public Sector Entrepreneurs Come Together: An Irish Experience......Page 263
8.2 Turning Scientists into Entrepreneurs: Moscow University's Science Park......Page 272
8.3 Diaspora Member Creates First-Mover Institution in Tertiary Education......Page 274
8.4 Members of the Diaspora Trigger Changes in Innovation Systems......Page 281
8.5 A Framework Program to Promote Experimentation in a Rural Setting: The Spark Program......Page 287
9.1 China, an Emerging Leader in Wind Power......Page 297
9.2 Mauritius, Reinventing for Survival in the Global Economy......Page 298
9.3 Main Messages from Agribusiness and Innovation Systems in Africa......Page 303
9.4 Malaysia's Palm Oil Industry......Page 305
9.5 Gold Jewelry in Turkey......Page 308
9.6 Producing Jeans in Toritama, Brazil......Page 309
9.7 The Software Industry in India......Page 317
10.1 The Development of Backward Links: A Successful and a Less Successful Example......Page 331
10.3 SEZs and Labor Circulation„A "Domestic Skilled Diaspora"?......Page 333
10.2 Evolution of Science Parks over Time......Page 336
10.6 Greater Sfax Development Strategy and the Science Park......Page 337
10.7 TEKEL......Page 338
10.8 Different Cluster Initiators......Page 342
10.9 Demanding Local Consumers......Page 345
10.10 The Creative Class?......Page 349
10.11 CUORE in Naples......Page 352
11.1 Adapting Public Research Systems for Development Needs in India......Page 365
11.2 Pro-Poor Innovations at University Research Centers in Africa......Page 366
11.3 The 4 Billion at the Base of the Economic Pyramid......Page 369
11.4 The Private Sector as Provider of Products and Services for the Poor......Page 370
11.5 Pro-Poor Public-Private Partnerships......Page 373
11.6 Examples of Socially Driven Pro-Poor Initiatives......Page 375
11.7 Using Indigenous Knowledge to Improve Health and Raise Agricultural Productivity......Page 382
11.8 Benefit-Sharing Arrangements and Intellectual Property Protection for Indigenous and Traditional Knowledge......Page 384
11.9 Participatory Development of Improved Groundnut Varieties in Ghana......Page 388
11.10 Public-Private Technology Information Service in Rwanda......Page 391
11.11 Financial Institutions That Serve the Poor......Page 392
0.1 How Innovation Contributes to Growth: A Comparison of Ghana and the Republic of Korea, 1960–2005......Page 30
0.2 Major Technical Systems from the Middle Ages through the Present......Page 31
0.3 Determinants of Technology Upgrading in Developing Countries: Domestic Absorptive Capacity Both Conditions and Attracts External Flows......Page 32
0.4 Gardening Innovation......Page 33
0.7 Scaling Up Institutional Change, from Microreforms to National Reforms......Page 44
1.3 Growth in Population and GDP per Capita in the Past 2,000 Years......Page 57
1.4 Structure of the Global Technical System......Page 58
1.5 The Industrial Revolution in Europe, 1750–1970......Page 59
1.1 Industries and Infrastructure of Each Technological Revolution, 1770–1970......Page 60
2.2 Organizational and Marketing Elements of the Wine Industry in South Africa......Page 79
2.3 Creating Favorable Conditions for Innovation......Page 82
2.4 Schematic of the Innovation System in a Developing Country......Page 83
2.7 Comprehensive Layout of Innovation Policy......Page 90
3.1 Shanghai R&D Public Service Platform......Page 102
3.2 Financing Cycle for New Technology-Based Firms......Page 114
4.1 Example of a Phased Precommercial Procurement Process......Page 152
5.1 Gross Domestic Expenditures on R&D by Area, 1996–2006......Page 160
5.2 Relative R&D Expenditures and Number of Scientists and Engineers in G5 Countries and BRICs, 2006 PPP......Page 164
5.3 R&D Expenditures as a Percentage of GDP for Selected Economies, 2005 PPP......Page 165
5.4 R&D Expenditures by Sector as a Percentage of National Total in Selected Economies, 2005......Page 167
6.1 Long-Run Trends in Skilled Emigration in Developing Countries, 1975–2000......Page 216
8.1 Elements of Strategic Incrementalism......Page 288
9.1 Conceptual Diagram of an Agricultural Innovation System......Page 302
10.1 "Island" versus "Catalyst" Special Economic Zones......Page 329
0.1 Direct Support for Business Sector Research and Development......Page 39
0.2 Country Contexts and Strategic Focal Points......Page 43
1.3 Level of Productivity in Countries of Various Incomes, 1970–2000......Page 66
1.4 Productivity Dispersion in Brazil's Industrial Sectors, Mid-2000s......Page 69
1.6 Percentage of Rural and Urban Population with Access to Clean Water, 1990 and 2004......Page 71
1.8 Rate of Dissemination of Major Technologies, 1748–2000......Page 73
3.1 Private Equity Fund-Raising in Emerging Markets, 2003–05......Page 116
4.1 Example of Transaction Costs Related to the Legal and Regulatory Environment......Page 141
5.1 R&D Performed in Government and Universities as a Percentage of GDP, 1996–2006......Page 161
5.2 R&D Expenditure by Source of Financing: Main OECD and 10 Developing and Emerging Economies, 2005......Page 166
5.3 Number of Patents Granted by the U.S. Patent and Trademark Office, 2008......Page 168
5.4 Advantages and Disadvantages of Instruments for Encouraging Innovation and R&D......Page 170
5.5 Top-10 R&D Companies from Developing and Emerging Economies, 2007......Page 175
5.7 Utility Patents Granted by the U.S. Patent and Trademark Office to the Top-15 Developing and Emerging Economies, 2008......Page 176
5.8 Illustrative Examples of Innovations by Developing Economy Firms......Page 177
5.10 General Science and Technology Instruments for Supporting Business R&D......Page 178
5.11 Selected Research Universities from the World's Top 100 and 500, by Country......Page 180
5.12 Instruments for Promoting Relevant R&D in Universities and Greater Commercialization of Knowledge and Interaction with Enterprises......Page 182
7.1 Rankings of Economies for the Knowledge Assessment Methodology, Global Competitiveness, and Global Innovation Indexes, 2008–09......Page 228
8.1 Diversity of Pragmatic Innovation Agendas......Page 267
8.2 Possible Innovation Paths for Saudi Arabia......Page 276
9.1 Leading Exporters of High-Value Commodities in Developing Countries......Page 304
9.2 Moving Up the Value Chain in Tourism in Costa Rica, 1980s–Future......Page 315
10.1 Training for Workers in SEZs in Selected Economies......Page 332
10.2 Encouraging Innovation through SEZs......Page 335
11.1 Progress toward Meeting Millennium Development Goals in Four Regions, 2006......Page 361
11.2 Three Models for Enabling Businesses to Serve the Poor Economically......Page 372