Increasing the impact of public investments in innovation
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Increasing the impact of public investments in innovation
Three questions
What to invest in
How much to invest
R&D Labour Productivity
60%
Intangibles Unicorns
1.12%
European Union United States
How to invest effectively
14740 evaluations of support schemes
€150
Little credible
billion evidence on
what works, and
spent every year on innovation,
entrepreneurship and business growth support
what doesn’t
programmes in Europe alone
But slow productivity growth and
convergence in Europe
Credible (2.4%) + Impact (0.6%)
Source:http://www.innovationgrowthlab.org/blog/much-%E2%82%AC152-billion-spent-acro Source: Systematic reviews conducted by the What Works Centre for Local Economic Growth
ss-europe-supporting-businesses-does-it-work at the LSE (Credible: Level 3 Maryland Scale – Positive impact on employment)
Becoming more experimental
Why experiment
Novel solutions to De-risk Continuous
policy challenges new programmes improvement
Time-limited unless Better evidence &
Save money
demonstrated impact decisions
More impactful policies & better value-for-money
Trials can have a powerful impact
More effective messages: the UK’s Business Additional 800
Department used ‘nudging’ trials experimenting with mentors recruited,
different language to recruit business mentors policy target met
New research collaborations: Harvard Medical School Researchers were 75%
researchers were randomised to meet as part of a more likely to
grant programme information session collaborate
More successful startups by making a small tweak:
Startups raised +50%
the Startup Chile accelerator trialled sharing
more funding
application feedback with its participants
Helping businesses grow with a low-cost networking Increased firm revenue
intervention: two academics trialled monthly meetings by 8%
between business owners in China
Read more about what we’re learning from policy experiments
How to become experimental
right incentives
experimentation
funds
An experimental €1 bn productivity fund
An impactful BICC investment
Leverage BICC to increase the
effectiveness and efficiency of member
states investment
€1,000 billion
European countries’ expected expenditure in policies to
support businesses to innovate and grow in 2021-2027
Invest 0.1% (€1 bn) to find
ways to maximise the impact
of the remaining 99.9%Some potential programme areas
Innovation in how we regulate
SANDBOX
Testbeds
Regulators’
Pioneer
FundReinventing business regulation
The “Eurocompany”: a new full-fledged business regime, sitting alongside national
regimes without replacing them (either EU-wide or for a smaller group of countries)
Innovate in regulation Less-fragmented Reduce competitiveness
and enforcement internal market differentials
Piecemeal regulatory reforms Give startups the option to Give entrepreneurs from
constrained by status quo operate under the same rules countries with poor regulatory
and institutional inertia → across the EU through a environments the opportunity
This 29th regime would single digital platform, while to opt-out from inefficient
create a new system from preserving the rights of national rules (introducing
scratch designed for the 21st member states over specific regulatory competition
century, not one inherited issues → Help innovative without a race to the bottom)
from the 19th century startups to grow faster → Accelerate convergenceChanging systems
TRANSFORM FUNDING Higher
More impactful support innovation
Experimental 1 billion
programmes and funding
productivity fund
instruments Faster
economic
TRANSFORM REGULATION growth
More innovation-friendly
“Eurocompany” Better living
and less fragmented
business regime
regulatory regime standardsConclusion
Annex: About the Innovation Growth Lab
A global partnership
bringing together
governments, foundations
and researchers to scope,
What IGL is develop and test different
approaches to increase
innovation, support
high-growth
entrepreneurship and
accelerate business growthIGL – A global community for better policies through experimentation
IGL Partners IGL Research Network
Over 85 researchers from around the world:
IGL Scientific Committee
Nick Bloom Stanford Graduate School of Business | Dietmar Harhoff
Max Planck Institute for Innovation and Competition | Karim Lakhani
Harvard Business School | Josh Lerner Harvard Business School | Fiona
Murray MIT Sloan | Mark Schankerman LSE | Scott Stern MIT Sloan |
John Van Reenen MIT Sloan
Other organisations we’ve worked with:You can also read
