Science, Technology and Innovation indicators: benchmarking R&D policies An historical perspective...

Science, Technology and Innovation indicators:benchmarking R&D policies

• An historical perspective

• The “Frascati Manual” and the “Oslo Manual”

• S&T indicators

• Innovation indicators

• Some evidence from innovation surveys

• Concluding remarks

C&T in OCDE: 63-95C&T in OCDE: 63-95

DE

NL

BE

PTGR

ITIE

US

JP

UK

FR

0

2

4

6

8

10

12

14

0 0,5 1 1,5 2 2,5 3 3,5

1963Staff in R&D / 1000 inhabitants

% GNP applied in R&D

DE

NL

UEBE

PT

GR

IT

IE US

JPUK

FR

0

2

4

6

8

10

12

14

0 0,5 1 1,5 2 2,5 3 3,5

1995

DE

NL

BE

PTGR

ITIE

US

JP

UK

FR UE

JP

0

2

4

6

8

10

12

14

0 0,5 1 1,5 2 2,5 3 3,5

S&T indicators: evolving from basic indicatores...

• Output, impact, efficiency: output/input

... The need for: terms of reference

a model of analysis

Which effects to be considered???

• Other effects: how to consider the “context”??• Time• Scale: scale/intensity• Structure• Space• .....

The exponential growth of S&T indicators at the international level

Decades 50s and 60s 70s 80s 90s

Main indicators used Re&D Re&D Re&D Re&DPatents Patents PatentsTechnological balance Technological balance Technological balanceof payments of payments of payments

High-tech products High-tech productsand sectors and sectorsBibliometrics BibliometricsHuman resources Human resources

Innovation surveys Innovation surveysInnovations mentioned intechnical literatureSurveys of productiontechnologiesGovernment support toindustrial technologyIntangible investmentIndicators of informationand communication technologiesInput-Output matrixes *Productivity *Venture capital *Mergers and acquisitions *

* Indicators mutuated from economic analysis.

Definition of research and development (Frascati Manual)

• R&D is defined as creative work undertaken on a systematic basis in order to increase the stock of knowledge including knowledge of man, culture and society, and the use of this stock of knowledge to devise new applications.

The linear model

• Research-based

• Sequential

• Tecnocratic

Period 1960's-1970's 1980's-early1990's

1990's - nextmillennium

Model Linear model Chain-linkedmodel

Systemsapproaches

Conception Simple Complex Extremelycomplex

Number ofindicators

Few(R&D, patents,TBP)

Many(R&D, patents,bibliometrics,innovation, hightech products,humanresources)

Too many(combinationsof existing andpossibly newindicators,quantitative/qualitative)

Development of indicators

“The Chain Link Model”

Potential Markets

Invention/analytical design

Detailed design & Test

Re-design & Production

Distribution & market

Knowledge

Research

Kline & Rosenberg (1986)

Technology platforms

BUS

“Communities of practice”

Technological innovation(Oslo Manual)

• Technological innovations comprise new products and processes and significant technological changes of products, services and processes.

• An innovation has been implemented if it has been introduced on the market (product and service innovation) or used within a production process (process innovation).

Technological innovation(Oslo Manual)

• Innovations involve a series of scientific, technological, organisational, financial and commercial activities.

• The product or process should be new (or rignificantly improved) to the firm (it does not necessarily have to be new to the relevant market)

Science and technology indicators

• Human resources for S&T • R&D• Patents• Bibliometrics• Technological balance of payments• Trade in high-tech products

Permilagem de investigadores (ETI) pela população activa, para o último ano disponível

2.803.303.31

4.564.885.055.155.405.49

6.206.456.46

6.958.08

9.109.26

13.08

0.00 2.00 4.00 6.00 8.00 10.00 12.00 14.00

ItáliaGrécia

PortugalEspanha

ÁustriaIrlanda

HolandaEuropa 15

Reino UnidoFrança

AlemanhaDinamarca

BélgicaEUA

SuéciaJapão

Finlândia

Notas: FIN, JP, E, P: 2000; Uk, A: 1998; EUA: 1997; Todos os outros países: 1999. Média da UE não inclui o Luxemburgo

Fonte: European Commission, Key Figures 2002 – Science, Technology and Innovation

Novos doutorados em ciência e tecnologia por permilagem de população entre os 25 e os 34 anos,

para o último ano disponível

0.160.19

0.240.26

0.340.36

0.480.490.50

0.560.590.60

0.680.76

0.811.09

1.24

0.00 0.20 0.40 0.60 0.80 1.00 1.20 1.40

ItáliaGréciaJapão

PortugalHolanda

EspanhaEUA

DinamarcaIrlanda

Europa 15ÁustriaBélgica

Reino UnidoFrança

AlemanhaFinlândia

Suécia

Notas: I, UE: 1999; todos os outros países referem-se a 2000; A média da UE não inclui o Luxemburgo; Os dados da Espanha são provisionais.


The effect of scale:

Scale vs Intensity in R&D

Scale vs Intensity in R&D(OECD, 2000)

Sweden

Finland Japan

France

Germanythe Netherlands

Denmark

UK

US

Belgium

Austria

Ireland

Italy

SpainPortugal

Greece

0

0,005

0,01

0,015

0,02

0,025

0,03

0,035

0,04

100 1000 10000 100000 1000000

Scale- Total Expenditure in R&D ($PPP; logarithmic scale)

Inte

nsit

y-

Sh

are

of

GD

P s

pen

t o

n R

&D

The effect of time:Dynamic effects to complement static data

Crescimento médio anual dos investigadores pela população activa, para o último ano disponível

-2.00 0.00 2.00 4.00 6.00 8.00 10.00 12.00

Itália

França

Alemanha

Japão

Reino UnidoEuropa 15

Dinamarca

Suécia

Holanda

EUA

BélgicaPortugal

Espanha

Irlanda

Finlândia

Grécia

Notas: FIN, JP, E, P: 2000; UK, A: 1998; EUA: 1997; Todos os outros países: 1999. Média da UE não inclui o Luxemburgo e a Áustria.


Crescimento de Novos doutorados por permilagem de população, entre os 25 e os 34 anos, entre 1999 e 2000

-4.80-2.76

0.070.26

0.741.05

1.542.452.642.75

3.934.29

5.248.52

9.099.76

13.98

-5.00 0.00 5.00 10.00 15.00

HolandaIrlandaEUADinamarcaJapãoFrançaEuropa 15ÁustriaItáliaAlemanhaBélgicaSuéciaReino UnidoEspanhaGréciaFinlândiaPortugal

Notas: I, UE: 1998-1999. A média da UE não inclui o LuxemburgoFonte: European Commission, Key Figures 2002 – Science, Technology and Innovation

GERD: 1995 - 1999

1.0

1.8

2.6

2.8

3.4

3.8

4.2

5.1

5.6

5.7

5.9

6.0

6.9

8.2

9.9

12.0

13.5

0.0 2.0 4.0 6.0 8.0 10.0 12.0 14.0

França

Reino Unido

Itália

Japão

Europa 15

Alemanha

Holanda

Suécia

Áustria

EUA

Dinamarca

Bélgica

Espanha

Irlanda

Portugal

Grécia

Finlândia

Notas: B, DK, EL, IRL, I, NL, S: 1995-1999; JP: 1996-2000; Todos os outros países e UE: 1995-2000. A média da UE não inclui o Luxemburgo


0,0000

0,5000

1,0000

1,5000

2,0000

2,5000

Federal Support for R&D as a Percent of GDP Nonfederal Support for R&D as a Percent of GDP

The historical evidence: intensity of R&D support in US

Conceição, Heitor and Oliveira(2001)

Federal

Private

The historical evidence: cumulative R&D support in US

Conceição, Heitor and Oliveira(2001)

0

10

20

30

40

50

60

70

Federal Support for R&D as a Percent of GDP Nonfederal Support for R&D as a Percent of GDP

Private

Federal

0

0,025

0,05

0,075

0,1

0 0,125 0,25 0,375 0,5

Pub

lic

R&

D E

xpen

ditu

res

per

capi

ta

Private R&D Expenditures per capita

Canada

DenmarkFinland

France

Germany

Ireland

Japan

Netherlands

Norway

PortugalSpain

Sweden

UK

US

Belgium

Canada

Czech Rep

Denmark Finland

France

Germany

Hungary

Ireland

Japan

Korea

Mexico

Netherlands

New Zealand

Norway

Poland

Portugal

SpainSweden

Turkey

UK

US

Perspectives for “change”:Perspectives for “change”:Public vs private R&D expendituresPublic vs private R&D expenditures

P97

P95

P81

ESIR

SE

JP

USA

FR

D

UK

characterizing structure:Public and private funding of R&D

0.00 10.00 20.00 30.00 40.00 50.00 60.00 70.00 80.00

Portugal (1997)Greece (1997)

Mexico New Zealand (1997)

Turkey (1997)Hungary

PolandAustralia (1998)

IcelandSpain

ItalyNetherlands (1998)

Austria (1993)Norway (1997)

CanadaDenmark

Slovak RepublicCzech Republic

FranceEU

United KingdomFinland

GermanyOECDJapan

Switzerland (1996)Korea

Belgium (1997)Ireland (1997)

Sweden (1997)United States

Business Expenditure on R&D as a Percentage of the Total Expenditure on R&D (1999)

With the exception of the less developed OECD countries, business expenditure on R&D accounts for the majority of total expenditure, and has an overwhelming share (close or above ¾) in the most developed countries

With the exception of the less developed OECD countries, business expenditure on R&D accounts for the majority of total expenditure, and has an overwhelming share (close or above ¾) in the most developed countries

BERD / GERDBERD / GERD

Share of R&D funding (OECD) OECD, S&T Databases, Sept. 2001

United States

United Kingdom

Turkey

Switzerland

Sweden

Spain Slovak Republic

Portugal

Poland

Norway

New Zealand

Netherlands

Mexico

KoreaJapan

Italy

Ireland

Iceland

Hungary

Greece

Germany

France

Finland

Denmark

Czech RepublicCanada

Belgium

Austria Australia

Business

Higher Education Government0

100

100

0

100

Industry-dominated systems

Balanced Industry+ /government systems

Balanced Industry/government+ systems

Government-dominated systems

Share of R&D expenditure (OECD) OECD, S&T Databases, Sept. 2001

Australia

Austria

Belgium

CanadaCzech RepublicDenmark

Finland

France

Germany

Greece

Hungary

Iceland

Ireland

Italy

JapanKorea

Mexico

Netherlands

New Zealand

Norway

Poland

Portugal

Slovak Republic

Spain

Sweden

Switzerland

Turkey

United Kingdom

United States

Business

Higher Education Public research institutions0

100

100

0

100

0

Industry-dominated systems

Balanced industry/government systems with universities being more important performers than public

research institutions

Government-dominated systems

Balanced industry/government systems with public research institutions being more important

performers than universities

Share of R&D funding and expenditure (OECD)

OECD, S&T Databases, Sept. 2001

Industry dominated systems Balanced systems (universities)

Balanced systems (public labs) Government dominated systems

0 0

0

100

100 100

Business

Higher education Government

FundingPerforming

Portugal

USA

Spain

Irland

Hungary

Netherlands

Variation of BERD: 1995-1999

0.981.99

2.433.553.81

4.815.445.665.946.24

8.409.299.30

10.5211.92

12.6917.36

0.00 2.00 4.00 6.00 8.00 10.00 12.00 14.00 16.00 18.00

ItáliaReino Unido

JapãoÁustriaFrança

Europa 15Alemanha

BélgicaSuécia

HolandaEUA

EspanhaIrlandaGrécia

PortugalDinamarca

Finlândia

Notas: JP:1996-2000; A, D, E, P, FIN, EUA: 1995-2000; Todos os outros países e UE:1995-1999Fonte: European Commission, Key Figures 2002 – Science, Technology and Innovation

Comparative growth in public and total R&D expenditures

(average annual growth rates over 1995-2001, or nearest years available)

TurkeyChina

Portugal

New ZealandMexico Iceland

FinlandGreece

Czech Republic IrelandPolandKorea

SwedenHungary Spain

Norway

BelgiumAustralia

Italy IsraelTotal OECDUnited States

DenmarkCanada

NetherlandsGermanyEuropean Union

United KingdomFrance

Japan

Slovak Republic-10

-5

0

5

10

15

20

-10 -5 0 5 10 15 20

Total R&D Expenditures

Pu

blic

R&

D E

xp

en

dit

ure

s

Growth of Public and Private expenditure on R&D OECD, S&T databases, October 2001

European UnionTotal OECD

United States

United Kingdom

Turkey

Sw edenSpain

Slovak Republic

Portugal

Poland

Norw ay

New Zealand

Netherlands

Mexico

Korea

Japan

Italy

IrelandIceland

Hungary

Greece

Germany

France

Finland

Denmark

Czech Republic

Canada

Belgium

Australia

-10

-5

0

5

10

15

20

25

30

-10 -5 0 5 10 15 20 25 30

Private R&D expenditures

Pu

blic

R&

D e

xp

en

dit

ure

s

Percentagem de PMEs que executam I&D no sector privado com financiamento público, no último ano disponível

8.8

9.0

9.0

10.2

11.4

15.1

24.5

28.6

29.8

48.6

53.5

56.9

57.8

60.1

70.6

0.0 10.0 20.0 30.0 40.0 50.0 60.0 70.0 80.0

Japão

França

EUA

Reino Unido

Alemanha

Europa 15

Itália

Áustria

Holanda

Dinamarca

Espanha

Finlândia

Irlanda

Portugal

Grécia

Notas: JP, I, E, FIN, P:2000; A: 1998; IRL: 1997; Todos os outros países e UE: 1999; A média Europeia não inclui a Bélgica, Luxemburgo e Suécia; Os dados da Irlanda só se referem a PMEs independentes.


Crescimento médio anual da percentagem de PMEs que executam I&D no sector privado com financiamento público, de 1995 até ao último ano

disponível

-9.3-8.8

-3.1-2.1

-0.9-0.6

3.23.5

11.112.2

13.724.7

30.531.9

-15.0 -10.0 -5.0 0.0 5.0 10.0 15.0 20.0 25.0 30.0 35.0

GréciaReino UnidoAlemanhaEspanhaFrançaHolandaJapãoEuropa 15IrlandaEUAFinlândiaItáliaPortugalDinamarca

Notas: JP, I, Fin, P: 1995-2000;E:1999-2000; IRL:1995-1997; D, DK, UE, EUA:1997-1999; Todos os outros países:1995-1999; A média da UE não inclui a Bélgica, Espanha, Irlanda, Luxemburgo, Áustria e Suécia.


Characterizing efficiency:• Scientific Production

• Technological capacity

• ...

Absolute R&D Expenditures and Scientific Production (1997).OECD (2000)

US

JapanGermany

France

UK

Italy

Spain

The Netherlands

SwedenBelgium

Finland

Denmark

Austria

Ireland

Portugal

Greece

100

1,000

10,000

100,000

1,000,000

100.00 1,000.00 10,000.00 100,000.00 1,000,000.00

Total Expenditure in R&D ($PPP; logarithmic scale)

Nu

mb

er

of

Art

icle

s P

ub

lish

ed

in

1995 (

log

ari

thm

ic s

cale

)

Technological Capacity ( PATENTS / GDP) 1996

Source: OST, 1998Source: OST, 1998

> 200

100 - 200

50 - 100

15 - 50

< 15

> 200

100 - 200

50 - 100

15 - 50

< 15

Média UE = 100Média UE = 100

Scientific Capacity (PUBLICATIONS / GNP) 1996

Source: OST, 1998Source: OST, 1998

> 200

100 - 200

50 - 100

15 - 50

< 15

> 200

100 - 200

50 - 100

15 - 50

< 15

Média UE = 100Média UE = 100

Technological CapacityTechnological Capacity

0.00 0.10 0.20 0.30 0.40 0.50 0.60Patents/R&D spending by com panies (m illion PPS, 1987 prices)

0

2

4

6

8

10

12

Pu

blic

atio

ns/

no

n-B

ER

D(m

illio

n S

PP

, 198

7 p

rice

s)

GR

PT

ES

FR IT

BE

SE

UK DK

EU

ADE

FI USNL

JP

IRL

source: Caracostas & Muldur (1998)

Scientific “Productivity” and inter-institutional cooperationEC Benchmark of S&T Policies, September 2001

Innovation : Innovation :

What do we know?What do we know? What would we like to know?What would we like to know?

The Imperative: improve productivity and efficiency,

not the extension with which resources are used

G7

Euro Area

América do Norte

Portugal

Grécia

Hungria

Nova Zelândia

Japão

Islândia

AustráliaEspanha

Canadá

Finlândia

Reino Unido

Suécia

Suiça

Irlanda

Dinamarca

Alemanha

Áustria

Holanda

EUA

Itália

França

Noruega

Luxemburgo

-20

-15

-10

-5

0

5

10

15

20

-50 -40 -30 -20 -10 0 10 20 30 40 50

Diferença da Produtividade Horária Face à Média Comunitária

Efe

ito

do

Nú

me

ro d

e H

ora

s d

e T

rab

alh

o

Produtividade horária menor que a média EU-15Menos horas de trabalho do que a média EU-15

Produtividade horária maior que a média EU-15Menos horas de trabalho do que a média EU-15

Produtividade horária maior que a média EU-15Mais horas de trabalho do que a média EU-15

Produtividade horária menor que a média EU-15Mais horas de trabalho do que a média EU-15

Contributions of Hourly Productivity and of Hours Worked to the “Gap” in GDP per Capita (1998)

How to increase productivity? There is a need to enhance innovation.

Why? Because Portugal is already competitive in low value-added activities.

0% 20% 40% 60% 80% 100%

EU

OCDE

Polónia

República Checa

Turquia

Grécia

Espanha

Portugal

Hungria

México

Noruega

Bélgica/Luxemburgo

Finlândia

Itália

Coreia

Nova Zelândia

Holanda

França

Reino Unido

Canada

Austria

Dinamarca

Suécia

Alemanha

Japão

Irlanda

EUA

Austrália

Suiça

Percentagem das Exportações para a União Europeia (1996)

Alto Valor

Médio Valor

Baixo Valor

Proportion of Exports According to the Price/Quality Ratio (Value) of Exported Goods (EUROSTAT)

What is lacking to enhance productivity? a) R&D investment, namely by firms

Reino Unido

Turquia

Suiça

Suécia

Espanha

Portugal

PolóniaNoruega

Holanda

Itália

Irlanda

Hungria

Grécia

Alemanha

França

Finlândia

Dinamarca

República Checa

Bélgica

Nova Zelândia

Coreia Japão

Austrália

EUA

México

Canada

R2 = 0.7(exceptuando Irlanda e México)

0

5

10

15

20

25

30

35

40

45

50

0 0.5 1 1.5 2 2.5 3 3.5 4Intensidade em I&D na Indústria

(Despesa em I&D na Indústria/Produção Industrial)

Es

pe

cia

liza

çã

o d

as

Ex

po

rta

çõ

es

em

Se

cto

res

de

Alt

a T

ec

no

log

ia(E

xpo

rta

çõe

s e

m A

lta T

ecn

olo

gia

/To

tal d

e E

xpo

rta

çõe

s)

High Tech Exports and R&D Intensity in Firms (OCDE,2002)

1.6%

1.8%

2.2%

2.7%

3.2%

3.3%

3.5%

3.8%

3.9%

4.1%

4.3%

7.0%

0.7%

1.2%

2.5%

4.0%

2.1%

3.0%

1.6%

1.3%

3.0%

2.4%

3.8%

Portugal

Espanha

Bélgica

Noruega

Reino Unido

Irlanda

Áustria

Holanda

França

Alemanha

Finlândia

Suécia

Indústria Serviços

Firm Revenues Invested in Activities Oriented towards Innovation

What is lacking to enhance productivity? b) expenditure on innovation

c) Portugal also lacks technical skills and competencies

What is lacking to enhance productivity?

Highest Level of Education Attained: Population of 25-64 Years Old (2001)(Source: OECD, Education at a Glance 2002)

0 10 20 30 40 50 60 70 80 90

Portugal

Turkey

Spain

Italy

Greece

Luxemburg

Belgium

Ireland

Netherlands

France

Hungary

Austria

Finland

Germany

Poland

Denmark

Sweden

Norway

UK

Slovakia

Czech Republic

US

Upper Secondary Education Terciary Education


d) Portugal is behind in organizational, as much as in technological, innovation

Rotação dos Trabalhadores

Organização do Trabalho em

Equipas

Maior Envolvimento dos Trabalhadores menos Qualificados

Horizontalização das Estrutura de

Gestão

Alemanha 7 20 19 30Dinamarca 28 40 10 42Espanha 14 34 33 -França 6 30 44 21Holanda 9 9 46 47Irlanda 10 27 32 23Itália 13 28 24 10Portugal 9 22 9 3Reino Unido 13 33 48 45Suécia 38 29 60 46Média (não ponderada) 15 27 33 29

Adoption of Flexible Management Practices OCDE (1999). Employment Outlook


Market Regulation and Employment ProtectionNicoletti, Scarpetta & Boylaud; OECD (2000)

What does Portugal have going for it?

200 220 240 260 280 300 320

Chile

Portugal

Polónia

Eslovénia

Irlanda

Reino Unido

Hungria

Nova Zelândia

EUA

Austrália

Canadá

Bélgica

Finlândia

Holanda

Alemanha

Noruega

República Checa

Dinamarca

Suécia

Resultados Médios, População entre 16 e 65 Anos, 1994-1998 (Escala de 0 a 500)

Quantitativa

Leitura

Escrita

a) Portugal is now a dual country: excellence coexists with poor performance

200 220 240 260 280 300 320 340

Chile

Hungria

Polónia

EUA

Eslovénia

Irlanda

Nova Zelândia

Reino Unido

Austrália

Canadá

República Checa

Dinamarca

Bélgica

Noruega

Alemanha

Portugal

Holanda

Suécia

Finlândia

Resultados Médios, População entre 20 e 25 Anos com Educação Secundária Avançada Concluída, 1992-1998 (Escala de 0 a 500)

Written Literacy: Results for Population between 20 and 25

Years with Advanced High School Diplomas

Literacy: Results for the Entire Population

b) Portugal has been growing fast, but less so than other “catching-up” countries


Canada

México

EUA

AustráliaJapão

Coreia

Nova Zelândia

Austria Bélgica

Dinamarca

Finlândia

FrançaAlemanha

Grécia

Hungria

Irlanda

Itália

HolandaNoruegaPolónia

PortugalEspanha

Suécia

Suiça

Turquia

Reino Unido

EU

OCDE

0

5

10

15

20

25

30

-10 -5 0 5 10 15 20 25 30

Taxa Média de Crescimento Anual de Patentes Submetidas ao EPO (1990-1996)

Ta

xa

Mé

dia

de

Cre

sc

ime

nto

An

ua

l d

e A

rtig

os

Cie

ntí

fic

os

Pu

bli

ca

do

s

(19

90

-19

95

)

Variation in the Number of Patents and Number of Published Scientific Articles


c) Portugal has a new wealth in incoming people

-50.0% 0.0% 50.0% 100.0% 150.0% 200.0% 250.0% 300.0% 350.0%

EU

OCDE

França

Australia

Bélgica

Holanda

Canada

Suécia

Noruega

Reino Unido

Alemanha

EUA

Irlanda

Suiça

Luxemburgo

Japão

Espanha

Dinamarca

Portugal

Itália

Austria

Finlândia

Crescimento da Proporção da População Estrangeira (1988-1998)

Growth in the Population of Each Country with Foreign Origin (1988-1998), OECD(2000)

Average Annual Real Value Added Growth of knowledge Based Industries

OECD(2000)OECD(2000)

UK*

Belgium

Portugal**

Greece*

Sweden***

NL*Austria

Japan

Norway

Canada

Denmark

Spain***

Denmark

Mexico

ItalyUS

France

Korea

Germany

0

2

4

6

8

10

12

14

0 10 20 30 40 50 60

Share in Business Sector Value Added of Knowledge Based Industries (share year 1996 except: *1995;**1993; ***1994)

Ave

rag

e A

nn

ual

Rea

l V

alu

e A

dd

ed G

row

th

of

Kn

ow

led

ge

Bas

ed I

nd

ust

ries

(19

85-s

har

e ye

ar)

Balanço tecnológico de pagamentos como percentagem do PIB, para o ano mais recente

0.030.080.11

0.190.21

0.270.370.39

0.701.281.29

2.47

0.00 0.50 1.00 1.50 2.00 2.50

EspanhaFinlândia

ItáliaFrançaJapão

Portugal

Reino UnidoEUA

AlemanhaHolandaÁustriaBélgica

Notas: E, FIN: 1998; F, EUA:1999; Todos os outros países: 2000.Fonte: European Commission, Key Figures 2002 – Science, Technology and Innovation

Crescimento médio anual das receitas da balança de pagamentos em tecnologia para os anos mais recentes

-0.472.80

6.8010.70

11.9012.5013.0013.7014.40

15.8029.20

38.00

-5.00 5.00 15.00 25.00 35.00 45.00

ItáliaEUAReino UnidoFrançaAlemanhaÁustriaHolandaPortugalJapãoBélgicaFinlândiaEspanha

Notas: Valores calculados em PPS a preços de 1995; E, FIN: 1995-1998; EUA, F: 1995-1999; P, UK: 1996-2000; Todos os outros países: 1995-2000


In the way of a summary.......

There may be agreement on some general and generic areas for investment (education, science and technology, infrastructures, “social capital” defined in a broad way). But the design and implementation of specific policies meets two challenges:– The lack of understanding of the barriers and opportunities – A lack of qualified people able to understand and interpret

the developmental shortcomings of the country and of designing and implementing, at the firm level or in the public sector, the measures that could overcome these shortcomings.

Portugal needs to jump from a “catching-up” model of economic growth and development, to a model of “forging-ahead” by exploring creativity and ingeniousness by developing and diffusing innovation.

Main indicators from innovation surveys

• Number of innovating firms–by sector

–by firm size

• Cost of innovation

• Percentage of sales due to new products

The Community Innovation Survey, CISThe Community Innovation Survey, CIS

The Community Innovation Survey (CIS)The harmonised EU/OECD questionnaire

• General information about the firm

• Type of innovation (product, process)

• Sources of information for innovation

• Objectives of innovation

• Factors hampering innovation

• Cost of innovation

• Impact of innovation

Survey SampleSurvey Sample• Initial Sample: Initial Sample: 47274727 firms stratified by firm size and sector firms stratified by firm size and sector

(INE–1999 Data)(INE–1999 Data)

• Corrected sample: Corrected sample: 41274127 firms firms

Sectors SurveyedSectors Surveyed• Mining and Quarrying, all Manufacturing, Utilities, Wholesale Mining and Quarrying, all Manufacturing, Utilities, Wholesale

Trade and a selection of industries in the Service SectorTrade and a selection of industries in the Service Sector

Survey Target PopulationSurvey Target PopulationAll Manufacturing and Service firms with more than 10 employeesAll Manufacturing and Service firms with more than 10 employees

The Third Community innovation Survey: CIS 3The Third Community innovation Survey: CIS 3Application to PortugalApplication to Portugal

Innovation Defined as: Innovation Defined as: Market introductionMarket introduction of a product (Good or Service) of a product (Good or Service) new or significantly improvednew or significantly improved, or the introduction of new or significantly , or the introduction of new or significantly improved processes, based on new technological developments, new improved processes, based on new technological developments, new combinations of existing technologies or on the use of other type of knowledge combinations of existing technologies or on the use of other type of knowledge acquired.acquired.

• Harmonized questionnaire (the same for Services and Manufacturing and other Harmonized questionnaire (the same for Services and Manufacturing and other industries)industries)

• Questions regarding:Questions regarding:

General InformationGeneral Information

Basic Economic InformationBasic Economic InformationProduct and Process InnovationProduct and Process InnovationPatents and Other Protection MethodsPatents and Other Protection Methods

Innovation Activities and ExpenditureInnovation Activities and ExpenditureIntramural R & DIntramural R & DOther Strategic and Organizational Important ChangesOther Strategic and Organizational Important Changes

Effects of InnovationEffects of InnovationPublic FundingPublic FundingInnovation Co-operationInnovation Co-operationSources of Information for InnovationSources of Information for InnovationHampered Innovation ActivityHampered Innovation Activity

Companies Characteristics

Innovation Extension

Companies Options

Systemic Characteristics

The Third Community innovation SurveyThe Third Community innovation Survey QuestionnaireQuestionnaire

Ireland

Austria

Germany

Netherlands

UK

Sweden

Norway

France

Luxemburg

Belgium

0%

20%

40%

60%

80%

100%

20% 40% 60% 80% 100%

Proportion of Manufacturing Innovating Enterprises

Proportion of Service

Innovating Enterprises

PortugalItaly

(1) For comparison with the data of 1995-1997 some Sub sectors (NACE 63, 73, 74.3 e 64 except 64.2) and the manufacturing companies in between 10 and 20 employees which were part of the CIS 3 survey are not considered

(2) Includes the results not considered in (1).Note: Final disaggregated and comparable results are not yet available for the other

participants in the exercise.

(1)(2)

CIS III(Preliminary)

CIS II

Finland

ConvergenceConvergenceLeading the Convergence towards the EU MeanLeading the Convergence towards the EU Mean

Ireland

GermanyAustria

NetherlandsUK

Sweden

NorwayFrance

Finland

BelgiumPortugal

0%

20%

40%

60%

80%

0.0% 2.0% 4.0% 6.0% 8.0%

Expenditure in Innovating Activities as Share of Turnover

Po

rpo

rtio

n o

f In

no

va

tiv

e E

nte

rpri

se

s

Manufacturing Sector

CIS III(Preliminary)

CIS II

Convergence: Convergence: Input vs OutputInput vs Output

Or Or

Is there evidence of qualitative Is there evidence of qualitative changes as well?changes as well?

Purely quantitative vs. qualitative convergencePurely quantitative vs. qualitative convergence

Do results indicate latecomer growth?Do results indicate latecomer growth?

Do qualitative weaknesses remain?Do qualitative weaknesses remain?

Questions to be raised:

Evidence Supporting Qualitative ChangeEvidence Supporting Qualitative Change ME’s Catching UpME’s Catching Up

0

10

20

30

40

50

60

70

80

90

1995-1997 1998-2000(1)

1998-2000(2)

1995-1997 1998-2000(1)

1998-2000(2)

1995-1997 1998-2000(1)

1998-2000(2)

Manufacturing Services National (3)

Prop

ortio

n of

Inno

vatin

g En

terp

rises

(%)

Small Medium Large Manufaturing Total Services Total National Total

0102030405060708090

100C

oke

an

dC

he

mic

als

Ma

chin

ery

an

dE

qu

ipm

en

t

Tra

nsp

ort

Eq

uip

me

nt

Ele

ctri

cal a

nd

Op

tica

lE

qu

ipm

en

tB

asi

c M

eta

lsa

nd

Fa

bri

cate

dR

ub

be

r a

nd

Oth

er

No

n-

Me

talli

cM

an

ufa

ctu

rin

gN

EC

an

dR

ecy

clin

gF

oo

dp

rod

uct

s;B

eve

rag

es

Wo

od

, Pu

lpa

nd

Pu

blis

hin

g

Te

xtile

s a

nd

Le

ath

er

High and Medium-High Medium-Low Low

Technological Sectors (CIS II)

Pro

po

rtio

n o

f In

no

vatin

g E

nte

rpri

ses

(%)

0102030405060708090

100C

oke

an

dC

he

mic

als

Ma

chin

ery

an

dE

qu

ipm

en

t

Tra

nsp

ort

Eq

uip

me

nt

Ele

ctri

cal a

nd

Op

tica

lE

qu

ipm

en

tB

asi

c M

eta

lsa

nd

Fa

bri

cate

dR

ub

be

r a

nd

Oth

er

No

n-

Me

talli

cM

an

ufa

ctu

rin

gN

EC

an

dR

ecy

clin

gF

oo

dp

rod

uct

s;B

eve

rag

es

Wo

od

, Pu

lpa

nd

Pu

blis

hin

g

Te

xtile

s a

nd

Le

ath

er


Technological Sectors (EVCISII)

Pro

po

rtio

n o

f In

no

vatin

g E

nte

rpri

ses

(%)

0102030405060708090

100C

oke

an

dC

he

mic

als

Ma

chin

ery

an

dE

qu

ipm

en

t

Tra

nsp

ort

Eq

uip

me

nt

Ele

ctri

cal a

nd

Op

tica

lE

qu

ipm

en

tB

asi

c M

eta

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nd

Fa

bri

cate

dR

ub

be

r a

nd

Oth

er

No

n-

Me

talli

cM

an

ufa

ctu

rin

gN

EC

an

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ecy

clin

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oo

dp

rod

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s;B

eve

rag

es

Wo

od

, Pu

lpa

nd

Pu

blis

hin

g

Te

xtile

s a

nd

Le

ath

er


Technological Sectors (CIS III)

Pro

po

rtio

n o

f In

no

vatin

g E

nte

rpri

ses

(%)

Evidence Supporting Qualitative ChangeEvidence Supporting Qualitative Change

Innovation pervades the economyInnovation pervades the economy

Note: Note: Less confined to the Technologically advanced sectorsLess confined to the Technologically advanced sectors

Evidence Supporting Qualitative ChangeEvidence Supporting Qualitative Change

Shift of innovation expenditure toward intangibles: services sectorShift of innovation expenditure toward intangibles: services sector

However, weak However, weak and ambiguous in and ambiguous in

the the manufacturing manufacturing

firms - decrease firms - decrease in marketing & in marketing & training, rise in training, rise in

R&D…R&D…

0% 10% 20% 30% 40% 50% 60% 70% 80%

Acquisition of Machineryand Equipment

Design, Training andMarketing

Intramural R&D

Extramural R&D

Acquisition of otherExternal Knowledge

Proportion of Total Innovation Expenditures in 2000 (%)

1998-2000 1995-1997

Manufacturing

(E

xpe

nd

iture

s)

0% 10% 20% 30% 40% 50% 60% 70% 80%

Acquisition of Machineryand Equipment

Design, Training andMarketing

Intramural R&D

Extramural R&D

Acquisition of otherExternal Knowledge

Proportion of the Total Innovation Expenditure (%)

1998-2000 1995-1997

(E

xpe

nd

iture

s)

Services

Evidence Supporting Qualitative ChangeEvidence Supporting Qualitative Change… … consistent with the rise of BERD since 1997, still quite low by EU standards…consistent with the rise of BERD since 1997, still quite low by EU standards…

(Source: R&D Survey, IPCTN, 2002)(Source: R&D Survey, IPCTN, 2002)

Business Expenditure in R&D and average growth rates, 1992-2001

0

10000

20000

30000

40000

50000

60000

1992 1995 1997 1999 2001

Millio

n P

TE

-5%

0%

5%

10%

15%

20%

25%

30%

Gro

wth

ra

te

BERD at constant 1995 prices

Annual growth rates

Evidence Supporting Qualitative ChangeEvidence Supporting Qualitative Change… … and with the observed correlation between technological and other innovationsand with the observed correlation between technological and other innovations

-

10.0

20.0

30.0

40.0

50.0

60.0

70.0

Cha

ngin

gE

nte

rpris

e's

Ma

rke

ting

Con

cep

ts/S

trat

egi

es

Adv

ance

dM

ana

gem

ent

Tech

niqu

es

Sig

nific

ant

Ae

sthe

tics'

Cha

nge

Ne

w C

orp

orat

eS

trate

gie

s

Cha

nge

dO

rga

niza

tion

alS

truc

ture

s

Cha

ngi

ng

Ent

erp

rise'

sM

arke

ting

Co

ncep

ts/S

trate

gie

s

Ad

vanc

edM

ana

gem

ent

Tech

niq

ues

Sig

nifi

cant

Aes

thet

ics'

Cha

nge

New

Cor

pora

teS

trate

gies

Ch

ang

edO

rgan

izat

iona

lS

truct

ure

s

Non-Innovators Innovators

Pro

porti

on

of E

nte

rpri

ses

(%)

Manufacturing Services

Evidence Supporting persistent structural Evidence Supporting persistent structural weaknessesweaknesses

Industrial structure skewed to very small and small enterprises...Industrial structure skewed to very small and small enterprises...

CIS III population by size

0%

20%

40%

60%

80%

100%

Manufacture Services All

Small

Medium

Large


… … which are much less prone to innovate…which are much less prone to innovate…

CIS III

0

10

20

30

40

50

60

70

80

90

100

Manufacturing Services NationalPro

porti

on o

f Inn

ovat

ing

Ent

erpr

ises

(%)

10 to 19 20 to 49 50 to 99 100 to 249 250 to 499 More than 500 employees


… … and to middle-low and low technology sectors…and to middle-low and low technology sectors…

CIS III population by Technological Intensity

0%

20%

40%

60%

80%

High andMedium-HighTechnologies

Medium-LowTechnologies

LowTechnologies


… … also less innovativealso less innovative

0

10

20

30

40

50

60

70

80

90

100

Small Medium Large

Enterprise Dimension

Pro

po

rtio

n o

f In

no

vativ

e E

nte

rpri

ses

(%)

Low Medium-Low High and Medium-High Technological Sectors


Limited market scopeLimited market scope

Main market scope of innovative enterprises

0%

20%

40%

60%

80%

100%

Manufacture Services Total

International

National

Local

• The restriction of most firms' targets to the national and local markets sets The restriction of most firms' targets to the national and local markets sets lower innovative challenges;lower innovative challenges;• It also accounts for the unusually high percentage of products "new to the It also accounts for the unusually high percentage of products "new to the market“, especially of servicesmarket“, especially of services


Protection MethodsProtection Methods

• Protection of innovation, though mainly developed in house and new to the market, Protection of innovation, though mainly developed in house and new to the market, relies heavily on informal procedures (secrecy, complexity of design, time-to-market)relies heavily on informal procedures (secrecy, complexity of design, time-to-market)

• This also helps to explain the persistence of a low use of formal IPR (patents, This also helps to explain the persistence of a low use of formal IPR (patents, registration of design patterns, copyright): The only exception is trademarks.registration of design patterns, copyright): The only exception is trademarks.

0.0

5.0

10.0

15.0

20.0

25.0

30.0

Non

-In

nova

tors

Inno

vato

rs

Non

-In

nova

tors

Inno

vato

rs

Non

-In

nova

tors

Inno

vato

rsManufacturing Services National

Pro

port

ion

of E

nter

pris

es P

rote

ctin

g In

nova

tions

(%

)

At least one Formal Method At least one Informal Method

Patent Applications

-

200

400

600

800

1,000

1,200

1,400

Non

-In

nova

tors

Inno

vato

rs

Non

-In

nova

tors

Inno

vato

rs

Non

-In

nova

tors

Inno

vato

rs

Manufacturing Services NationalN

umbe

r of

Pat

ent A

pplic

atio

ns


The relatively low academic qualification of the labor force persists, The relatively low academic qualification of the labor force persists, especially in the manufacturing sectorespecially in the manufacturing sector

This is all the more important as there is a significant difference This is all the more important as there is a significant difference in in

qualification between innovative and non-innovative firmsqualification between innovative and non-innovative firms

Workforce with tertiary education

0%

5%

10%

15%

20%

25%

Manufacture Services Total

Non-innovative Innovative


As in CIS II, firms' perception of the obstacles hindering innovation As in CIS II, firms' perception of the obstacles hindering innovation contrasts with that of EUcontrasts with that of EU

0

5

10

15

20

25

30

35

40

45

50

Qua

lifie

dP

erso

nnel

Org

anis

atio

nal

Rig

iditi

es

Inno

vatio

n C

osts

Sou

rces

of

Fin

ance

Info

rmat

ion

onT

echn

olog

y

Eco

nom

ic R

isks

Info

rmat

ion

onM

arke

ts

Reg

ulat

ions

and

Sta

ndar

ds

Cus

tom

erR

espo

nsiv

enes

s

Pro

porti

on o

f Ent

erpr

ises

(%)

CIS III CIS II CIS II EU Average


• Firms tend not to consider, and even less than in Firms tend not to consider, and even less than in

CIS II, organizational rigidities and lack of qualified CIS II, organizational rigidities and lack of qualified

personnel as barriers.personnel as barriers.

• Firms overemphasize obstacles beyond their control Firms overemphasize obstacles beyond their control (finance, costs, risk) and underemphasize those they (finance, costs, risk) and underemphasize those they can influence.can influence.

• But both qualification of personnel and organizational But both qualification of personnel and organizational

change are in fact associated to innovative firms, and change are in fact associated to innovative firms, and

Portugal has comparatively under-qualified workforcePortugal has comparatively under-qualified workforce

• The The innovative performance of Portuguese firms has innovative performance of Portuguese firms has improvedimproved over the second half of the 1990s, as far as one can over the second half of the 1990s, as far as one can learn from self-reported indicators.learn from self-reported indicators.

Innovation:Innovation: What do we know?What do we know?

• Technological innovation appears to be strongly correlated Technological innovation appears to be strongly correlated withwith Organizational Innovation and Change Organizational Innovation and Change -- there may be there may be limited value-added and returns in looking at technological or limited value-added and returns in looking at technological or organizational innovation per se.organizational innovation per se.

• Important structural weaknesses remainImportant structural weaknesses remain – both – both associated with factors external to the firms and with firm associated with factors external to the firms and with firm behavior, with firms attributing more importance to the former behavior, with firms attributing more importance to the former when asked to indicate barriers to innovationwhen asked to indicate barriers to innovation

• The enhancement in innovative performance has been The enhancement in innovative performance has been accompanied by limited, but significant, accompanied by limited, but significant, structural changesstructural changes – – that is, the improvement in performance goes beyond that is, the improvement in performance goes beyond catching-up dynamics. catching-up dynamics.

• What would the characterization of innovation in Portugal What would the characterization of innovation in Portugal would be like based, instead of self-reported indicators, on would be like based, instead of self-reported indicators, on “independent” assessments“independent” assessments? More specifically, what should ? More specifically, what should we learn, compare, typify and seek to explain about we learn, compare, typify and seek to explain about innovative processesinnovative processes as a whole? as a whole?

• What has the What has the impact of policiesimpact of policies been on the innovation been on the innovation performance of firms? When has it been positive, negative, performance of firms? When has it been positive, negative, redundant (that is, crowding-out what firms would do anyway redundant (that is, crowding-out what firms would do anyway as a response to changing market dynamics). as a response to changing market dynamics).

• What explains the What explains the correlation between technological and correlation between technological and other types of innovationother types of innovation? What are the ? What are the organizational organizational adjustment and learning costs to innovationadjustment and learning costs to innovation and how can and how can they be minimized? Which are the they be minimized? Which are the organizational organizational opportunitiesopportunities and how can they be optimized? and how can they be optimized?

Innovation:Innovation: What would we like to know?What would we like to know?

Innovation:Innovation: What would we like to know?What would we like to know?

• What is generic, and what is specific, to the (still weak) innovative performance of the Portuguese firms? From what we would know to be generic, which lessons from other contexts could we apply in Portugal? From the specificity, what would constitute adequate responses?

• How important is innovation to enhance the welfare of Portugal? What alternatives to “becoming more innovative” would be available to meet the challenge of reaching the European average economic performance?

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