12-13_curs MTT Transfer Technology 10122012

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MTTManagementul transferului de

tehnologieMasterat - Managementul afacerilor prin

proiecte

20122013Semestrul I

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Cuprins

Barometrul inovatiei

Research and innovation at the heart of business

Transfer of technology

World BankWorld Development IndicatorsScience &

Technology

The most innovative countries

Indexing Global Innovation

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Barometrul inovatiei: Liderii de opinie din Bruxelles cred cainovatia duce la o economie mai competitiva si mai verde

"Barometrului inovatiei GE", 2010 constatari cheie:- 90% dintre participantii la studiu cred ca inovatia este principalul factor in crearea unei economii mai competitive

si ecologice.- 86% considera ca investitiile in inovatie reprezinta cea mai buna modalitate de creare a noi locuri de munca in UE.

- 91% dintre participantii la studiu si-ar dori ca UE sa foloseasca fondurile structurale pentru accelerarea procesuluide adoptare a produselor si serviciilor inovatoare.- 78% cred ca industria energetica ar putea fi sectorul care creeaza cele mai multe locuri de munca daca ar fi

sprijinita printr-o politica imbunatatita privind inovatia; sectorul medical s-ar situa pe locul al doilea, conformunui procent de 66%, iar telecomunicatiile pe locul al treilea, cu 57%.

- 83% dintre participantii la studiu considera ca parteneriatul public-privat este esential pentru construirea uneiEurope mai inovatoare.

- Numai 41% dintre participantii la studiu considera ca sistemele IP (proprietate intelectuala) actuale permitdezvoltarea inovatiei in UE.

- De asemenea, s-a constatat existenta unui sprijin puternic privind crearea unui brevet UE unic.- Dincolo de cresterea economica, se considera ca inovatia dispune de potentialul necesar pentru a permite

imbunatatirea mai multor dimensiuni ale vietii cetatenilor Uniunii Europene, in special in ceea ce privestelocurile de munca, calitatea mediului si sanatatea.

Barometrul inovatiei a analizat barierele si mecanismele identificate in legatura cu crearea unei UniuniInovatoare prospere. Conform unei majoritati coplesitoare a respondentilor, sunt necesare mai multe

parteneriate public-private, o mai mare consecventa la nivelul politicilor si stimulentelor din statele membre,precum si abordarea birocratiei la toate nivelurile. Cu toate acestea, cel mai important aspect evidentiat a fostnevoia de schimbare a proceselor pentru a permite sectorului privat sa acceseze fondurile structurale.

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Research and innovation at the heart of business

When placed at the heart of business, research and innovation become motors of wealth generation and growth. It is also widelyobserved that the innovation performance of enterprises is reinforced when they form clusters and networks. Public policycannot create clusters, but public funding can strengthen them. For the EUs science base to strengthen its industrial base, co-operation between public research and industry should improve considerably.

More emphasis is needed on sectoral needs in formulating research and innovation policies, together with improved business supportservices to foster technology take-up and entrepreneurial innovation, in particular to help SMEs overcome their specific

problems and participate in European networks.

1. Intensified university-industry partnerships. Sub-optimal research collaboration and knowledge transferbetween Public Research Organisations (PROs), particularly universities, and industry are one of theweaknesses of the European research and innovation system.

EU define guidelines to improve research collaboration and knowledge transfer between PROs andindustry which Member States and stakeholders will be encouraged to implement on a voluntary and flexible

basis. These guidelines will build on existing good practice (by both Member States and stakeholders) suchas the Responsible Partnering Initiative launched by several European industrial and academic associations

2. Innovation poles and research-driven and industrial clusters The EU has many dynamic industrial clusters, albeit smaller and less integrated than in the USA. Research and

innovation therefore suffer from the same fragmentation as the internal market. To make them as attractive as

possible to foreign investors, these innovation poles and clusters need to achieve critical mass. They cannotbe built from scratch, but depend on a strong industrial base and good and trustful relations between scienceand industry.

Networking within clusters and across complementary clusters is a key factor for their successfuldevelopment. Training and research centres, financial institutions, innovation and intellectual propertyconsultants, local and regional development agencies and other support organisations are all key players inmaximising firms creative business potential. The ever increasing complexity of products and processes andthe need to integrate services such as maintenance, logistics and marketing raise problems, even for the mostsuccessful clusters. Co-operation between clusters can help to address them.

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Research and innovation at the

heart of business3. Pro-active business support services to stimulate research and innovation. SMEs play a major role in the

European Unions business economy, accounting for approximately 66% of private employment and 57% ofvalue added in EU25. However, many face size-related problems, in particular when it comes to innovation,access to information, networking and partner-finding. Public authorities should address the relevant marketfailures by facilitating dissemination of technology to SMEs and strengthening their capacity to develop,

acquire, adapt and use new technologies.EU innovation policy therefore facilitates transnational technology transfer (TTT) between firms andencourages them to bring innovations to market, in particular through the network of Innovation RelayCentres, which fill a market gap by providing a regional gateway to European co-operation and combininggrass-roots knowledge with Europe-wide expertise and contacts.

4. Innovation management and social change. Innovation management is a prerequisite for innovation toflourish in firms. Many enterprises, especially SMEs, encounter difficulties in planning, implementing andmarketing innovative products and in innovating in their production processes. Innovation cannot workwithout taking people into account. Therefore, in addition to the specific research skills and researcher

career issues, further education and training is essential to keep Europes human capital up to date with theskills and knowledge necessary for innovation. This includes entrepreneurial skills and the readiness totake risks.

Enterprises of all sizes should be more flexible in responding to rapid changes in demand, adapt to newtechnologies, such as ICT and e-business, and be able to innovate constantly in order to remain competitive.To this end, innovative working practices are to be promoted and disseminated, as stressed in the EuropeanEmployment Strategy. Innovation requires investing in people and skills. Commitment to innovation andresearch is also a manifestation of corporate social responsibility (CSR).

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Technological progress in developing countries

= improvement in the ways that goods and services are produced, marketed, and brought tomarket

- plays a central role in spurring income growth and reducing poverty. In fact, it is at thevery heart of human progress and development.

- has narrowed the technology gap between rich and poor countries has narrowed, but thegap is still wide

reflects adoption of pre-existing technologies rather than at-the-frontier inventions

has been strongly driven by globalization (trade, FDI, contact with migrant populations)

is constrained by weak domestic capacity to absorb technology; issues include lowtechnical literacy

can be facilitated by appropriate policies

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Technological progress in developing countries- the heart of income growth, poverty reduction

The graph shows that technologicalprogress has gone hand-in-hand with

income growth in developing countriesover a recent 15-year period (1990 to 2005).

Rapid technological progress has reducedthe share of people living in absolutepoverty in developing countries from 29percent in 1990 to 18 percent in 2004.

Broadly, technological progress is whatmakes the difference between fast-growingdeveloping economies and slow-growingones. It also distinguishes economies thathave made great strides in reducingpoverty from those that have been lesssuccessful.

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Measuring technological progress

The most common measure of technological progress is growth in total factorproductivity (TFP). This is the relative efficiency with which an economy producesgoods and services given a certain quantity of labor and capital.

In TFP terms, technological progress since the early 1990s has been strongest in East

Asia, South Asia, and developing countries in Europe. It has been much weaker inLatin America, the Middle-East and Africa.

TFP is an indirect measure because it ascribes to technology all income growth

that cannot be explained by investment and increases in labor supply.

Measuring technology directly is difficult. Unlike pencils and pens, the physical

presence of technology cannot be easily counted.A World Bank report, Global Economic Prospects 2008: Technology Diffusion in theDeveloping World, goes beyond the common TFP measure to assess technologicalprogress more directly - by measuring the quantity and quality of inputs andoutputs.

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Measuring technological progress (2)

The World Bank has developed a summary index of technology that includes a muchwider range of indicators than included in other technology indexes. This index isderived from three sub indexes that measure four dimensions of technologicalachievement:

The extent of scientific invention and innovation

The diffusion of older technologies

The diffusion of newer technologies

The intensity with which foreign technologies are employed in domesticproduction.

According to these measures, technological progress in developing countries betweenthe 1990s and 2000s has been very strong. But the technology gap between richand poor countries remains large and developing countries capacity to absorbtechnology is still weak.

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The Technology Gap between Rich andPoor countries

While the level of technology used in all countries hasincreased rapidly, it has done so quicker indeveloping countries and quickest in low-incomecountries. (Of course, the initial level oftechnology in lower-income countries was much

lower to begin with.)There is strong evidence of catch-up between

middle-income and high-income countries.

Despite the rapid pace of technological progress, thetechnology gap between high-income and

developing countries remains wide, withdeveloping countries employing only a quarter of

the level of technology in developed countries.Levels of technological achievement in high-income

countries are more than twice those in upper-middle income countries. This group, in turn, haslevels of achievement that are more than doublethose in low-income countries.

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Technological achievementdigital divideTechnological achievement

- can also vary widely within a country.Main cities and leading sectors often usemore sophisticated technologies than therest of the economy.

- For example, the IT-enabled services sector in urbanIndia employs world-class technologies, but less than10 percent of the countrys rural households havetelephone access as of 2007. So, while one might haveexpected India to have better overall technologydiffusion than other countries at similar income levels,in fact, it does not.

Over time, the digital divide between rural

and urban

India is expected to narrow, especially in high-

income states and near major cities, but it maywell worsen in some areas. Another key findingof the report is that technological progress indeveloping countries almost universallyreflects adoption or adaptation of pre-existingtechnologies rather than at-the-frontierinventions. This is not the case in rich

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Technological achievementdigital divide

The graph shows that developing

countries are scarcely active at theglobal technological frontier.

This is mainly because many developingcountries lack the critical mass oftechnological competencies necessary toparticipate at the global technologyfrontier.

This does not mean that top-level scientistsdo not exist in these countries. Manypeople from developing countries performcutting-edge research in developedcountries.

In the United States, 2.5 of the 21.6 millionworking scientists and engineers were bornin developing countries (Kannankutty &Burelli, 2007).

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How have various pre-existing technologies spread in developingcountries? The picture is somewhat different for older technologiesthan it is for newer ones.

The major innovations of the past 200 years - such as steam power, electricity, and telephones -exist to some degree in virtually every country. But access to these older technologies varieswidely between countries, depending on both the technological absorptive capacity of thecountry and the affordability of the technology.

While countries of the former Soviet bloc enjoy near-universal access to electricity, in Sub-Saharan Africa, only 8 percent of the rural population has access to electricity, and just overhalf the urban population. Moreover, the quality and regularity of the service is low.

Some newer technologies such as mobile phones and broadband Internet have penetrateddeveloping countries much faster than older technologies.

The near-doubling ofmobile phone ownership in low-income countries between 2000 and 2004may be of great value too poor people in rural areas constrained by poor infrastructure. Forexample, Teba Bank in South Africa has developed a smart card that uses mobile phonetechnology to provide low-cost electronic banking services to low-income customers.

Internet bandwidth consumption and the number of broadband subscribers have more thandoubled from 1999 to 2004 in both middle- and low-income countries. But personalcomputersmore expensive than a shared Internet connection such as through an Internetcafhave spread more slowly. Three-quarters of low-income countries have 15 or fewer

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Technological progress

Technological progress can contribute to development in two broad ways:

By lowering costs, improving quality, creating new products, and helping reach newmarkets.

By using relatively simple skills for far-reaching development benefits.

For example, the simple skills needed to build rainwater collection systems can greatly improveaccess to clean drinking water and reduce the incidence of diarrhea, a major cause of infantmortality.

While technological progress can bring great benefits, it can also be disruptive when thesebenefits are not evenly distributed.

Technological progress may benefit some classes of workers over others. It can also meansignificant short-term losses for competitors who are still using older technologies. Butdisruptions caused by technological progress can benefit economies by spurring domesticcompetition. For example, the introduction of mobile phone technology in severaldeveloping countries has brought in significant competition not only in thetelecommunications sector but also in banking and other information-sensitive sectors.

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Constraints on developing countries capacityto absorb technology

Successful adoption and adaptation of foreign technologies depends on each

developing countrys capacity to absorb these technologies.

Overall, technological absorptive capacity in the developing world is still weak,

and needs to be strengthened.

According to a World Bank report, Global Economic Prospects 2008: TechnologyDiffusion in the Developing World, there has been considerable progress in themacroeconomic environment and financial structure and intermediation indeveloping countries - both critical for healthy technological absorption. But thecapacity of developing countries to absorb technologies has been largely limited

by: low technical literacy

the uneven spread of older technologies such as electricity and telephones

low penetration of technologies in rural areas.

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The quality of education

There has been significant progress indeveloping countries in literacyrates over the past 15

years. But too often, the qualityof education being delivered indeveloping countries remains low.

Large proportions of studentsofficially classified as literate inmiddle-income countries fail tomeet OECD literacy standards.

In Sub-Saharan Africa, despite enrollmentrates of close to 100 percent, fewerthan half of grade six students in somecountries are deemed literate.

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Capacity to absorb technology

For example, in India, telephonepenetration rates in urban centers are 8times those in rural regions. Within

sectors, the most productive firms tendto have productivity levels that arefive times those of the average firm.

This suggests that if their technologieswere adopted by other firms (and theirwork force had adequate skills), GDP

could be increased by between fourand five times.

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Capacity to absorb technologyWhile many countries have improved

technological achievement,relatively few countries haveimproved their technological

absorptive capacity by more than10 percent between 1990 and 2000.

The most negative score was by Zimbabwe, mainlyreflecting the recent deterioration inmacroeconomic and governance conditions.

Weak domestic absorptive capacity willprobably hinder future technologicalprogress in developing countries.

Unless steps are taken to raise basic

competencies and invest in localtechnology dissemination networks,many developing countries may notbe able to master anything but thesimplest of future technologies.

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Total factor productivity (TFP)

TFP was derived as the residual after accounting for the contribution of laborand capital to aggregate output.

It is well accepted in the economics literature that total factor productivitydepends on the availability of knowledge.

Romer (1986, 1990) and Lucas (1988) argued that TFP levels depend onthe stock of knowledge or human capital.

Grossman and Helpman (1imported goods embodied foreign technology andhence imports would lead to increases in TFP991) postulated that.Coe and Helpman (1995) found that for a sample of developed countries both

domestic and foreign R&D had significant impact on TFP.


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TFP is the main driver of long run productivitygrowth

examines the EU's productivity performance relative to the USover recent decades.

One of the key aims of the paper is to examine the role played bytotal factor productivity (TFP) in explaining the productivity

patterns which have emerged

Source:

The EU-US total factor productivity gap: An industry perspective,Karel Havik, Kieran Mc Morrow, Werner Rger and Alessandro

Turrini, European Commission, April 2008

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In advanced economies especially, productivitygrowth will moderate in 2011

http://www.conference-board.org/data/economydatabase/

The world economy returned to solid productivity growth in 2010 as GDP in mostcountries recovered strongly from the 2008/09 financial and economic crisis, whileemployment lagged behind. Advanced regions left recession firmly in the rearviewmirror. Emerging economies continue to drive both global growth and global

productivity growth.The U.S. economy remained on a higher productivity growth path than Europe in 2010, but their

productivity growth rates may converge, at least temporarily, in 2011 as U.S. employment picksup momentum. Global productivity growth will moderate slightly in 2011 as cyclical effectsabate.

Advanced economies saw solid labor-productivity growth in 2010 as they left recession firmly

behind. GDP bounced back strongly (from -3.3 percent in 2009 to 2.9 percent in 2010). The labormarket also recovered (employment growth was -2.2 percent in 2009, -0.1 percent in 2010) butlagged behind GDP growth. The combination of these two factors produced an above trendrecovery in labor productivity growth, which reached 3.0 percent in 2010.

In 2011, labor productivity growth in advanced countries is projected to decelerate to 1.6 percent, asthe result of a slowdown in output growth to 2.3 percent while employment growth begins tobuild momentum, growing at 0.7 percent.

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Total Factor Productivity trend continuesto weaken in advanced economies


Total Factor Productivity (TFP) growth, which captures major drivers of efficiencylike technological and managerial improvements, has accounted for roughly aquarter of total output growth worldwide in recent years. Factoring in such sourcesof growth as improvement in labor-force skills and use of newer and moreproductive equipment, TFP offers a more precise measure of efficiency than laborproductivity alone.

The trend in TFP growth has continuously weakened in advanced countries since theearly 1970s, dropping from almost 2 percent in the early 1970s to less than 0.5percent by the end of the last decade.

The trend in TFP growth in emerging countries has strengthened a great deal between1995 and 2005, when it reached up to 2 percent. However, in recent years thetrend has begun to reverse as transitional productivity effects appear to abate insome of the major emerging economies. The stabilization of the long-term trendwill depend on the balance between new investment and the efficiency with whichit is implemented.

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Emerging economies continue to driveglobal productivity growth

Productivity growth also recovered significantly in emerging economies in 2010,especially in those regions that suffered most from the global crisis such as developingAsia (excluding China and India), Latin America, Central and Eastern Europe, andRussia and other countries of the Commonwealth of Independent States.

o China and India are the largest and most dynamic economies in productivity terms, at 8.7 % and5.4 % in 2010, respectively (see below).

o Turkeys productivity growth jumped to 2.2 percent in 2010 from -5.2 percent in 2009, mostly dueto a strong GDP bounce-back; employment also kept growing.

o Brazil continued to strengthen its productivity performance at 4 percent growth in 2010,outperforming the Latin American region as a whole, which saw an increase of 3.2 percent in2010.

o Russias productivity growth has recovered remarkably from a low of -6 percent in 2009 to 3.1percent in 2010. But its underlying output and employment performance remains below theaverage of other large emerging economies.

In 2011, growth in labor productivity in emerging economies is likely to remain just below 5.0percent, similar to 2010.

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Productivitys Contribution to GlobalGrowth


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Emerging economies increasingly drive globallabor-productivity trend


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Greater efficiency in emerging economies has boostedglobal trend in Total Factor Productivity


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Tema de discutie: Unleashing Prosperity - Productivity Growth in Eastern Europeand the Former Soviet Union (Declansarea/startul prosperitii - cretereaproductivitii n Europa de Est i fosta UniuneSovietic) 2008 The InternationalBank for Reconstruction and Development - The World Bank ( 2008 Banca

Internaional pentru Reconstrucie i Dezvoltare / Banca Mondial); autori: AsadAlam, Paloma Ans Casero, Faruk Khan, Charles Udomsaph

Creterea productivitii este cel mai important

indicator unic al economiei sustenabile pe

termen lung.

Creterile de productivitate au sporit profitabilitateacompaniei. Cu profituri mai mari, ntreprinderile

sunt n msursinvesteasc n noile tehnologii,dezvoltarea de noi produse, extinderea pieelor,angajand mai muli lucrtori, salarii mai mari,simbunatatirea condiiilor de munc, precum icreterea nivelului de trai. n acelai timp,

profituri mai mari, atunci cnd apar ntr-o piacompetitiv, ajuta la atragerea de nointreprinderi i s impulsioneze inovaiitehnologice, care puse in vigoare, ajutantreprinderile existente sdevin mai eficiente.

Acest ciclu virtuos ridic eficiena economic

global i sporete creterea economic i

nivelul de trai.

Msurarea creterii productivitii. Msura cea maifrecvent utilizata este productivitatea muncii, pentruc este uor s calculeze i s interpreteze. Surprindect de multe ieiri sunt produse, n medie, de ctrefiecare unitate de fora de munc angajat n

producia de cretere aproductivitiimuncii.O alt msur este productivitatea total a factorilor

(PTF) de cretere, care se refer la o cretere aproduciei ce nu poate fi atribuita la o cretere aforeidemunc sau intrride capital. Creterea PTFreleva cresterea eficienei generate de progresultehnologic ncorporat n mbuntiri la nivel de

firm, cum ar fi metodele de producie, o mai bungestionare, o maibunasisten pentru clieni,i canalede distribuie mai bune pentru livrarea de bunuri iservicii. Att forta de munc i PTF pot fi estimate

pentru economie n ansamblul su, pentru un sector aleconomiei, sau pentru o firmindividual.

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Unleashing Prosperity - Productivity Growth in Eastern Europe and

the Former Soviet Union

Productivity growth is the single most important indicator of an economys long-term health.

Increases in productivity enhance enterprise profitability. With higher profits, enterprises are able toinvest in new technologies, develop new products, expand markets, hire more workers, pay higherwages, enhance working conditions, and raise living standards. At the same time, higher profits,

when they occur in a competitive market, help attract new firms and spur technological innovations,which can then force existing enterprises to become more efficient.

This virtuous cycle raises overall economic efficiency and boosts growth and living standards.

Countries: Albania, Armenia, Azerbaijan, Belarus, Bosnia and Herzegovina, Bulgaria, Croatia,Czech Republic, Estonia, FYR Macedonia, Georgia, Hungary, Kazakhstan, Kyrgyz Republic, Latvia,

Lithuania, Moldova, Montenegro, Poland, Romania, Russian Federation, Serbia, Slovak Republic,Slovenia, Tajikistan, Turkey, Turkmenistan, Ukraine, Uzbekistan

Sursa:

Unleashing Prosperity - Productivity Growth in Eastern Europe and the Former Soviet Union, 2008 The International Bank for Reconstruction and Development/The World Bank; authors: AsadAlam, Paloma Ans Casero, Faruk Khan, Charles Udomsaph


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Measuring productivity growth

The measure most commonly used is labor productivity because it is easyto calculate and interpret. It captures how much output is produced, onaverage, by each unit of labor employed in production.

Labor productivity growth thus gauges the increase in the amount (or value)of output generated per worker. Another measure is total factorproductivity (TFP) growth, which refers to increases in output notattributable to increases in labor or capital inputs.

TFP growth captures efficiency gains from the technological progressembodied in firm-level improvements, such as better productionmanagement methods, better customer support, and better distributionchannels for the delivery of goods and services. Both labor and TFP growthmay be estimated for the economy as a whole, for a sector of the economy, orfor an individual firm.

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Unleashing Prosperity - Productivity Growth inEastern Europe and the Former Soviet Union

The new data include corporate financial data on more than 60,000

firms in 14 countries of the Region (the Amadeus Database) and a

harmonized firm-level database drawing on a manufacturing census for

8 countries.

These microeconomic data sets permit productivity dynamics to be

studied through a decomposition of aggregate productivity growth

into the reallocation of labor across firms, firm turnover, and

internal firm efficiency. They also permit the evolution offirm demographics to be examined

over time, such as firm survival rates, average firm size among

entering firms, and the rates of the creation and destruction of firms

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The Region shows great diversity in

productivity performance and

progress in reform. Two broad

groups of countries emerge from

the analysis: the more productive,

early reformers (the EU-10 andTurkey) and the less productive,

late reformers (most of the CIS

and the SEE).

The main challenge in the EU-10 and

Turkey is to boost innovation to

compete successfully in globalmarkets, while the primary

challenge in the CIS and SEE is to

accelerate reallocation to address

the legacy of the transition.

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The countries of Eastern Europe and the Former SovietUnion (the Region, hereafter) experienced aproductivity surge over 19992005 that droveup living standards and reduced poverty.

Part of the productivity gains also derived from majorstructural changes in the economies of the

Region, as resources were progressively

shifted to higher-productivity uses in response

to changed economic and institutional

incentives. The transition to a market economyinvolved a substantial reallocation of factors(labor and capital) across sectors. Manyworkers moved out of manufacturing and intoservices, a sector that had been underdevelopedunder central planning.

But most of the productivity surge was driven by firm

dynamics. From a microeconomic perspective,productivity growth may be decomposed intothree main sources: productivity gains withinexisting firms, the reallocation of resourcesacross existing firms, and firm turnover (theentry of new, more-productive firms and the exitof obsolete firms).

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The countries of Eastern Europe and the Former SovietUnion (the Region, hereafter) experienced aproductivity surge over 19992005 that drove upliving standards and reduced poverty. Part of theproductivity gains also derived from major structuralchanges in the economies of the Region, asresources were progressively shifted to higher-productivity uses in response to changedeconomic and institutional incentives.

The transition to a market economy involved a substantialreallocation of factors (labor and capital) acrosssectors. Many workers moved out of manufacturingand into services, a sector that had beenunderdeveloped under central planning. But most ofthe productivity surge was driven by firm dynamics.From a microeconomic perspective, productivitygrowth may be decomposed into three main sources:productivity gains within existing firms, the reallocation

of resources across existing firms, and firm turnover(the entry of new, more-productive firms and the exit ofobsolete firms).

Faced with radical changes in the Regions economies, firms wereforced to adapt their behavior. Some seized new opportunities,occupying new market niches that had not been available duringcentral planning. Many obsolete firms that were supported bystate subsidies were restructured or closed down. Firms thatsurvived managed to enhance productivity by investing inworker skills and adopting new technologies, abandoning old

production lines and introducing new ones, producing newproducts, and accessing new markets.MAPP MTT 2012-2013 3310/12/2012


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Unleashing Prosperity - Productivity Growth in Eastern Europe and theFormer Soviet Union

Labor supply and demand factors explain the small contribution of labor input to total outputgrowth. A shrinking working-age population, out-migration, declines in labor participation,and high unemployment rates stifled labor supply, thereby contributing to disappointing laboroutcomes. Indeed, the employment rate has continued to fall in many countries since 1998. Whilethe employment rate is generally higher in the CIS (relative to the EU-10, where the rate is short

of the Lisbon target of 70%), many jobs in the CIS are in low-productivity occupations. Theseconstraints are compounded by deficiencies in the higher education system, which worsen skillmismatches, and rigidities in labor market regulations, which make it difficult for firms to hireworkers and slow the pace of the reallocation of workers.

The small role ofcapital accumulation in the Regions growth partly reflects inefficiencies andlow investments in new vintages of capital. In the context of a declining labor force, sustainingper capita income growth will depend on capital deepening (increasing the physical capital per

worker) and on additional productivity gains. The small impact of capital accumulation on outputgrowth, particularly in the CIS, also reflects adjustments in the corporate sector that have delayednew investments and led to the disposal of old capital stock.

In the EU-10, investment rates have not been low, but depreciation rates are high, and infrastructureprovision still lags considerably relative to the EU-15. Even more critical than the quantity ofcapital investments is the quality of the investments. The EU-10 countries have invested the mostin ICT. The use and production of ICT have propelled labor productivity growth.

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http://epp.eurostat.ec.europa.eu/portal/page/portal/structural_indicators/indicators/

The Structural Indicators cover the six

domains of General Economic

Background, Employment, Innovation and

Research, Economic Reform, Social

Cohesion as well as the Environment.

The set comprises currently 79 indicators andwas created following the invitation of the

Lisbon European Council in March 2000

to the Commission to draw up an annual

synthesis report on the basis of statistical

indicators.

The Structural indicators are an instrument for

the objective assessment of progressmade towards the Lisbon objectives, and

support the key messages of the annual

progress report.

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http://epp.eurostat.ec.europa.eu/portal/page/portal/structural_indicators/indicators/economical_context

General Economic Background

GDP per capita in PPS

Real GDP growth rate

Labour productivity per personemployed

Labour productivity per hour

worked

Employment growth by gender

Annual average inflation rate

Real unit labour cost growth Public balance

General government debt

This policy area monitors a country's prosperity the general

economic conditions which provide the basis for structural

reform.

GDP per capita (in purchasing power standards). Strong

macroeconomic conditions are essential for growth and job

creation. Gross domestic product (GDP) measures overalleconomic activity in all sectors of the economy. To compensate

for price differences between countries, GDP is measured in

purchasing power standards (PPS).

Labour productivity. Productivity is the basis for long-term economic

welfare and general economic growth. It is important for jobs and

competitiveness both are among the main targets in the EU

growth and jobs strategy.

Inflation rate . This is a performance indicator, reflecting the

background economic conditions against which progress towards

the goals of the EU growth and job strategy can be evaluated.

Public balance. Public balance and general government debt indicate

the country's financial position in the context of the "excessive

deficit procedure.

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Some indicators:

- GDP per capita (in purchasing power standards) . Strong macroeconomic conditions areessential for growth and job creation. Gross domestic product (GDP) measures overalleconomic activity in all sectors of the economy. To compensate for price differences betweencountries, GDP is measured in purchasing power standards (PPS).

- Labour productivity .Productivity is the basis for long-term economic welfare and generaleconomic growth. It is important for jobs and competitiveness both are among the maintargets in the EU growth and jobs strategy.

- Inflation rate . This is a performance indicator, reflecting the background economic conditionsagainst which progress towards the goals of the EU growth and job strategy can be evaluated.

- Public balance . Public balance and general government debt indicate the country's financial

position in the context of the "excessive deficit procedure".

Sursa:http://epp.eurostat.ec.europa.eu/portal/page/portal/structural_indicators/indicators/econ

omical_context

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Labour productivity per person employed: Gross Domestic Product (GDP) in PurchasingPower Standards (PPS) per person employed relative to the European Union average (EU-25=100). The indicator GDP per person employed intends to give an overall impression of theproductivity of national economies expressed in relation to the European Union average. For

productivity measures, GDP at current prices expressed in PPS is used. GDP is evaluated atmarket price.

The number of persons employed is equal to total employment which covers all persons bothemployees and self-employed engaged in some productive activity that falls within theproduction boundary of the economy. The number of persons employed is calculated accordingto the National Accounts concepts (ESA 95).

Purchasing Power Parities (PPPs) are currency conversion rates that convert economic indicators

expressed in national currencies and national price levels to a common currency, calledPurchasing Power Standard (PPS), which equalises the purchasing power of different nationalcurrencies and thus allows meaningful comparison across countries.

Sursa:

http://epp.eurostat.ec.europa.eu/portal/page/portal/structural_indicators/documents/eb021_-_Labour_productivity_per_person_employed.pdf

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Definitions

Labour productivity per hourworked: Gross Domestic Product (GDP) in Purchasing PowerStandards (PPS) per hour worked relative to the European Union average (EU-15=100). Theindicator GDP per hour worked intends to give an overall impression of the productivity ofnational economies expressed in relation to the European Union average. For productivitymeasures, GDP at current prices expressed in PPS is used.

The European Council (March 2005) noted that Europe must renew the basis of itscompetitiveness, increase its growth potential and its productivity, and strengthen socialcohesion, placing the main emphasis on knowledge, innovation and the optimisation ofhuman capital.

The number of persons employed is equal to total employment which covers all persons - bothemployees and self-employed - engaged in some productive activity that falls within theproduction boundary of the economy. The number of persons employed is calculated

according to the National Accounts concepts (ESA 95).The hours worked represent the aggregate number of hours actually worked as an employee or

self-employed during the accounting period, when their output is within the productionboundary.

Sursa: http://epp.eurostat.ec.europa.eu/portal/page/portal/structural_indicators/documents/eb022_-_Labour_productivity_per_hour_worked.pdf

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Labour productivity per person employed - [tsieb030]GDP in Purchasing Power Standards (PPS) per person employed relative to EU-27 (EU-27 = 100)

http://epp.eurostat.ec.europa.eu/tgm/table.do?tab=table&init=1&plugin=1&language=en&pcode=tsieb030

Gross domestic product (GDP) is a measure for the economic activity. It is defined as the value of all goods and services produced less

the value of any goods or services used in their creation. GDP per person employed is intended to give an overall impression of theproductivity of national economies expressed in relation to the European Union (EU-27) average.

If the index of a country is higher than 100, this country's level of GDP per person employed is higher than the EU average and viceversa. Basic figures are expressed in PPS, i.e. a common currency that eliminates the differences in price levels between countriesallowing meaningful volume comparisons of GDP between countries. Please note that 'persons employed' does not distinguish

between full-time and part-time employment.

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Labour productivity per hour worked - [tsieb040]GDP in Purchasing Power Standards (EU-15 = 100)

Gross domestic product (GDP) is a measure for the economic activity in an economy. It is defined as the value of all goods and servicesproduced less the value of any goods or services used in their creation. GDP per hour worked is intended to give a picture of

the productivity of national economies expressed in relation to the European Union (EU-15) average.

If the index of a country is higher than 100, this country level of GDP per hour worked is higher than the EU average and vice versa.Basic figures are expressed in PPS, i.e. a common currency that eliminates the differences in price levels between countriesallowing meaningful volume comparisons of GDP between countries. Expressing productivity per hour worked will eliminatedifferences in the full-time/part-time composition of the workforce.

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Innovation and researchhttp://epp.eurostat.ec.europa.eu/portal/page/portal/structural_indicators/indicators/innovation_and_research

Investment in human resources, research & development is essentialfor developing knowledge and new technology. The EU growth and

jobs strategy stresses the importance of information andcommunication technologies (ICT), and the i2010 strategy for aEuropean information society for growth and employment supportsthe social inclusion, better public services and quality of life.Youth education attainment level by gender. An upper secondaryschool education is generally considered the minimum for taking

part in a knowledge-based society, either for entering the labourmarket or further/higher education.Science and technology graduates by gender. A secondaryobjective is to increase the enrolment rate in scientific and technicalstudies. Europe needs mathematicians and scientists to maintain itscompetitiveness.Gross domestic expenditure on R&D. Investment in the creationof new knowledge is essential for developing new and improved

products and processes.

Patent applications to the European Patent Office (EPO)Patentsgranted by the United States Patent and Trademark Office(USPTO)Innovation and ideas must be adequately rewarded, particularlythrough patent protection.Venture capital investments by type of investment stage. Thismeasures how obstacles to investment in entrepreneurship are beingremovedto encourage a genuine European risk capital market.Broadband penetration rate. High-speed internet access is an

important factor in productivity growth and stimulating innovation ensuring Europe stays a leading player in the internet age.

Spending on Human Resources

Gross domestic expenditure on R&D (GERD)

Gross domestic expenditure on R&D (GERD) bysource of funds

Level of Internet access - households

Science and technology graduates by gender Patent applications to the European Patent Office

(EPO)

Patents granted by the United States Patent andTrademark Office (USPTO)

Venture capital investments by type of investment stage

ICT expenditure by type of product

E-Commerce via Internet

Youth education attainment level by gender E-government on-line availability

E-government usage by individuals by gender

E-government usage by enterprises

Broadband penetration rate

High-tech exports

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Gross domestic expenditure on R&D (GERD) - [tsiir020]Percentage of GDP

http://epp.eurostat.ec.europa.eu/tgm/table.do?tab=table&init=1&plugin=1&language=en&pcode=tsiir020

The indicator provided is GERD (Gross domestic expenditure on R&D) as a percentage of GDP.

"Research and experimental development (R&D) comprise creative work undertaken on a systematic basis inorder to increase the stock of knowledge, including knowledge of man, culture and society and the use ofthis stock of knowledge to devise new applications" (Frascati Manual, 2002 edition, 63 ). R&D is anactivity where there are significant transfers of resources between units, organisations and sectors and itis important to trace the flow of R&D funds.

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Research and development expenditure, by sectors ofperformance - % of GD - all sectors

http://epp.eurostat.ec.europa.eu/tgm/table.do?tab=table&init=1&plugin=1&language=en&pcode=tsc00001

Research and experimentaldevelopment (R&D) comprisecreative work undertaken on asystematic basis in order to

increase the stock of knowledge,including knowledge of man,culture and society, and the use ofthis stock of knowledge to devisenew applications.

R&D expenditures include allexpenditures for R&D performedwithin the business enterprisesector (BERD) on the nationalterritory during a given period,regardless of the source of funds.

R&D expenditure in BERD are shownas a percentage of GDP (R&Dintensity).

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Patent applications to the European Patent Office (EPO) - [tsiir060]Number of applications per million inhabitants

Data refer to applications filed directly under the European Patent Convention or to applications filed under thePatent Co-operation Treaty and designated to the EPO (Euro-PCT). Patent applications are countedaccording to the year in which they were filed at the EPO and are broken down according to theInternational Patent Classification (IPC). They are also broken down according to the inventor's place ofresidence, using fractional counting if multiple inventors or IPC classes are provided to avoid double

counting.

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ICT expenditure by type of product - [tsiir090]; Information TechnologyExpenditure - Percentage of GDP

ICT expenditure by type of product - [tsiir090]; Communications Expenditure

Percentage of GDP

Annual data on expenditure fortelecommunication hardware,equipment, software and other services

as a percentage of GDP.[tsiir090] - ICT expenditure by type of product;Communications Expenditure

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Annual data on expenditure for IThardware, equipment, software andother services as a percentage of GDP.

[tsiir090] - ICT expenditure by type of product;Information Technology Expenditure


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High-tech exports - [tsiir160]Exports of high technology products as a share of total exports

This indicator is calculated as share of exports of all high technology products of total exports.

High Technology products are defined as the sum of the following products: Aerospace,Computers-office machines, Electronics-telecommunications, Pharmacy, Scientificinstruments, Electrical machinery, Chemistry, Non-electrical machinery, Armament. Thetotal exports for the EU do not include the intra-EU trade.

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High-tech exports - % of exportshttp://epp.eurostat.ec.europa.eu/tgm/table.do?tab=table&init=1&plugin=1&language=en&pcode=tin00140

This indicator is calculated as share ofexports of all high technologyproducts of total exports.

High Technology products are defined

as the sum of the followingproducts: Aerospace, Computers-office machines, Electronics-telecommunications, Pharmacy,Scientific instruments, Electricalmachinery, Chemistry, Non-electrical machinery, Armament.

The total exports for the EU do notinclude the intra-EU trade.

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Environment - Resource productivity (EUR per kg)-[tsien140]

In the context of the EU growth and jobs strategy,environmental concerns mean "greening up the

economy" to take account of the environmental impact ofdecisions and activities in other sectors.

Greenhouse gas emissions. The potential negative impacts ofthese emissions on the environment are so severe that theycould affect sustainable growth the main goal of thegrowth and jobs strategy.

Energy intensity of the economy. This monitors thedecoupling of energy use from GDP growth and shows

the extent to which energy is being used more efficientlyin the creation of wealth.

Electricity generated from renewable sources. Sustainableeconomic growth depends on more energy being

produced from renewable sources.

Volume of freight transport relative to GDP

Volume of passenger transport relative to GDP. Thereshould be a decoupling between GDP growth and

transport growth. Increased traffic can damage theenvironment and economic growth through congestion,noise and pollution.

Resource productivity. An aggregate measure of the materialefficiency of an economy, showing whether the use ofnatural resources is being decoupled from economicgrowth.

Municipal waste generated. Municipal waste by type of

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Whats new inthe field of STI policy?

Innovation in the crisis and beyond

The economic crisis that started in 2008 has negatively affected businessinnovation and R&D in all countries.

The crisis and the recovery have been uneven across countries,industries and categories of firms.

Some have featured better: countries in Asia, including Korea and

China; large multinational firms in high tech industries.VC, start ups and SMEs have been hit the hardest, and have not

recovered yet (entrepreneurship still low).

The crisis has revealed and amplified weaknesses (and strengths) whichpre-existed, across countries, sectors and firms.

Policy responses:

- Recovery plans (2009) were heavily loaded in S&T and innovationrelated expenses

- Austerity is now gaining in most countries and S&T budgets arealso under pressure but recognition of the central role of

innovation for engineering a sustainable recovery.

- Foreseeable growth perspectives and the financial situation of mostgovernments indicate that this downward pressure is likely tobe maintained in the coming years.

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Business enterprise R&D has partially recovered after

the 2008-09 shock


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Innovating for Social and Global Challenges

Green innovation

High on the agenda of most OECD governments.

Requires aligning the objectives of the various stakeholders and linking supply- and

demand-side policies

Ageing society Innovation can help the elderly remain healthy, autonomous and active (e.g. biomedicine,

robotics, and IT)

Still, a risk for long-term innovation capacity

Thus the need forlife-long learning and international cooperation

Innovation for development

Innovation is not a preserve of the rich, its an engine for economic and social development

(e.g. health, education, etc.)

Types of innovation include tech, non-tech and social innovation

=> New market and learning opportunities!

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Major national STI policy developmentsThe changing context of innovation policies

The economic crisis is having major effects on innovationpolicies:

- New constraints on policies (STI budgets),

- Reshuffling priorities (competitiveness, growth and job creation atthe top)

- Higher requirements for efficiency and effectiveness (changing thepolicy mix)

Combined with other trends and factors: newchallenges, new technology (IT), globalisation.

Strengthened priority given by governments to

innovation and STI policy

The changing innovation policy mix

Demand-side policies (procurement, standards): still emerging

(green)

Entrepreneurship policies: new firms seen as major vehicles of

innovation; tendency to extending policy attention from the

creation to the expansion stage.

Commercialisation of public sector research: more integrated

Tax incentives: more countries, broader use

Targeted policies: clusters, smart specialisation, new industrial

policies

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Whats new inthe field of STI policy?

Patent Filings are hit by

the crisis

PCT Filings; 5 months moving

average; yearly growth rates(%)

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Large firms have recovered quickly

Growth rates in R&D investments and sales of top EU and US corporateR&D investors, 2008-10 (%)

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Large medium-tech manufacturers (e.g. automobile)have been hit strongly

Source: OECD STI Outlook 2012 based on EU (2011), EU industrial R&D investments Scoreboard.

Sales, R&D and employment growth for firms in high-, medium-high and low-technology industries,2008-09 and 2009-10 (%)

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Between 1996 and 2006, the European Uniontransformed its technology balance of

payments deficit into a surplus

Sursa: OECD ST scoreboard 2009

The technology balance of payments provides a

measure of international technologytransfers: licence fees, patents, purchasesand royalties paid, know-how, research, andtechnical assistance.

Unlike R&D expenditure, these are paymentsfor production-ready technologies.

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Technology transfer - FDI

In most OECD countries, technological receipts and payments increased sharply during the 1990s and up to mid-2000. Between 1996 and 2006, the European Union transformed its technology balance of payments deficitinto a surplus, although this includes intra-EU flows.

The US surplus increased slightly while the most spectacular improvement occurred in Japan. Overall, the OECDarea maintained its position as net technology exporter vis--vis the rest of the world. Technologicaldevelopment can be achieved either through domestic R&D expenditure or the acquisition of foreigntechnology. In Greece, Hungary, Ireland, Poland and the Slovak Republic, among others, technology imports

exceed technology exports.

R&D funding from abroad also plays quite an important role in the funding of business R&D. Most R&Dinvestments still go to OECD countries; however, China and India, among other emerging countries, areincreasingly considered as attractive locations for R&D. In the EU27, funding from abroad representedaround 10% of total business enterprise R&D in 2006.

The share offoreign affiliates in industrial R&D varies widely across countries, ranging from 5% in Japan toover 60% in Ireland and the Slovak Republic. In Belgium, the Czech Republic, Portugal and Sweden the

share of R&D expenditure by foreign affiliates is over 40%.Collaboration with foreign partners can play an important role in the innovation process by allowing firms togain access to a broader pool of resources and knowledge at lower cost and also offers a way to share therisks with partners. The share of European firms collaborating on innovation with partners across Europeranges from less than 2% in Spain and Turkey to over 13% in Finland, Luxembourg and Slovenia.Collaboration with partners outside Europe is much less frequent and concerns between 1% and 5% of firmsin most European countries. Overall, innovating firms from the Nordic countries and some small Europeaneconomies (Belgium, Luxembourg and Slovenia) tend to collaborate more frequently with partners abroad.

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Patent - definition

A patent is a set of exclusive rights granted by a state (national government) to aninventor or their assignee for a limited period of time in exchange for a public disclosureof an invention.

The procedure for granting patents, the requirements placed on the patentee, and the extentof the exclusive rights vary widely between countries according to national laws andinternational agreements. Typically, however, a patent application must include one ormore claims defining the invention which must be new, inventive, and useful orindustrially applicable. In many countries, certain subject areas are excluded from patents,such as business methods and mental acts. The exclusive right granted to a patentee inmost countries is the right to prevent others from making, using, selling, or distributing thepatented invention without permission.

Under the World Trade Organization's (WTO) Agreement on Trade-Related Aspects ofIntellectual Property Rights, patents should be available in WTO member states for anyinventions, in all fields of technology, and the term of protection available should be theminimum twenty years. Different types of patents may have varying patent terms (i.e.,durations).

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Patent applications to the European Patent Officehttp://epp.eurostat.ec.europa.eu/tgm/table.do?tab=table&init=1&plugin=1&la

nguage=en&pcode=tsc00032

Applications per million inhabitants

Data refer to applications filed directly under theEuropean Patent Convention or to

applications filed under the Patent Co-operation Treaty and designated to the EPO(Euro-PCT).

Patent applications are counted according to theyear in which they were filed at the EPOand are broken down according to theInternational Patent Classification (IPC).

They are also broken down according to theinventor's place of residence, usingfractional counting if multiple inventors orIPC classes are provided to avoid doublecounting.

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World BankWorld DevelopmentIndicatorsScience & Technology

High-technology exports (current US$)

High-technology exports are products with high R&Dintensity, such as in aerospace, computers, pharmaceuticals,scientific instruments, and electrical machinery. Data are incurrent U.S. dollars.

United Nations, Comtrade database. High-technology exports (% of manufactured exports)

High-technology exports are products with high R&Dintensity, such as in aerospace, computers, pharmaceuticals,scientific instruments, and electrical machinery.

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Research and development expenditure (% ofGDP)

Expenditures for research and development arecurrent and capital expenditures (both public andprivate) on creative work undertaken systematicallyto increase knowledge, including knowledge ofhumanity, culture, and society, and the use of

knowledge for new applications. R&D covers basicresearch, applied research, and experimentaldevelopment.

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World BankWorld Development IndicatorsScience &Technology - Patent applications, residents

Patent applications are worldwide patent applications filed through the PatentCooperation Treaty procedure or with a national patent office for exclusive rightsfor an invention--a product or process that provides a new way of doing somethingor offers a new technical solution to a problem. A patent provides protection for the

invention to the owner of the patent for a limited period, generally 20 years. World Intellectual Property Organization (WIPO), World Intellectual Property Indicators and www.wipo.int/econ_stat.

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Patent applications, residents 2010 (source: WB-WDI)

1060.313

241.977

2.196

0

50

100

150

200

250

300

1963

1965

1967

1969

1971

1973

1975

1977

1979

1981

1983

1985

1987

1989

1991

1993

1995

1997

1999

2001

2003

2005

2007

2009

Thousan

ds

0

200

400

600

800

1000

1200

Thousan

ds

World ROU United States Sweden

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World BankWorld Development IndicatorsScience & TechnologyRoyalty and license fees, payments (BoP, current US$)Royalty and license fees, receipts (BoP, current US$)

Royalty and license fees are payments and receipts between residents and nonresidents for theauthorized use of intangible, nonproduced, nonfinancial assets and proprietary rights (suchas patents, copyrights, trademarks, industrial processes, and franchises) and for the use,through licensing agreements, of produced originals of prototypes (such as films andmanuscripts). Data are in current U.S. dollars.

International Monetary Fund, Balance of Payments Stati stics Yearbook and data files.

1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011

Royalty and license fees, payments (BoP, current US$) Royalty and license fees, receipts (BoP, current US$)

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Scientific and technical journal articles

Scientific and technical journal articles refer to the number of scientific and engineeringarticles published in the following fields: physics, biology, chemistry, mathematics,clinical medicine, biomedical research, engineering and technology, and earth and spacesciences.

National Science Foundation, Science and Engineering Indicators.Trademark applications, direct resident

Trademark applications filed are applications to register a trademark with a national orregional Intellectual Property (IP) office. A trademark is a distinctive sign which identifiescertain goods or services as those produced or provided by a specific person or enterprise.A trademark provides protection to the owner of the mark by ensuring the exclusive rightto use it to identify goods or services, or to authorize another to use it in return for

payment. The period of protection varies, but a trademark can be renewed indefinitelybeyond the time limit on payment of additional fees. Direct resident trademarkapplications are those filed by domestic applicants directly at a given national IP office.

World Intellectual Property Organization (WIPO), World Intellectual Property Indicators andwww.wipo.int/econ_stat.

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Measuring innovation

Patents are a proxy for innovation. Some innovation inputs, such as the educational attainments of the workforce, have a direct

impact on innovation; others, such as macroeconomic stability, have an indirect Some countries are better at converting these inputs into innovation output than others.

Although the number of patents may be an imperfect measure of innovation , it correlateswell with three other proxies for innovation performance:Citations from scientific and technical journals per million population. The data are for

2003 from Science and Engineering Indicators 2006 published by the US National ScienceFoundation, and Thomson ISIs Science Citation Index.

The average of two ratios: the share of medium- and high-technology products in acountrys manufacturing output and the share of medium- and high-technologyexports in its total manufacturing exports, taken from the United Nations Industrial

Development Organisation (UNIDO) Industrial Development Report 2005. The results of a survey question from the World Economic Forums Global

Competitiveness Report 2006 that asked respondents to rate the extent to whichcompanies in 125 countries were adept at, or able to absorb, new technology.

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What factors lead to innovation on a nationallevel?

The direct drivers of innovation The direct drivers - factors closely linked to innovation - are selected from abroader index called the Business Environment Rankings (BER), an Economist Intelligence Unit database.These direct drivers are:

R&D as a % of GDP Quality of the local research infrastructure Education of the workforce

Technical skills of the workforce Quality of IT and communications infrastructure Broadband penetrationEach country is ranked according to its score forthese direct inputs, a number that is based on the unweighted

average of the six indicators.

The indirect drivers of innovation A separate index was constructed for the indirect inputs, the broad economic,social and political factors that facilitate (or hinder) innovation activity. The innovation environment index is

based on the following 12 factors: Political stability, Macroeconomic stability, The institutional framework,The regulatory environment, Tax regime, Flexibility of the labour market, Openness of national economy toforeign investment, Ease of hiring foreign nationals, Openness of national culture to foreign influence, Accessto investment finance, Protection of intellectual property, Popular attitudes towards scientific advancements -the source for all the indicators is the BER, with the exception of popular attitudes towards science, which istaken from the World Values Survey, published by a global network of social scientists.

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The worlds most innovative economies

An Economist Intelligence Unit report

Sponsored by Cisco In 2007 the Economist Intelligence Unit, sponsored by Cisco, developed an innovation

index that ranked 82 countries based on their innovation capacity from 2002 to 2006, andforecast their performance through to 2011. The ranking was part of a broader study,

Innovation: Transforming the way business creates, that investigated what makescountries and companies innovative.

Innovation is defined as the application of knowledge in a novel way, primarily foreconomic benefit. Companies deem it vitally important as a competitive tool.Government policymakers see it as essential for economic growth.

The Economist Intelligence Unit (EIU) measures innovation output by the number ofpatents granted to people from different countries by the patent offices of the US, theEuropean Union and Japan.

The index also looks at factors that help or hinder the ability to innovate, such as theamount of research and development (R&D) and the technical skills of the workforce.

The report includes innovation predictions for the next five years, and more gains forthe emerging world are expected. But even so, developed countries will not lose theirstatus as the most innovative in the world. Japan, the US and European countries such asSwitzerland, Finland, Germany and Sweden will still rank among the top 10 globally in2013. But countries such as China, India and South Africa will continue to rise up theinnovation rankings, albeit from a much lower level.

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EIU The most innovative countries

The main findings ofInnovation: Transforming the way business creates include:

innovation is beneficial to both national economies and corporate performance, but its impact ismore visible at the microeconomic than the macroeconomic level;

innovative companies tend to outperform their peers;

firms connected to high-tech clusters tend to outperform their peers;

technical skills of the workforce and IT/telecommunications infrastructure are critical to innovation; small countries have an advantage;

return on investment (ROI) is higher in middle-income countries than in rich countries.

Innovation at a global level is now expected to advance at a significantly slower pace over the nextfive years than was previously forecast. The current financial turmoil will affect a variety of theinnovation inputs that directly drive innovation. It is likely to result in a reduction of investment inresearch and development (R&D), spending on training and education, and the quality ofinformation and communications technology (ICT) infrastructure. The economic crisis will alsohave a negative impact on certain aspects of the environment that enable innovation - access tofinance for firms, conditions for entrepreneurship, and economic and political stability. Asignificant slowdown in the pace of innovation would harm the long-term prospects for economicgrowth around the world.

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EIU - The most innovative countries

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Comparison - Current and forecast innovation index

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The 25 Most Innovative Companies 2010

Innovation Winners

Bloomberg BusinessWeek's Most InnovativeCompanies special report is based on datafrom longtime partner Boston ConsultingGroup (BCG). Last December the consultancye-mailed a 21-question poll to seniorexecutives around the globe. The 1,590

respondents, who answered anonymously,were asked to name the most innovativecompanies outside their own industry in 2009

No. 1: Apple. With remarkable consistency since its foundingin 1976, Apple (AAPL) has invented products that haverevolutionized demand for digital technology. Look forits latest, the iPad, to disrupt the market for many other

portables, including the netbook and even the laptop.No. 2: Google. Google (GOOG) and Apple (AAPL) once

were allies. But with its Droid smartphone, Google has

made a run into Apple iPhone territory. Its Fiber forCommunities project envisions building networks inU.S. cities that will deliver speeds 100 times faster thanexisting services.

No. 3: Microsoft. The software leviathan is still nimble. ItsWindows 7 operating system fixed shortcomings ofVista, while Bing has more than 10% of the onlinesearch market. Next up: Microsoft Outlook 2010, whichsynchronizes e-mail, contacts, and social-mediaapplications.

No. 4: IBM. The company that gave the world the PC long

ago got out of the hardware business, remaking itselfinto a global technology consultant. For example, it hascollaborated with a Toronto hospital to help doctorsmonitor minute changes in the health of premature

babies.No. 5: Toyota Motor. Oops. For years the world's biggest

carmaker was a role model for innovation, thanks to itsreputation for high-quality vehicles and industry-leadinghybrid lineup. Following massive recalls for sudden-acceleration problems, Toyota's (TM) next reinvention isits own image

Gl b l I ti I d 2012
http://images.businessweek.com/ss/10/04/0415_most_innovative_companies/index.htmhttp://stockmarket.businessweek.com/www/search.html?q=AAPLhttp://stockmarket.businessweek.com/www/search.html?q=GOOGhttp://stockmarket.businessweek.com/www/search.html?q=AAPLhttp://stockmarket.businessweek.com/www/search.html?q=TMhttp://stockmarket.businessweek.com/www/search.html?q=TMhttp://stockmarket.businessweek.com/www/search.html?q=AAPLhttp://stockmarket.businessweek.com/www/search.html?q=GOOGhttp://stockmarket.businessweek.com/www/search.html?q=AAPLhttp://images.businessweek.com/ss/10/04/0415_most_innovative_companies/index.htm


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Global Innovation Index 2012Stronger Innovation Linkages for Global

Growth is a recognition of the key role that innovation serves as a driver of economic growth and prosperity. It is

also an acknowledgement of the need for a broad horizontal vision of innovation that is applicable to bothdeveloped and emerging economies, with the inclusion of indicators that go beyond the traditionalmeasures of innovation (such as the level of research and development in a given country). The GII is avaluable benchmarking tool to facilitate public-private dialogue, whereby policymakers, business leadersand other stakeholders can evaluate progress on a continual basis

INSEAD, a leading graduate business school with three campuses on two continents, and the WorldIntellectual Property Organization (WIPO, a specialized agency of the United Nations)

The 2012 GII is the simple average of two sub-indices: the Innovation Input Sub-Index 5 (assessing Institutions, Human capital & research, Infrastructure,

Market sophistication, and Business sophistication) the Innovation Output Sub-Index 2 (assessing actual evidence of innovation outputs, namely

Technological outputs and Creative outputs).

The GII is described by 84 indicators of three different types: quantitative data (62 indicators), compositeindicators (16 indicators) and survey data (6 indicators).The 2012 GII model includes 141 countries that represent 94.9% of the world's population and 99.4% of the

world's GDP. The top 10 include Switzerland, Sweden, Singapore, Finland, United Kingdom, Netherlands,Denmark, Hong Kong (SAR, China), Ireland, and the United States.

Most of the old EU member states (EU-15) are in the top 30 of the GII ranking. However, some of the newmember states, namely Malta (16th), Estonia (19th), Slovenia (26th), Czech Republic (27th), Cyprus(28th), Latvia and Hungary (30th) have improved their ranking and are now ahead of Portugal (35th), Italy(36th), and Greece (66th). All EU 27 countries are represented in the ranking.

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Innovation Input Sub-Index

Institutions. Nurturing an institutional framework that attracts business and fosters growthby providing good governance and the correct levels of protection and incentives isessential to innovation. The Institutions pillar captures the institutional framework of acountry

Human capital and research. The level and standard of education and research activity

in a country are the prime determinants of the innovation capacity of a nation. This pillartries to gauge the human capital of countries Infrastructure. A good and ecologically friendly communication, transport, and energy

infrastructure facilitates the production and exchange of ideas, services, and goods andfeeds into the innovation system through increased productivity and efficiency, lowertransaction costs, better access to markets, and sustainable growth.

Market sophistication. The ongoing global financial crisis has underscored how crucialthe availability of credit, investment funds, and access to international markets are forbusinesses to prosper.

Business sophistication. businesses foster their productivity, competitiveness, andinnovation potential with the employment of highly qualified professionals andtechnicians.

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Institutions pillar

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Documents

12-13_curs MTT Transfer Technology 10122012