Five questions innovation policymakers should be asking
Every year we spend quite a lot of time thinking about the key challenges that innovation policymakers face. These are some of the questions that we think are important, and that we will be discussing at the IGL2017 Global Conference in Barcelona on 13-14 June:
1. How can we better use data to understand our innovation ecosystem and develop better policies?
Good policy requires good data. It helps us understand how innovation ecosystems perform, where there are gaps and where there are opportunities. But until very recently the data policymakers had to guide their decisions was very limited. It was not real time (but rather several years old) and failed to capture many important components.
The explosion of data creates new opportunities to understand the connections between different actors in the ecosystem (such as Endeavour’s maps using LinkedIn data), track high growth startups in real-time (such as MIT’s assessment of the quality of US entrepreneurs) and map new emerging sectors (such as the UK’s video games industry map), among many others.
2. How can we take advantage of artificial intelligence and robotisation so that they lead to better jobs rather than more unemployment?
New waves of technological change raise productivity growth, but can also cause major disruption. Throughout history we’ve seen how new technologies displaced workers, but employment eventually recovered, with new occupations replacing old ones. Whether this time will be different is a much debated question.
Regardless of the answer, there are several actions that we can take now to prepare for the transition, such as understanding what skills will be needed in the future, starting to re-skill our existing workforce (as Singapore is doing with its SkillsFuture Credit), and trying out new models of redistribution to compensate those that lose out in this process (such as Finland’s basic income trial).
3. How can we accelerate productivity growth throughout the economy?
Productivity growth has stagnated across advanced economies, but the slowdown has not been uniform. Firms at the frontier have continued to increase their productivity at a good pace, while productivity growth for the majority of firms has stagnated.
Can policymakers speed up technology diffusion to reduce this widening productivity gap? What is constraining firms’ investment in new technologies and better processes? Can we unlock additional bank finance for the majority of innovative SMEs that are not a good fit for venture capital equity investments?
Singapore's government Intellectual Property Financing Scheme (a credit guarantee for intangible-based lending), and the free IP business valuation reports offered by the Japan Patent Office are both interesting initiatives to learn more about. They support private lending to SMEs investing in value-creating intangible assets, which are of increasing importance.
4. Can we use regulation in new ways to speed up innovation?
Emerging technologies create regulatory challenges for entrepreneurs and policymakers alike. Entrepreneurs often face uncertainty about how their ideas fit within a set of rules written before those technologies and business models were even imagined. Regulators face the difficult task of designing regulatory regimes that are flexible enough for new activities to emerge but sufficiently robust to protect consumers against some of the risks they might create - all the while rewarding innovation and ensuring fair competition.
To meet these challenges requires innovation in the way regulation is developed. For example, new models of ‘anticipatory regulation’ are popping up around the world – using regulation to help accelerate new organisational and business models. Interesting examples are the UK financial regulatory sandbox, which is being replicated in different countries and sectors, and the EU innovation deals programme, which built on the Dutch green deals.
5. How best to achieve impact?
European governments alone spend €152 billion every year in business programmes to support entrepreneurship, innovation and growth. Yet we have very limited evidence on its impact. Could we re-design these programmes to achieve greater impact? Are there other ways to use our limited public funding in a more effective way? And crucially, how would we know?
The answer is to become more experimental. Rather than assuming we have the best design for a programme, we should first test at a small scale to find out what works best. This is a simple idea, yet implementing it is not as simple, so at the Innovation Growth Lab (IGL) we’ve been working with a dozen government agencies around the world to help them become more experimental.
Join us at IGL2017 to discuss the answers to these questions
At the IGL2017 Global Conference in Barcelona on 13-14 June we will hear first-hand experiences from the people leading some of these initiatives.
Over 50 confirmed speakers from five different continents will discuss the next generation of innovation and entrepreneurship policies, how to address these crucial policy challenges, and the power of experimentation to transform this space. Plus, a series of capacity building workshops will help participants improve their organisation’s capability to design more impactful policies.