As OECD countries continue to take measures to sustain the economic recovery, support to innovation features prominently on the agenda of policy makers. However, in the current context of weak demand in the economy and faced with challenges of global dimension, countries must not only address market failures that lead to under-investment in innovation on the supply-side, they must also focus on the demand-side to foster the uptake of innovation in the public and private sectors.
This was the premise with which the OECD organised this workshop on demand-led innovation policies under the auspices of the Committee on Industry, Innovation and Entrepreurship (CIIE) and the Committee for Scientific and Technological Policy’s (CSTP’s) Working Party on Innovation and Technology Policy (TIP). The workshop brought together policy makers, economists, and business representatives to share their views and experience in fostering demand for innovation via market and public policy instruments including public procurement, pricing, regulations, standards-setting and lead markets. A key finding from the workshop was that governments need to align technology-push instruments like grants and incentives for R&D with demand-pull policy instruments such as public procurement and regulations. The discussions and expert presentations from the workshop provided further insights and examples as to how countries are attempting to implement this in practice. The findings and views that emerged from the workshop will contribute to the development of the OECD Innovation Strategy to be presented to OECD Ministers in 2010.
Click here for the Summary of the Workshop. The programme and presentations are available below.
For further information, please contact Mario Cervantes, Science and Technology Policy Division, OECD
OECD Workshop on Demand-Led Innovation Policies
14-15 September 2009
Welcome and Opening : Andrew Wyckoff, Director, Directorate for Science, Technology and Industry
Keynote presentation: Key issues in demand-side innovation policies
Keynote speaker: David Evans, Senior Advisor for Government Affairs to the Technology Strategy Board, United Kingdom
Session 1: Dynamics of demand for innovation
This session explored the role of demand for innovation at the level of industries and firms, examining critical issues along the innovation-value chain among others the diffusion of innovation by early users.
Session Chair: James Watson, Department for Business, Innovation & Skills, United Kingdom
Mario Cervantes, Science and Technology Policy Division, OECD “Demand-led Innovation: What role for policy”
a) The innovation value chain
Discussion on: What the main challenges are in influencing the creation of new innovation value chain? What are the supply restrictions? And do lead markets provide an effective instrument to incubate new innovation value chains?
Henriette Van Eijl, DG-Enterprise and Lead Markets, European Commission
Discussant/commentator: Professor Franco Malerba , Bocconi University, Italy
b) User-led innovation and lead markets
Discussion on: Early users play a crucial role in the diffusion of innovation and hence the demand for it. How can the interaction between early users and producers enhance innovation via demand channels?
How can this interaction be leveraged to create lead markets and what should be the role of policy?
Sigrid Dahlerup, FORA, Denmark, “The Danish user-driven policy programme”
Michelle Mahdon, Programme Leader, The Work Foundation, United Kingdom, “The Serendipity of Interaction: The role of consumer preferences in the innovation process”
Discussant/commentator: Dr. Rian Beise-Zee, Asian Institute of Technology, Bangkok, Thailand
Session 2: Policies to foster demand -led innovation
This session explored the role of public and social demand in innovation, focusing on the policies and on sectoral approaches in demand-side policy (e.g. ICT, health innovation, green innovation or services innovation). It will also explore some of the difficulties and trade-offs in implementing such policy instruments, e.g. in ensuring competition and performance, and in fostering risk-taking.
Session Chair: Henriette Van Eijl, DG-Enterprise and Lead Markets, European Commission
a) Meeting Social and Public Demands through Innovative Procurement
Discussion on:What the main trends are with regard to public procurement for innovation in OECD countries? What are the main barriers and risks in implementing procurement for innovation? What are the main policy considerations? What lessons can be drawn?
James Sheppard, OECD Governance Directorate “Public procurement in OECD countries: Issues and Policies”
Petri Lehto, Innovation Department, Demand-Based Innovation, Ministry of Employment and the Economy, Finland “Public procurement and the new financial instrument for innovative public procurement”
Mike Weber, Technische Universität Berlin, Germany “Germany’s experience with procurement for innovation”
David Bloch, Partner, Winston & Strawn, LLP, United States “Intellectual property issues arising in government procurement for innovation: the case of the United States”
Discussant: Peter Bennett, OECD Governance Directorate
b) Demand-led innovation: Sectoral Approaches
Discussion on: What are the current status of demand-side innovation in strategic or mission- oriented areas, especially global challenges? What policy instruments are mainly used considering sector specific characteristics as well as the trends towards technological convergence?
Xavier Leflaive, Principal Administrator, OECD Environment Directorate “Measures in OECD countries to stimulate demand for eco-innovation”
Kenji Ueki, METI, Japan, “Fostering green innovation in Japan including through regulations/standards”
Matthew Squire, Department of Innovation, Industry, Science and Research, Australia : Demand-led innovation initiatives : early results from Australia”
Session 3: Evaluation of demand-side innovation policies
This session explored some of the issues that arise in implementing evaluations of demand-side policies, including how to assess both the direct and indirect outcomes of such policies.
Session Chair: Iain Gillespie, Head of the Science and Technology Policy Division, DSTI, OECD
Discussion on:What are the direct and indirect impacts of demand-side policies and how can they be measured? Compared with supply-side innovation, what are the main differences and also challenges in evaluation demand-side measures? How does one evaluate the policy mix of supply and demand instruments?
Professor Jakob Edler, MIIR, University of Manchester, United Kingdom
Discussant: Dr. Woo Sung Lee, STEPI, Korea
Session 4: Implications for the Innovation Strategy: Panel discussion
The key policy issues in demand-side innovation and the implications for the Innovation Strategy will be explored by the panel through a series of questions. This includes governance issues and potential policy trade-offs that may need to be addressed.
Session Chair: Patrick Vock, Chairman of TIP, Switzerland
- Henriette Van Eijl, DG-Enterprise and Lead Markets, European Commission
- Jorgen Rosted, Director, Fora, Ministry of Enterprise and Construction, Denmark
- Professor Jakob Edler, MIIR, University of Manchester, United Kingdom
- Karl Schmitt, Siemens, Germany
- Professor Franco Malerba , Bocconi University, Italy
Summary of the Workshop