This paper analyses the rising productivity gap between the global frontier and other firms and raises key questions about why technologies do not always diffuse to all firms. It argues that well-designed framework policies can aid productivity diffusion by sharpening firms’ incentives for technological adoption and by promoting a market environment that reallocates resources. It also highlights the role of R&D tax incentives, business-university R&D collaboration and patent protection, but trade-offs emerge which can inform the design of innovation-specific policies.

‘Frontier firms, technology diffusion and public policy’ is the second in a new OECD Working Paper series on productivity.

Two newly-released STI working papers examine investment in training and organisational capital (OC). The first, Estimating Cross-Country Investment in Training: An Experimental Methodology Using PIAAC Data proposes a methodology for measuring investment in training. Estimates suggest that average total investment in training corresponds to 6.7% of gross value added (GVA), with investment in on-the-job training amounting to 2.4% of GVA on average.

The second paper, Cross-Country Estimates of Employment and Investment in Organisational Capital: A Task-Based Methodology Using PIAAC Data proposes a task-based methodology for measuring employment and investment in OC in 20 OECD countries. The paper finds that the share of OC occupations in total employment amounts to about 16% on average, and that investment in OC is generally higher in the public sector than in the private sector. Moreover, in the services sector, on average half of investment in OC comes from small firms, while in manufacturing, 45% of investment in OC comes from large firms.

Maximising the potential of Korea’s creative economy will require leveraging its science and technology capacity, capturing the benefits of the digital economy, advancing green innovation, and addressing low productivity in the services sector.

This report also argues that the Korean STI system would benefit from improving the efficiency of public R&D investment, including by strengthening fundamental research and reforming the system for evaluating the performance of national R&D programmes.

Save the date: September 19-21, 2016
Please mark your calendars now for the third edition of the OECD Blue Sky Forum on Science, Technology and Innovation indicators. Previously held in Paris (1996) and Ottawa (2006), data producers, expert users and policy makers will come together in the city of Ghent (Belgium) to discuss the next generation of data and indicators required to improve our understanding of science and innovation and inform better policies. Blue Sky will follow the CSTP ministerial mandate to identify key trends, opportunities and priorities and define the long term agenda for OECD work on science and innovation data and indicators over the next decade.

More information will be released in January with the call for papers and contributions. For more information contact OECD.Bluesky3@oecd.org

It is more urgent than ever for policy makers to ensure a level playing field and give more room to young firms to experiment with new technologies and organisational models to foster their growth. By changing policy orientations in favour of innovation and business dynamism, leaders can unleash the dynamic low-carbon future we urgently need.

This article argues that new innovative firms are needed to help step up the fight against climate change. That means new policies to encourage business dynamism, not least in the energy sector. Low-carbon infrastructure and products may well be developing fast, but as OECD and IEA reports indicate, new breakthroughs are needed to shift the balance away from fossil fuel options.

As an important CO2 emitter, the world steel industry is being called on to play a major role in mitigating climate change. Significantly reducing emissions requires shifting away from current production methods towards new methods of production. While the industrial application of already existing technologies could contribute significantly to mitigating climate change, in the longer term breakthrough technologies are required to reduce the impacts even further. Greening Steel argues that a better understanding of how to incentivise and induce both incremental and radical innovations in steel that can help mitigate climate change is needed.

Broadband speed matters. High-speed broadband networks generate positive benefits, contribute to economic growth and make firms more productive. All OECD countries recognise the benefits that stem from high-speed broadband networks and have made tremendous progress in recent years in fostering their deployment. Nonetheless, many challenges remain in terms of how to enhance and expand these networks to meet the growing demands of an increasingly digital economy and society. This report examines some experiences with municipal broadband networks in selected OECD countries.