Estonian RD and innovation governance system

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Estonian RD and innovation governance system
Policy
Policy
design
design
P
arliament
P
arliament
Government
Government
RD Policy Council
RD Policy Council
Innovation Policy Commission
RD Policy Commission
Innovation Policy Commission
RD Policy Commission
Ministry of Economic Affairs
Ministry of Education and
Ministry of Economic Affairs
Ministry of Education and
P
rogramme
P
rogramme
and Communications
Research
and Communications
Research
design
design
Science Competence Council
Science Competence Council
Academy of Sciences
Academy of Sciences
P
rogramme
P
rogramme
Enterprise Estonia
administra
-
administra
-
Enterprise Estonia
KREDEX
Science Foundation
Archimedes Foundation
KREDEX
Science Foundation
Archimedes Foundation
tion
tion
Projects
Projects
Universities
RD Institutes
Firms
Universities
RD Institutes
Industry
VC
Competence Centres
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• Underlying factors
• Slow recovery from low funding situation in 90-s
• (ageing of academic personnel, low output of
  PhDs in economically critical areas)
• Time-lag in terms of results from research and
  innovation system- no sufficient political
  consensus about the importance of the area
• Growth of Public RTD I to GDP is lower than
  anticipated in RD strategy for Estonia
• Substantial usage of EU structural funds
  (advantages and risks)
• No national industrial champions with high
  private RD expenditure and substantial economic
  weight
• Generally low level of collaboration between
  industry and academia

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• Challenges in general
• Support individual projects (no regard to sector)
  or active policy engineering towards technology
  programs and clusters
• Internationalization of the RTD I
• Avoiding long term brain-drain, attracting
  international talents
• Bridging the industry and research sector
• Learning from the best practice as well as
  mistakes of other research and innovation systems

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Policy framework

• Objectives set out in Knowledge Based Estonia
  2002-2006 and 2007-2013
• Updating pool of knowledge, focus on three
  technology areas
• Increasing the competitiveness of industry, main
  precondition integration mechanisms between
  research and industry
• Main targets related to
• Increasing level of expenditure on RD, notably
  business expenditure
• Better balance between basic and applied research
  activities

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Technology Push

• public spending on RD is heavily weighted towards
  basic research (50 of total expenditure) with
  only 16 spent on technological development
• the universities are regarded as the major source
  of technology expertise, and of research
  capability in comparison, in the EU, business
  is the major performer of RD, 66 of total RD,
  only appr. 2,4 is being subcontracted to the HE
  sector
• university researchers are mainly funded through
• Targeted Financing funds (approx 38 of total
  public RD funding)
• Estonian Science Foundation (ESF) (approx 14)
• BUT - both evaluated on academic criteria, which
  provide no real incentives for researchers to be
  concerned about research applications

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Technology Push contd

• low university understanding of commercial
  relevance
• - the number of patent applications per 10,000
  inhabitants is 0.1, whereas the EU average is 2.5
• weak links to industry
• managerial and commercialisation skills in
  universities only starting to increase (Spinno
  programme)

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Market Pull

• only a small number of companies actively conduct
  in-house RD (ca 10 big and active companies,
  university spin-offs, some small technology
  companies)
• most companies do not have in-house RD but have
  the expertise and resources to commission
  research with universities and institutes,
  altogether ca 200 companies
• comparatively little state involvement so far in
  developing the in-house capacity of industry to
  conduct RD
• the concept of industry as developers of their
  own technology is underestimated

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Market Pull contd

• No innovation funding yet which is exclusive to
  industry all such funding is also accessible to
  universities
• Relatively efficient and competitive financial
  sector
• but venture capital not seed-phase/tech-orientated
  
• Above average performance on new enterprise
  creation
• but only limited pool of technology intensive
  start-ups

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Which way forward?

• Lot of efforts from science side directed to
  bridging the gap between universities and
  enterprises
• Modest demand of enterprises for RD financing,
  leading to conclusion that there is no scope for
  large increase in respective funds
• As a result, 5 out of 8 programmes have RD
  institutions as (one of the) target group
• Science pushed activities need to be
  complemented by more market pulled
  activities, where businesses and their needs
  drive the process

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Policy implications

• Creation of critical mass in RD projects and
  infrastructure funding crucial
• to be attractive as partners for business for
  applied research in universities and RD
  institutes
• Support for science base should also aim to
  increase number of ST (post)graduates
• indirect objective but research-industry mobility
  grants could increase appeal of scientific career
• NOT ALL COMPANIES NEED RESEARCH OR EVEN A HIGH
  LEVEL OF TECHNOLOGICAL COMPETENCE
• The purpose is to ensure that companies have the
  technology which is appropriate to their needs,
  not to push high technology solutions.

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Policy implications II

• Diffusion of knowledge/technology as much/more
  than creation should be the core focus
• technology transfer and adaptation
  (advice/training) also in companies from
  traditional industry sectors should be central
  plank of policy instruments
• need to stimulate foreign investment / export
  firms away from sub-contracting to higher value
  added production
• Capacity of firms to initiate, develop and manage
  RD and innovation projects
• access to skilled personnel (mobility) and
  raising competence is crucial

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• CONCLUSION - WHAT SHOULD HAPPEN NEXT?
• Only when you have companies which are
  technologically competent and active, they will
  interact with the RTDI system to seek services,
  graduates and technologies
• Fertilize cross-sector activities where science,
  technology development and innovation have a role
  to playthe real need for co-ordination
• Prioritization of sector specific co-operation
  and initiatives