Transcript Human Capital and the Costs of Non

Human Capital and the Costs
of Non-Research
Alfonso Gambardella
Sant’Anna School of Advanced Studies
Pisa, Italy
Research policy - Incentives and Institutions
Ministry of Finance & Economics
Rome November 28, 2002
Topics
• Five stylised facts about research and
innovation in the 1990s
• Some intriguing indicators about Europe
and Italy
• Conclusions
Fact 1: Increase in Patent Applications
• US applications from  80k per year in the
1980s to 140-150k in the 1990s
• EPO: 143k applications in 2000. Up 16%
from previous year. Annual filings more
than doubled compared to 10 yrs ago.
• There is increase in the propensity to patent
(e.g semiconductors). Yet, notable increase
in innovations as well.
Fact 2: Markets for Technology
• Notable increase in technology transactions in the
1990s (patents, technologies, ideas)
• Implication: Innovators develop their technologies
even if they don’t have mfr or mkt assets
• The market is there:
– EPO estimated that in Europe 20 billion $ are spent
every year to develop innovations already developed
elsewhere
– Studies show that many companies (or patent holders)
are willing to license their patents
Fact 3: Human capital externalities
“Using detailed data on California
biotechnology, we find that … for an average
firm, five articles co-authored by academic
stars and the firm’s scientists imply about 5
more products in development, … and 860
more employees.” (Zucker, Darby,
Armstrong, 1998)
Fact 4: New industry & business models
• Information technology (and Silicon Valley)
have shown how to create development via
high-skill intensive business, new models of
firms and of economic relationships,
markets for technology, etc..
• This has potentials for development as well
(e.g. Bangalore, Ireland, Israel)
Fact 5: Openness
• Openness of science has been a major
example of the impact of openness of
performance in research and related
activities (e.g. Paul David’s work)
• A recent study shows that more “open”
European regions have higher labour
productivity, other things being equal.
To sum up …
• “People” are increasingly central to the
overall research and innovation business
• People are crucial to …
–
–
–
–
–
invent
manage
develop markets, institutions, and firms
create domestic and int’l networks
take strategic decisions and entrepreneurial
actions (whether in research or business)
– etc..
Some intriguing indicators
(just released EU Key S&T figures 2002)
• Show that European countries are enhancing
the role of “people” (HK)
• Italy is lagging behind. In particular:
– Italy has a good innovation and research
productivity;
– But the key inputs (number of researchers, scale
of HK) is dramatically modest
– Needs to increase the size of the HK base
Scientific Publications per 1000 Researchers in Govt or Academia
90
80
70
60
50
40
30
20
Source: My calculations on EU Key S&T Figures 2002
Portugal
Japan
Greece
Finland
Spain
France
Germany
Italy
Ireland
Belgium
Denmark
Sweden
Netherlands
Austria
United Kingdom
0
USA
10
Highly Cited Publications per 1000 Researchers in Govt
or Academia
60
50
40
30
20
Source: My calculations on EU Key S&T Figures 2002
Portugal
Greece
Japan
Spain
Finland
France
Italy
Austria
Belgium
Ireland
Denmark
Sweden
United Kingdom
Netherlands
USA
0
Germany
10
EPO Patents 2000 per 1000 Researchers in Business Firms
160
140
120
100
80
60
40
20
Source: My calculations on EU Key S&T Figures 2002
Portugal
Greece
Japan
USA
Ireland
Spain
United Kingdom
Belgium
Austria
France
Denmark
Sweden
Finland
Italy
Germany
Netherlands
0
Source: EU Key S&T Figures 2002
Italy
Greece
Portugal
Spain
Austria
Ireland
Netherlands
EU-15
United Kingdom
France
Germany
Denmark
Belgium
USA
Sweden
Japan
Finland
Researchers (FTE) per 1000 labour force: Latest available year
14
12
10
8
6
4
2
0
Researchers (FTE) per 1000 labour force: Annual growth from 1995
to the latest available year
12
10
8
6
4
2
0
Source: EU Key S&T Figures 2002
Italy
France
Germany
Japan
United Kingdom
EU-15
Denmark
Sweden
Netherlands
USA
Belgium
Portugal
Spain
Ireland
Finland
Greece
-2
EPO Patents 2000 and Researchers in Business Firms:
D, F, I, NL, UK
25000
20000
15000
10000
5000
0
Germany
France
Patents
Italy
Netherlands
Researchers in Firms
United Kingdom
New S&T PhDs per 1000 population aged 25-34, latest available year
1.4
1.2
1
0.8
0.6
0.4
0.2
Source: EU Key S&T Figures 2002
Italy
Greece
Japan
Portugal
Netherlands
Spain
USA
Denmark
Ireland
EU-15
Austria
Belgium
United Kingdom
France
Germany
Finland
Sweden
0
Source: EU Key S&T Figures 2002
Italy
Belgium
Japan
Portugal
Germany
EU-15
United Kingdom
Spain
France
Netherlands
Greece
Ireland
Austria
Denmark
Sweden
Finland
USA
Private & public expenditures on tertiary education, % of GDP in
1998
2.5
2
1.5
1
0.5
0
To sum up ...
• European countries with low share of HK
are trying to catch up
• Italy is an exception:
– Low supply of HK, in spite of the fact that
because of high productivity this is a valuable
investment to make!
– The logic is straightforward: Few PhDs, along
with modest expenditures on tertiary edu 
few researchers/HK  small research output
(patents or publications)
Conclusions
What are the costs of a low supply of HK?
“Using detailed data on California biotechnology,
we find that … for an average firm, five articles coauthored by academic stars and the firm’s scientists
imply about 5 more products in development, … and
860 more employees.” (Zucker, Darby, Armstrong,
1998)
What then? Increase the supply of PhDs!
• Develop high quality Doctoral Programmes
to:
– Implement a sound basis of research and HK
– Provide the teachers for the other levels of
tertiary education
• They could follow either a one-to-one,
apprentship-like “industrial PhD” approach
(e.g. in engineering); or an anglosaxon-like
PhD (with courses, etc.)
Supply of PhDs!
Most importantly, PhD programmes should be
managed by reputed researchers who have
experience with leading int’l PhD
programmes (and research), possibly within
independent or semi-independent institutions
 Create the “Graduate Schools”
“What are the research university?….
…. Those with a graduate programme.”