National Nanomanufacturing Network: An OECD report released this month examines its member countries’ policy responses to the economic crisis in an effort to develop strategic approaches to stimulate the economy in the areas of finance, competition, and governance and to restore long-term growth.
The 37-page report, “Policy Responses to the Economic Crisis: Investing in Innovation for Long-Term Growth,” presents statistics in evidence of the broad negative impact that the current crisis has had on R&D investment, trade, and human capital—particularly in relation to high-risk, long-term innovations since 2008.
Although economic crises have historically led to industrial renewals, severe economic downturns such as this limit the creation of new businesses and innovations by reducing the amount of venture capital available and increasing the barriers to market entry, particularly for manufacturing firms.
To mitigate the negative effects of this hardship, the OECD recommends policies that share the risk of long-term investing with creative public and private partnerships, lower administrative and financial obstacles to entrepreneurship, support education and workforce training for emerging opportunities, and incentivize efficiency.
“This crisis can magnify the competitive advantage of research-intense firms who seize the opportunity to reinforce market leadership through increased spending on innovation and R&D.”