Government, Innovation and Technology Policy

Government, Innovation and Technology Policy

An International Comparative Analysis

New Horizons in the Economics of Innovation series

Sunil Mani

This unique book offers a comprehensive analysis of the changing role of government with respect to domestic technology development in eight countries in both the developed and the developing world. The author distinguishes between those countries which can be classed as creators of new technologies (Japan, Korea and Israel) and those which possess the potential to create new technologies (Singapore, Malaysia, India, South Africa and Brazil).

Chapter 9: Working with the Market: Israel’s Experience with Research Grants

Sunil Mani

Subjects: economics and finance, economics of innovation, innovation and technology, economics of innovation, innovation policy


9. Working with the market: Israel’s experience with research grants Our analysis thus far has shown that research grants have become an integral component of the government’s innovation policy in a number of developing and indeed even developed countries. It will thus be instructive to analyse the experience of a successful country that has effectively used grants as a way of promoting innovation. Such an exercise is very likely to throw up a number of lessons for the other developing countries, which have the potential to create new technologies on their own. Accordingly, we shall examine the case of Israel, which is one of the most technologically developed countries in the world. Israel’s main asset is its very talented and highly educated human resources. Its innovation system is also peculiar in the sense that it benefited from a ready supply of highly trained scientists and engineers who migrated to the newly formed state from Western Europe and from the former Soviet Union. This has made the country a technologically dynamic one within a short period of time. (See Table 9.1.) Table 9.1 Indicator 1. R&D intensity as a per cent of GDP (1999) 2. R&D per capita index, 1996 (USAϭ100) 3. Number of patents taken out in the USA by inventors from Israel (1963–2000) 4. Percentage share of high-tech exports Indicators of technological dynamism Value 3.6 (2.1) 66.7 8,161 (3,081,418) 20 (33) Note: Figures in parentheses indicate the respective data for...

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