Closing the Innovation Gap
By admin August 17, 2016

(Image: REUTERS/ Akintunde Akinleve)

In a recent report, the United Nations World Intellectual Property Organization (WIPO) has shown that a middle-income country, China, has joined developed economies as a global leader of innovation. China, however, is an aberration. A large “innovation divide” still persists between developed and developing countries. For instance, the most innovative countries, led by Switzerland, Sweden, the United Kingdom, the United States and Finland, tend to have developed economic, social and legal structures that supports and encourage innovation in both the private and public sector. Sub-Saharan Africa, on the other hand, is lagging behind, with Mauritius taking the top spot among countries in the region, ranking as 53rd in most innovative in the world. Despite the divide, sub-Saharan Africa fosters the most amounts of countries that perform better than their development would suggest, including Kenya, Madagascar, Malawi, Mozambique, Rwanda and Uganda. This momentum will be important in moving all of Africa forward.

The innovation gap can be accounted for by the intrinsic market-based characteristic of innovation. The incentive to invest in innovation is very dependent of the scope of markets. For instance, in the private sector, research and development is a fixed cost and will often be dependent on overall company sales and profit. If the economy is poor, then it is likely that research and development will not be at the forefront. Similar to private sector innovation, innovation in the public sector is highly dependent on government input and use. In general, demand to innovate is low in developing countries, but the low supply of available funds directed for research and development is low as well. Low demand and supply for research and development may be attributed to prioritization of provision of public goods – including public health facilities, basic education and environmental protection. Moreover, the lack of intellectual players due to brain drain is also pervasive. Because impoverished countries do not hold the resources to retain potential innovators, they do not reap the benefits of those innovations.

There are several steps that can be taken to close the innovation gap. First, top economies should create a shared global innovation agenda that aims to reduce global poverty. This can include partnerships in collaborative research and development in important global issues including food security and climate change. Second, governments and contributing organizations should be able to facilitate technology diffusion and adaptation, like training and mentoring programs, so that solutions are scalable for local entrepreneurs. Next, effective mechanisms to increase the flow of skilled individuals and knowledge to impoverished nations are needed to combat the emigration of human capital.  Fourth, governments will need to strengthen intellectual property rights to provide incentive for the private sector to invest in innovation and technology. This will also consider the cost of imitation and policy implementation. Lastly, nations will need to enhance innovation efficiency and innovation connection to markets. Increasing expenditure on research is not enough. Gaps in innovation systems need to be evaluated and targeting interventions that improve the outputs of investments will be important as well. Closing the innovation gap is crucial to building a stronger global economy and closing the wealth gap.


For more information:

‘Innovation divide’ persists; investment crucial to vibrant competitive economy, says UN agency

5 ways to close the global innovation divide

The Global Innovation Divide

The Global Innovation Index 2016

The Digital Innovation Divide


Thanks for sharing !

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