The two days training workshop (TW) on Technology, Growth and Productivity, including KET covered a wide of range of theoretical, empirical and policy issues related to interaction of technology and productivity. The topic was investigated and discussed in four perspectives:
1. The macroeconomic perspective of growth and development;
2. The firm-level perspective of analyzing panel data;
3. The key-enabling-technologies and policy
4. Regional innovation and R&D policy of Croatia
The first part of the workshop took a macroeconomic growth orientation (T. Ziesemer).
(i) In a review of some descriptive and econometric evidence on the link between human capital and growth tertiary education was shown to reduce educational inequality and strengthen growth for a panel of 144 countries.
(ii) An empirical open economy growth model with estimation for Croatia in the presence of imported capital goods showed that tertiary education in Croatia has a positive impact on productivity directly and indirectly via R&D expenditures and the number of researchers. Moreover, world income growth leads to higher exports with an income elasticity of almost two, enhancing imports of machinery and transport equipment (SITC 7) which in turn strengthens growth of the GDP per capita.
(iii) However, under the conditions of the past all these favourable effects enhance foreign debt for Croatia. This debt partly comes in the form of foreign direct investment which may enhance employment but also discourages tertiary education.
The second half of the first day, three papers provided evidence based on firm level panel data analysis in the context of Croatia, addressing the topics of Information technology (Škrinjarić), consequences of the war for firm growth (Tkalec), and creativity & innovation (Stojčić, N., Hashi, I., Aralica, Z.,). We concluded the first day with discussing challenges in doing scientific and relevant research for economic development in Croatia. In the past the main obstacle was lack of data, whereas in current time the main challenge how to include institutions into the research agenda related to economic development.
The second day continued at the micro-level (the second part). A literature survey on determinants of productivity growth highlighted the heterogeneity in firms’ capabilities and the importance of different sources of technological upgrading. Special attention was paid to the impacts and returns of R&D and innovation. The role and rationale of public policy in supporting R&D and innovation in firms were discussed through a framework that distinguishes between policies providing public inputs or market incentives, and those targeting predefined sectors and firms or with (potential) universal coverage. Among the latter, empirical evidence from industrialized economies and implementation issues were presented regarding publicly executed R&D, indirect support to R&D (tax incentives) and direct support to innovation activities (grants and subsidies).The diversity of constraints faced by Croatian firms and the challenges on the side of policy design and implementation emphasize the need to find a ‘better’ policy mix. (Vargas). The international dimension of productivity and technology diffusion were emphasized by considering the potential gains from FDI and international spillovers (Stojčić, N., Orlić, E.,).
Strategies to advance manufacturing were discussed. A survey of globally available key-enabling- technologies (KET) added the global dimension to the workshop. Since Croatia cannot excel in each and every technology domain, it has to set priorities for the future. Technologies which can be best applied and deployed in Croatia are most useful. The prioritized R&D policy domains should be complemented with demand-side policies. Examples have been presented of: innovation strategies and policy instruments to advance manufacturing; how to study the ‘key enabling’ role of technological domains. Since markets and governments may fail to predict which technology strategy would be best for the future, it should be discussed, designed, implemented and evaluated in a systemic way involving a variety of stakeholders (e.g. research organizations, firms, policymakers, agencies, communities).
Finally regional and national policy cases were discussed. A regional policy project report on simultaneous intermediation of rural talent supply, urban high-tech labour demand and adjustment of the school curriculum was presented (M. Čelan). The question how to improve Croatia’s national R&D policy linked back to the macroeconomic start of the work shop. Croatia’s R&D expenditures as a share of GDP is lower than that of many middle income countries although Croatia is a high-income country. The last presentation (Ramljak) presented suggestions for improving innovation policy in Croatia. These suggestions are: 1) Public and private sector should be connected and harmonized in terms of S3 implementation; 2) A set of policy measures should be harmonized with innovation value chain and 3) More ambitious plans related design and implementation of S3 in the future (stronger foreseen leverage effects).
The second day was rounded off by lively panel discussion on future research and policies under the inspiring guidance of the discussion leader (Zoran Aralica). Increasing coordination between public and private sector emerged as a clear challenge for the near future.
Training Workshop programme can be seen here.