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Information about Uvalic

Published on March 18, 2008

Author: AscotEdu

Source: authorstream.com

Science, Technology and Economic Development in South Eastern Europe:  Science, Technology and Economic Development in South Eastern Europe Milica Uvalic University of Perugia UNESCO Conference Ljubljana, 28 & 29 September 2006 Introduction:  Introduction Why invest in science in SEE? Comparative overview of the situation in the S&T sector in Southeast Europe (SEE) [2 studies prepared in 2005: UNESCO, Slovenian Ministry for HEST(SEE-ERA.NET)] SEE: 6 “western Balkan” countries: Albania, BiH, Croatia, FYR of Macedonia, Montenegro, Serbia (excl. Kosovo) Issues:  Issues 1.Economic constraints on S&T in SEE 2.National systems of S&T in SEE (1) National policies (2) Investment in R&D (3) Infrastructure (4) Human resources (5) S&T output (patents, publications) 3.Why invest in science in SEE? 4.Policy recommendations 1.Economic constraints:  1.Economic constraints 1989: Transition in SEE, but break-up of Yugoslavia (mid-’91)  Political: 5 military conflicts, UN/EU sanctions, international isolation… Economic: hyperinflation, very deep recession (drop of GDP of 80% in 3 years…) Delayed transition and integration with EU Long-lasting consequences for SEE Cs Present economic features: pose severe constraints on development of S&T Economic constraints…:  Economic constraints… Low level of development: Slow recovery after deep recession and recurrent crises 2000 onwards: high growth rates, but slow process of catching up, some Cs still at 55-60% of 1989 GDP (Serbia, B&H) 2004: most SEE Cs GDP/head (market exchange rates) US$ 2000-3000 (20-32% of EU-25) Exception: Croatia almost US$7,000 (46% EU-25) 2004 GDP per capita (US$) at market exch rates and PPP:  2004 GDP per capita (US$) at market exch rates and PPP Economic constraints…:  Economic constraints… Budgetary constraints posed by restrictive economic policies  severe cuts in public expenditure (also R&D, education…) External accounts deficits: non-diversified exports (labour-intensive goods), dependence on imported technology National savings & investment low Limited FDI: 1989-2002: SEE-5 attracted only 6.1% of total FDI in 27 transition Cs FDI picking up only recently, yet… FDI, 2000-5 (billion US$) SEE-5: annual FDI still under US$ 5 billion:  FDI, 2000-5 (billion US$) SEE-5: annual FDI still under US$ 5 billion 2.National systems of S&T:  2.National systems of S&T Historical background: Starting conditions in 1989 very different More favourable in SFR Yugoslavia: institutions, human capital, Universities (Zagreb 1669, Belgrade 1889), openness (intern coop, scientific exchange, travel…) Albania: traditional model, most closed economy, first University set up in 1957 Important still today (institutions!) (1) National policies ...:  (1) National policies ... Reforms in course in all SEE Cs, also in S&T and Higher Education (at variable speed) New laws on Science in all Cs (+ HE), various government documents, drafting of national strategies Yet, delays in implementing changes/laws S&T in the shadow of other priorities, lack of understanding of the importance of science National policies…:  National policies… Reforms  Major institutional differences BiH: highly fragmented and decentralised system (no R&D policy at state level) Serbia: R&D decentralised, separate S&T and HE institutions & government policies Montenegro: more centralised Croatia: very centralised - one law for R&D & HE + recent merging of the 2 Ministries National policies…:  National policies… National strategies and key priorities Government documents  define programs, specific tasks, multiple objectives… Still, in most Cs: no clear orientation regarding priorities (basic/applied research) No clear and realistic longer-term national strategy on R&D (innovation Vs. imitation) (2)Investment in R&D:  (2)Investment in R&D Economic constraints (heritage of the 1990s)  science/R&D/HE: poorly funded R&D expenditure generally low, but no data for Albania, BiH, Montenegro; for Serbia partial (only government spending) Government: prevalent source of finance Industry funds limited, also due to delays in privatisation (S&M, BiH: private sector share 55% of GDP), limited links with universities Gross domestic expenditure on R&D, % GDP (GERD): 2003:  Gross domestic expenditure on R&D, % GDP (GERD): 2003 Croatia: GERD highest - 1.14% of GDP, higher than in most new EU member states (exc. Czech Rep, Slovenia), even old (Italy) Serbia: government expenditure: 0.32% of GDP, but continuously rising - plans to increase R&D spending to 1.4% by 2010 Maced: GERD even lower: 0.22% of GDP BiH: GERD estimated at 0.03-0.05% of GDP Albania, Montenegro: no data on GERD Gross domestic expenditure on R&D (% GDP), 2000-3:  Gross domestic expenditure on R&D (% GDP), 2000-3 GERD financed by industry? :  GERD financed by industry? Business enterprises R&D spending (as share of total): [in 2004-5 data provided by only 2 Cs] Croatia: almost 40% of total (2003) FYR Macedonia: only 12% of total (2003) Substantially less than the average for EU-15 (in 2003: 54.6%) (3)Infrastructure:  (3)Infrastructure Poor financial situation of R&D institutions in SEE  limited possibilities to modernise scientific infrastructure (purchase new equipment, modernise laboratories, libraries, ICT systems, Internet access, data bases) Still, big differences, richer countries (Croatia) better off Generally, inappropriate treatment of R&D  serious obstacle for more intensive research (4)Human resources:  (4)Human resources Break-up of SFRY, wars, economic crises (1990s)  dramatic effects for all Cs (1) Massive & continued brain drain (loss of best experts) (2) Brain “waste”: leaving R&D professions for more profitable jobs (private or informal sector) R&D professions unattractive: low pay, no social status, no employment opportunities  no incentives Human resources...:  Human resources... Dramatic proportions of brain-drain Tirana University lost 40% of its academic staff in the 1990s (90% under 40 years old) Massive brain-drain also from BiH, Mac, Serbia, Kosovo (estimates vary) Departure of best experts, deficit of researchers of middle age generation Human resources...:  Human resources... Early 1990s: general tendency of decreasing number of researchers in all countries Since 1997, trends on R&D personnel extremely variable Albania, Croatia: number of researchers & scientists increasing Macedonia, Serbia: number of researchers stagnating or declining BiH: no statistics on total R&D personnel (only on professors) (5) S&T output:  (5) S&T output Upward trends in technological and scientific output in most SEE Cs [But for Albania & BiH: no data on R&D output, no Patent offices] Patents: In most Cs the number of patents recently increasing Scientific publications: Generally increasing, but associated with various problems, general and specific Scientific output:  Scientific output General problems: evaluation methods, non-existence of single databases, some fields (engineering) difficult to evaluate Specific problems in SEE: years of isolation, non-inclusion of national journals into intern. data bases, limited international exchange… Recently all SEE Cs  improvement of systems of evaluation of scientific output … 3.Why invest in science?:  3.Why invest in science? Overview Poor conditions of the S&T sector in SEE countries Theory: from Schumpeter onwards, innovation as driver of economic growth Modern growth theory Romer (1990): Technological progress as endogenous factor of growth, result of R&D Aghion and Howitt (1992): competition in R&D driving force of growth Grossman and Helpman (1993): innovation as the direct effect of R&D investments Why invest in science in SEE?:  Why invest in science in SEE? Empirical evidence: importance of innovation for growth (e.g. Brasil, India) What drives innovation? GDP levels, trade, human capital, government spending, protection of intellectual property rights… Recent empirical study (Trumbic 2006): The most significant variables for OECD countries: R&D spending and education For non OECD countries: GDP per capita levels and investments in R&D Why invest in science in SEE?:  Why invest in science in SEE? In EU: R&D perceived as a key resource for competitiveness and long-term growth Transition to a knowledge-based economy Lisbon & Barcelona European Councils R&D spending  3% of GDP by 2010 Industry-financed R&D  2/3 of total European Research & Higher Education Areas Innovation and information technologies… Highly relevant for SEE Cs aspiring to join EU (though only Croatia negotiating EU entry…) 4.Policy implications:  4.Policy implications S&T sector in SEE: progress in recent years, but a lot more could be done More appropriate policies needed to prevent an increase in the S&T gap between the SEE Cs and more developed countries National policies International Policy implications:  Policy implications National policies Raise public awareness about the knowledge-based economy (key role of innovation and technological progress) Change present inappropriate treatment of R&D (marginalisation of science) Increase expenditure on R&D Facilitate links between industry and universities, encourage networks  Government measures needed in all areas Policy implications:  Policy implications Right balance between restrictive macroeconomic policies & those with long-term effects (competitiveness) investing in human capital, education, life-long training, requalifications Attract more FDI, by further improving business environment, decreasing country risk Improve statistics (data collection) Policy implications:  Policy implications International Constant renewal of links of SEE Cs since 2000 (international, regional, bilateral donors support), results clearly positive for S&T: Participation of SEE Cs in EU 5th, 6th, 7th FP, COST, EUREKA, TEMPUS, gradual integration into European Research Area Regional networks in R&D (?) International assistance in S&T remains important in the medium run - much more could be done Policy implications:  Policy implications Making all SEE Cs eligible for EU programs reserved for candidates (as recently done with e.g. EIB’s Innovation 2000 Initiative) Still today: limited funds for longer-term research, or researchers mobility Donors aid often short-term, no interest to invest in certain key areas (S&T infrastructure, modernisation of laboratories) Better matching of donors financial assistance & national priorities Policy implications:  Policy implications Longer-term strategy on S&T in SEE, also in a regional context Each SEE country: innovation Vs. imitation Potential for innovation and specialisation in specific sectors Desirability of transferring technology from abroad (also through FDI) in other sectors Importance of international support in this regard (learning from western experience)

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