The World Bank ECAKE Human Capital policy issues for LAC Washington, June18, 2003

The World Bank Challenge...

Human Capital University Think Tanks/ Antenna Firms Innovation & TFP Growth The FPSI Challenge : Other Public Policies Rules of the Game Infrastructure (ICT) Demand for innovation Global Knowledge Economy National Innovation System Innovation Clusters Global Knowledge Economy

The World Bank Knowledge Market l the knowledge market is global and open, –knowledge producers exchange knowledge at “low price” –knowledge users have access at “high price” l knowledge is not consumed when it is applied

The World Bank Closing the gap l Skilled people l Knowledge networks and centes of excellence l Creation and transformation of knowledge l Strengthening of culture and language l Information infrastructure l National Information System

The World Bank Lessons...

The World Bank l Knowledge is a critical determinant of economic growth and quality of life l Knowledge is transformed into goods and services through a country’s NIS l Trained human brains are the most effective knowledge transfer and adaptation mechanism l Good science is international

The World Bank Trends...

The World Bank PIB Crecimiento (%) Nota: tasa de crecimiento anual basados en US$ de1995 Fuente: World Development Indicators 2002

The World Bank Increased Returns to Schooling (Brazil)

The World Bank Accelerated Enrolment in LAC Source: World Development Indicators (WDI);

The World Bank Científicos e Ingenieros 1988 y 1998 Fuente: World Development Indicators 2002

The World Bank Tertiary- Ok given level of GDP but... Fuente: Brunner 2001 Ph.D.s en Ciencia/millón hab

The World Bank Cost per Student (average for short and long cycle programs)

The World Bank Increased Private Sector Response

The World Bank Demand and GNP (Colombia)

The World Bank.. an Equity Challenge ( Colombia and 1997)

The World Bank Estudiantes extranjeros en países OCDE, según orígen, 1999

The World Bank Closing the Gaps in Education and Technology: LA vs. Asia & Scandinavia

The World Bank NIS …

Human Capital University Think Tanks/ Antenna Firms Innovation & TFP Growth The FPSI Challenge : Other Public Policies Rules of the Game Infrastructure (ICT) Demand for innovation Global Knowledge Economy National Innovation System Innovation Clusters Global Knowledge Economy

The World Bank WB Education Portfolio in LAC 2002

The World Bank Tertiary Education in LAC

The World Bank Promoting Innovative Effort l How create a taste for innovation? –Consortia in Asia, Finland –Repatriation of talent –Students in industry –Management training l Nurturing innovation-Seedlings –Precompetitive financing? (new Nordic research) –Matching grants: (50% of Tekes financing) –Industrial Parks/Incubators: Filter for new ideas

The World Bank Promoting Innovative Effort II l Encourage collaboration: –Matching grants F 50% Tekes financing in sectoral programs F Why didn’t work in Mexico? –Overhaul University/Think tank incentives (HD/FPSI) –Industrial Parks/Incubators: Impact in the region? l Financing, Managing new innovation –Venture management/ capital (Yozma) –SME appropriate financing (barrier to R&D in Fin.)

The World Bank Promoting Innovative Effort III l Providing science public goods –Overhaul public think tanks (FPSI) F VTT –Consolidation/low base financing –Reform Universities (HD) –Introducing new sectors- Fundacion Chile (Mexico?) l NIS overview –NIS management –Cluster analysis (Fin: 4 year cycle) –Technology forecasting? –Tight checks and balances (Tekes, Academy 3 year review, projects outside)

The World Bank Thanks for the Invitation Lauritz B. Holm-Nielsen