Kein Folientitel

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Bridging the technology gap within nations The
experience with the new Länder in Germany Dr.
Vivien LoFraunhofer Institute for Systems and
Innovation Research (ISI), Karlsruhe, Germany
Panel "Bridging the technology gap between
and within nations"UN Commission on Science and
Technology for Development10.-12. November 2005,
Rabat
page 1
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Overview

• The German situation after reunification
• Strengths and weaknesses of the East German
  innovation system
• New instruments Regionalized innovation policy
  and network support
• Lessons learned so far

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(1) The German situation after reunification

• 1990 Reunification of West and East Germany (old
  and new Länder counties)
• Restructuring of former socialist economic system
  in East Germany transition situation

Gross domestic product per employee in 1,000 Euro
(2002)
Source www.destatis.de
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Patents per 100,000 employees in industry (2000)
Necessity for a specific East German Innovation
Policy?

• 15 years after unification still two countries?

Patents per 100.000 employees in manufacturing
industry, 2000
200 to 600 100 to 200 50 to 100 0 to 50
Source Kulicke 2004
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(2) Strengths and weaknesses of the East German
innovation system
Few large scale enterprises
Relatively high RD capacity in public / private
research facilities
weaknesses
Small business structure
Higher tendency towards cooperation with
universities
Little intensity of innovation and RD efficiency
strengths
Lack of cooperation between enterprises
Comparatively high qualification
80-90 of RD-performing enterprises receive
public funding
Weakening of intensity of start-ups
Notable increase of rate of innovation in 2003
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Bridging the technology gap in the new Länder

Source Koschatzky/Lo 2005
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(3) New instruments Regionalized innovation
policy and network support
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Central Instrument InnoRegio (Innovative Regions
in East Germany)

• Funding 1999-2006 255 m Euro
• Goals Establishment of sustainable regional
  innovation networks in East Germany as a means
  for strengthening endogenous regional innovation
  potential
• Target groups Large Companies SMEs research
  institutes universities researchers graduates
  public authorities individuals
• Eligible Regional networks with a
  region-specific profile
• Instrument funding of network management and
  projects (product/service development mix of
  single and cooperative projects in education,
  research and economic activities)

Complex multi-actor-multi-measure program
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Central Instrument InnoRegio (Innovative Regions
in East Germany)

• Competition in three stages
• (1) Qualification call for ideas for regional
  activities, 444 responses (1999) 25 regions
  selected
• (2) Development 25 regions develop concepts and
  projects
• (3) Realisation 23 of the 25 selected for
  financial support until 2006
• Impact so far
• Increase in innovation activities (2/5 of firms
  have patented in the last two years, almost all
  have introduced new products)
• 50 new firms since 2000
• sustainability of regional networks as yet
  unclear
• wide impact to network formation
• on-going evaluation / scientific monitoring on
  InnoRegio's development

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(4) Lessons learned so far
Positive developments of innovation activities in
East Germany

• RD expenditures in East Germany from 1996 to
  2003 almost doubled
• RD expenditures growth 2003 8 (manufacturing
  industry 14)
• Total revenue growth 2004 6.5 (9.4 for
  continuously RD conducting businesses)
  productivity 9
• Export volume growth (for continuous RD
  conducting businesses) 7.4
• Innovation intensity in East Germany higher than
  in West Germany (e.g.manufacturing industry East
  5.7 ?? West 4.9)

Source EuroNorm 2005, ZEW 2005
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New policy elements and lessons learned so far

• New Elements
• Support of networks
• Competitive element in support programs
• Increased focus on regions (reinforcement of
  regional development dynamics, bottom-up
  approach, endogenous potential)
• Shift of focus to networks and regions
  experimental policy approaches seem to be
  successful step
• Yet, despite first good signs, still difficult
  situation in the new Bundesländer
• Increasing significance of innovation policy for
  the development of East Germany

Recognition of regionally different paths of
development and growth Realization of length of
time period necessary for transformation