They focus policy support and investments on key national/regional priorities, challenges and needs for knowledge-based development, including ICT-related measures
private sector investment ï¿They get stakeholders fully involved and encourage innovation and experimentation ï¿
growth, as an important innovation effort and considerable investment is required to shift towards a resource-efficient and low carbon economy, offering opportunities in domestic and
not only investment in research or the manufacturing sector, but also building competitiveness through design and creative industries
and knowledge-based investments that are most likely to deliver growth and jobs in the regions.
public investments and supports countries and regions in strengthening their innovation capacity while focusing scarce human and financial resources in a few globally competitive areas in order
internal R&d investment, which is aimed not only at implementing available technologies but also at exploring recent advances in areas of nanotechnology and biotechnology
'blind'duplication of investments in other European regions. Such blind duplication of efforts could lead to excessive fragmentation, loss of synergy potential,
selective investments in future-oriented domains with a high innovation and growth potential and large societal impact.
specialisation of R&d investment, publications and citations, and patent applications and citations by'field'.'A region has a comparative advantage in a certain field
public investment in research/education/innovation in the region (by all levels of government predictability of the innovation policy framework for regional stakeholders;
Favourable conditions for equity investment, business angels and venture capitalists business environment favourable to the creation of new SMES;
stability of public investment in research, education and innovation; proper balance between institutional and competitive funding for innovation;
should be seen as an investment rather than a burden The most important types of organisation that need to be involved in the RIS3 process are public
This includes private investments, as one explicit goal of RIS3, included in the criteria for the conditionality, is to leverage private RTD investments
If such an analysis has not yet been initiated, RIS3 presents an opportunity to do so and will
investments that have the potentially highest impact on the regional economy. The priority setting for national and/or regional research and innovation strategies for smart specialisation
channelling resources towards investments with a potentially higher impact on the regional economy. The distinctive elements that can guide review, monitoring and
improving their investment in R&d, facilitating innovation and promoting entrepreneurship. Cohesion Policy in fact provides the largest financial
aggregate European investment of more than EUR 100 billion. Some 50,000 researchers a year use them to produce 3, 000 to 6,
and avoid duplication of investment in infrastructures similar to those already in place nearby How to act
Investments in existing and new RIS should combine in the most efficient and effective way the instruments and funds available (e g. taking into account the
For the next programming period, the investment's priorities proposed under the Cohesion Policy cover these aspects with an emphasis on connecting universities
and/or relevant investments •Studies and investments associated with the maintenance, restoration and upgrading of the cultural and natural heritage of villages and rural
landscapes, including related socioeconomic aspects •Co-operation among different actors in the Union, agriculture, food chain
austerity or trying to create the conditions to attract new investment, the smart specialisation strategy builds on or constitutes the first step towards local/regional
planning of these investments. This is as much a socioeconomic as a cultural and political challenge which management authorities of EU funds cannot afford to
Europe is facing an investment challenge in the financing of high speed internet infrastructure because the benefits for society as a whole appear to be much
The large amount of investment required to achieve ubiquitous coverage80 requires a combined effort from a large number of investors from the
private and public domains, the adoption of open and long-term investment models81 and the use of a range of financial tools including grants and financial
financing and investments in innovation and improved coordination and coherence between funding for research and innovation at European, national and
as well as ensuring investment in digital service infrastructures (trans-European high speed backbone connections for public administrations, cross-border delivery of egovernment services, enabling
for management authorities is therefore to select investment models and strategic priorities that will foster the above efforts
generation networks (over 30 Mbps), assessing the most suitable investment models, 89 etc. This may take the form of a stand-alone'Broadband Plan'(most
Notably the Guide to Broadband investment http://ec. europa. eu/regional policy/sources/docgener/presenta/broadband2011/broadband2011 en
strategy will enable regions to identify the priorities for ICT investment which are pertinent to your territory.
investment models; to exploit pre-commercial procurement and other related innovative procurement activities including reinforcing cross border and
The Guide to Broadband Investment, presenting the various models for management authorities wishing to invest in high speed infrastructure,
Provided that these investments respect the relevant regulation telecom framework, State aid guidelines, etc. they can benefit from a wide range
Broadband Investment as well as specific assistance through a range of training modules, workshops and training events
The EBP will also continue to work on the guide on broadband investment models with the provision of additional models and with the evaluation of the impact of
Commission in the proposal for the new Cohesion Policy as one of the investment priorities of the European Regional Development Fund (ERDF) as a relevant
investment for the smart growth of regions. 94 KETS are seen as the route to new and better products and processes, capable of
Investment Bank in order to provide loan guarantees to productive investments Overall, a coherent financial framework will be put in place
In many cities and regions, including rural areas across Europe, investments in cultural and creative industries (CCIS) already have a significant impact on smart
investments. These positive impacts are highlighted in different EU policy documents and studies. 102 Barriers and challenges
activities, their lack of investment-readiness, as well as the insufficient investor -readiness of financial institutions to support them
are invited to finance their cultural and creative industries through investment priorities103 closely linked to the objectives of the EU 2020 Strategy
Strategic and inclusive approach to investments and the use of financial resources •Streamline regional,
funds to co-finance investments in the cultural and creative sectors, in conjunction with the financial instrument that is proposed under the Creative
investment in this field •Further exploit links between the CCIS and other important policy areas for
•Promote investments in the protection, promotion and development of cultural heritage. 109 Other investments could include:
the development and use of new information technologies (for example to promote the digitisation of cultural heritage), strengthening of entrepreneurship in CCIS
training issues) investment should equally be encouraged 94 Internationalisation Why should internationalisation be part of smart specialisation
as loans, guarantees and equity investment for SMES. In the 2007-2013 financial framework a new generation of financial instruments was put in place in
in order to deliver investments in projects which demonstrate appropriate repayment capacity in situations of market imperfection.
which will be ring-fenced for investments in line with the programmes concerned, for example, a guarantee facility is being
European Investment Bank (EIB), the European Investment Fund (EIF) and the Council of europe Development Bank (CEB) which promoted the implementation
SMES in order to support the investments of such companies in innovation activities, including eco-innovation. The High Growth and Innovative SME
fund for infrastructure investments in the transport, energy and renewable sectors. The Fund was established as a regulated, specialised investment
vehicle under Luxembourg law. The Commission, representing the EU, has a seat on the Supervisory Board responsible for setting the overall strategy
or in individual investment decisions, as this is the responsibility of the Management Board and Investment Committee of the Fund. 114 Policy DG in
charge: DG ECFIN, with participation of DG MOVE and DG ENER EU level debt instruments (guarantees/risk sharing:
research and innovation investments by sharing the underlying risks between the EU and the EIB.
SMEG is operated by the European Investment Fund (EIF) on behalf of the Commission (representing the EU). 116 Policy DG in charge:
of equity, loans, guarantees or other forms of repayable investments in enterprises, mainly SMES, public private partnerships, urban development
or in legal or natural persons carrying out specific investment activities in energy efficiency and renewable energies.
Policy (DG REGIO) developed together with the European Investment Fund in order to promote the use of financial engineering instruments to improve
Joint European Support for Sustainable Investment in City Areas is a joint initiative of the European commission's Directorate General for
natural persons carrying out specific investment activities in rural areas, in accordance with the relevant rural development programmes.
The European Investment Bank is the long-term financing institution of the European union and its mission is to help implement the EU's policy objectives
investment programmes or projects costing less than EUR 25 million Micro-finance has also been provided by the EIB in some countries
The European Investment Fund provides financial intermediaries an integrated risk finance product range of SME finance initiatives, complementing the
•Higher impact of innovation investments thanks to a comprehensive strategy that combines R&d investments (e g. in eco-innovation) with purchasing
innovations (e g. of energy efficient and low carbon buildings or transport •Higher mobilisation effect on private investors/venture capital, thanks to the
and return-on-investment for innovative firms Barriers and challenges The main reasons why still too few public procurers in the EU buy innovations
procurements are mostly too small for companies to make investments in innovations worthwhile. There are hardly any mechanisms to allow the
The ERDF permits the strategic combination of investments in R&d&i capacity -building with demand-side measures in a unique manner.
public investments in key areas for sustainable growth and innovation such as energy, environment, transport, land-use, education or social services.
through thematic objectives, investment priorities, and also as a crosscutting principle. The proposed regulations include concrete ex-ante conditionality
policy has also reinforced its contribution for the energy investments Yet, achieving the EU's 20-20-20 objectives on greenhouse gas emissions, energy
The European Social Fund (ESF) has made significant investments in social innovations, ranging from supporting local partnership
http://ec. europa. eu/internal market/investment/docs/social investment/20111207proposal en. pdf 170 www. socialinnovationeurope. eu 115
4. 4 Does the document outline measures to stimulate private R&d&i investments for instance through public-private partnerships?
9†Assessing the Investment Potential of SMES Emerging from Phase I of the SME Instrument 33
growth, and create high return on investment. The SME instrument addresses all types of innovative SMES so as to be able to promote growth champions in all sectors
2 to increase the return in investment in innovation activities. The proposal should contain an
ï Increase of private investment in innovation, notably leverage of private co -investor and/or follow-up investments
ï The expected impact should be described clearly in qualitative and quantitative terms (e g. on turnover, employment, market seize, IP management, sales, return on
investment and profit Type of action: SME Instrument The conditions related to this common call are provided below and in the General Annexes
follow-up investments ï Contribute to regional smart specialisation strategies by capitalising upon concentrated and complementary competences for the development of new industrial value chains
9†Assessing the Investment Potential of SMES Emerging from Phase I of the SME Instrument
This action will establish a group of investment specialists, operating in a personal capacity to assess the investment potential of SMES emerging from Phase I of the SME Instrument
28 The work of the expert group will be essential to get a better overview of the investment
-readiness landscape in Europe, to ensure that entrepreneurs are prepared better to negotiate effectively with potential investors, to increase the number of investments made into early
-stage firms and to ensure a greater commercialisation of scientific knowledge in Europe The experts concerned will be qualified highly, with specialist expertise in the field of
This action is linked to an investment readiness measure (Call H2020-BIR-2014 in the Access
This tangible investment in a healthy, competitive European economy is every bit as important as our commitment to
Investment in research and innovation has a powerful multiplier effect, especially at the European level.
The European commission and the European Investment Bank Group are also working together to help innovative SMES access finance from commercial banks
Direct investment remains vital as well, and Horizon 2020 will be the biggest EU research and innovation programme ever
is an investment in our health as it will keep older people active and independent for longer, it will support the
The return on this investment will include new ways to prevent disease, better diagnostics and more effective
telecommunications, and mobile telecommunications investment, in both developed and developing countries. 2 At the level of the firm, World bank surveys of approximately 50 developing countries suggest that
and infrastructure investments †a recipe of interdependent ingredients which promotes initiative and innovation. †6 To fulfill their potential,
the private sector arm of the World bank, in its Investment Climate Surveys and Doing Business reports.
business investment and innovation †Intel†s low-cost devices and Wimax technology for rural connectivity
and stability required for business investment and planning. Competing interests among telecommunications regulators and import/export commissions around tariff and non-tariff barriers
In the context of a systemic challenge, collective investment and collaborative implementation can be some of
kinds of â€oereturn on investment, †whether financial, social, environmental, or some combination of the three
with companies in agribusiness, manufacturing, mining, tourism to provide the investment capital their SME partners need to upgrade, diversify, and scale.
commercial, profit-oriented, business investment approach. Vodafone is a multinational company that entered the m-transactions business in Kenya with its local affiliate, Safaricom, using more of a business experiment approach
The UK€ s Department for International Development (Dfid) matched Vodafone†s investment, reducing its risk
and it makes significant investments in them. Microsoft†s Enterprise Partner Group provides established partners with continuing education, marketing,
while considered business investments, do not generate direct revenues for Microsoft Results There are currently 110 Microsoft Innovation Centers in 60 countries worldwide. 75 The company aims to open an
PTAS are measured also according to conventional business metrics such as return on investment ROI) and revenues. Measures of satisfaction among partners and citizens are monitored as well
Drivers for international economic growth and development †offering equity investments, loans, and technical assistance for entrepreneurs and existing companies seeking to establish
more mainstream investments succeed. To receive competitive financing, IFC€ s clients are challenged to increase procurement from local firms as a mechanism to grow the SME
Building upon initial investment by IFC, IBM has invested nearly $2 million in rebuilding the SME Toolkit
technology platform and will continue its investment in 2008 Results Because the SME Toolkit is a freely available online platform,
•improving the investment climate •building government capacity •empowering civil society and other actors103
ICT Investment in OECD Countries and its Economic Impacts. Paris Organisation for Economic Co-operation and Development.
Nweke, Remmy. 2007. â€oeceltel Targets N379bn Investment. †Daily Champion, Lagos, Nigeria, August 29 36. Figures from ITC Limited. n d. ITC Limited. http://www. itcportal. com
Virgin Unite. n d. †Good†Investments http://www. virginunite. com/view content. phtml? id=79 (accessed
ICT Investment in OECD Countries and its Economic Impacts. Paris: Organisation for Economic Co -operation and Development
Nweke, Remmy. 2007. â€oeceltel Targets N379bn Investment. †Daily Champion Lagos, Nigeria, August 29 One Laptop Per Child. n d. One Laptop Per Child Website. http://laptop. org
Virgin Unite. n d. †Good†Investments http://www. virginunite. com/view content. phtml? id=79 (accessed
technology policy and investment marketing in the region, the Technology and Marketing Corporation in Linz.
the co-funding of investments, followed by the co-fund -ing of personnel. As far as the co-funding of external
investments Funding of personnel 50.7 54.2 Funding of external 31.3 33.3 consulting services Provision of technical 18.2
schemes which aim more at investments In contrast to direct support, the effectiveness of tech -nology centres seems to be far worse as far as the pro
funds for investments, personnel, 76.9 38.5 Financial problems: lack of finance, too high risk consultancy, reduction of risk
Creating a RTD Investment Policy for Regions in Emerging and Developed Economies Contract no: 029746-CRIPREDE
, through the investment decisions taken on the kinds of research undertaken in specific institutions. Of particular importance in this regard for the de
investments in R&d, measured by corporate patenting by region within ICT industries in regions in the UK, Germany and Italy, are agglomerated highly (Santangelo 2002
Bangalore†s success is only a result of the foreign investment because of low cost ad -vantages and has not a real impact on economic development and local entrepreneur
For instance, a lot of investments were made in infrastructure (e g.,, data net -works) that supported the settlement of foreign enterprises.
some others with large R&d investments and good collaboration with universities OECD 2001 Oresund is home to one of the worlds†best biotechnology clusters.
-sitioned to attract industrial and financial investments in the biomedical area†(Boston Consulting Group 2002.
It is the most important investment region in Scandinavia and ranked number three in Europe when it comes to the number of investment projects
Oresund Region 2006 A main issue for the region is knowledge and learning, which helped making this re
Role of R&d in Attracting Regional Investments. Copenhagen Breschi, S. 2000: The Geography of Innovation:
capital investment and productivity growth (see Section 4. 1), the results indicate that an instantaneous impact of ICT capital investment
on total factor productivity growth does not take place in this sector. This is not in line with the
-creased investment in ICT capital Regressions based on the micro-data from the E-business Survey 2007 aimed to explore links
adoption and complementary investments in skills enhance innovation, which is positively associated with turnover growth
productivity and growth through investment in information and communication technologies, human resources (notably e-skills) and new business models".
national statistical institutes (e g. investment series), but also from a variety of national sources, in cases where no international database or statistics from the
capital-intensive investment is only profitable in the TLS sector only if the workforce has the skills
Employers are now less likely to see training just as a cost but also as an investment
In a knowledge economy driven by rapid technical change, investments in high-skilled labour, training and skill-formation become more important than investments in ICT.
The intelligence and skills of ICT users determines the positive or negative impact that ICT
investments may have on the success of the TLS business (see Section 4. 1 In terms of policy implications it has to
3. 2. 2 Outsourcing of ICT services and ICT investments Outsourcing Outsourcing is considered a useful way to provide immediate ICT and e-business skills
and processes that a company needs with very little investment of time, money and training.
ICT expenditure and investments There is consensus that EU faster growth during the last decade has been related to
higher investments in ICT. The highest performing countries have been those that have been more innovative in ICT products
it has to be pointed out that ICT investments does not lead to productivity growth at firm-level by itself (it depends on how the
Complementary investments in human capital organisational changes and working practices, combined with ICT investments will have
an impact on firm performance About 30%of all firms planned to further increase their ICT budgets in 2008,
investment behaviour in the TLS sector appears, in general, more intensive than in other sectors studied:
%Exhibit 3. 2-5 ICT budgets and investments Companies expecting that their ICT budget will †in the forthcoming financial period
made investments in ICT hardware or networks during the past 12 months Weighting:%%of empl
investment, because they are genuinely excellent software products and the support is acceptable. In comparison with proprietary software OSS is more inexpensive in acqui
as to lower implementation risks and consequently maximize investment returns. As an example, while the European commission, ETSI, industry associations and commercial
fast return on investment, also for SMES. Currently, 25%of firms accounting for about 33%of employment in the TLS industry say they send e-invoices,
when relationship investment are indispensable or specific assets are procured, firms will create networks in which suppliers and buyers
This provides support to the hypothesis that close relationships facilitate investments in specific technologies. Collaborative practices and ICT applications, in turn, further
collaboration, as well as investments in ICT and in ICT-enabled innovation Finally, a firm†s performance is assumed to be the outcome of its conduct.
analyse to what extent ICT-capital investments have effects on productivity growth (as compared to other factors) in the transportation and logistics sector.
ICT-capital investment and total factor productivity growth For the study of ICT impacts on firm-level productivity, two considerations are essential
ICT investment does not lead to productivity growth at firm-level by itself. It depends on how the technology is actually
Thus, only if ICT investment is combined with complementary investment in working practices, human capital, and firm restructuring will
it have an impact on performance (cf. Brynjolfsson and Hitt, 2000 The case study on ALSA, a Spanish road passenger transport company, confirms the
These complementary investments and organisational changes are highly sector-and firm-specific; therefore, returns to ICT investments vary strongly across organisations
Pilat, 2005. Second, it has to be considered that outsourcing is an organisational innovation which can change firm-level productivity (Erber,
contribution of ICT-capital investment to productivity growth. It is assumed that it has become a key component of total factor productivity (TFP) growth (see Hypothesis
ICT-capital investment has become a key component in value added and productivity growth in the transportation and logistics sector, while other capital
that total factor productivity growth jointly accelerates with higher investment in ICT -capital. This will be tested as a second hypothesis
together with increased investment in ICT-capital Another important factor that may influence the extent to which ICT enables productivity
analysis will therefore focus on the interdependence of ICT investments with skill requirements in the transport and logistics sector.
-capital investment on labour productivity growth (in terms of gross production value per total hours worked), based on an econometrically estimated stochastic production
In contrast, physical ICT-capital investment does not have a significant impact on labour productivity.
measured as ICT capital investments) contributes to growth of value added and productivity. The results indicate that ICT capital by itself is not the main element, but that
it rather requires complementary investments and organisational innovation Growth accounting for the transport sector in 10 EU Member States suggests that
ICT-impact"which cannot be measured by means of the data on ICT-investment available in the database
They suggest that investments in training and skill-formation are at least equally important as investments in ICT capital
themselves in order to realise the optimal benefits. In other words, in a knowledge economy driven by rapid technical change,
place, costly investments bear the risk of becoming ineffective. Thus, revisiting the two initially specified working hypotheses (see 4. 1. 1),
P. 1 ICT-capital investment has become a key component in value added and productivity growth in
investment in ICT-capital No significant average annual rate of technical progress for the common production possibility frontier was found
link between ICT-capital investments and labour productivity growth is probably much weaker. Rather, the share of high-skilled labour and the intermediate inputs intensity
supported a possible relationship between investments in ICT-capital and TFP growth Probably, this might be due to the time structure between investments in ICT-capital and
its impact on TFP. The standard approach in growth accounting typically assumes that TFP-growth instantaneously increases with increased investments in ICT-capital.
There might, however, be a time lag between the initial investment and implementation of new technology (and the respective organisational changes) and their actual impact on TFP
-E-business in the transport & logistics industry 105 growth. 119 This could partly explain why we could not find any strong relationship between
evidence the hypothesis that there is an instantaneous impact of ICT-capital investments on total factor productivity growth has to be rejected
ICT investments in general and e-business applications in particular enable and drive process innovation. They are drivers,
The most obvious example of investments in complementary assets include investments in software, training and organisational transformations that
accompany ICT investments. In other words, firms that combine high levels of ICT and high levels of worker skills have better firm innovation performance.
Thus, the following hypothesis can be formulated Hypothesis I. 1: Firms characterised by a higher share of employees with a university
demonstrated clear payoffs from ICT investments (Chan, 2000, Kohli and Devaraj, 2003 In addition, the results vary depending on how performance
investments on productivity, but not on profits (Brynjolfsson and Hitt, 1996). Another study did not find positive effects of ICT capital on productivity,
investments and corporate performance. The key to understanding the impacts of ICT on performance is to view ICT as an enabler of innovation (Koellinger 2005
linkage between ICT investment and labour productivity may actually be much weaker than the evidence from more aggregate studies suggests.
instantaneously rises with increased investment in ICT capital. This is in contrast to case studies, which indicate that often there are significant lag times in reaping the benefits
capital investment on total factor productivity growth does not take place, so that this hypothesis has to be rejected
Close relationships facilitate investments in specific technologies. Third, the success of the ICT-driven innovative process depends on the availability and quality of
AISA says that the system is highly profitable (investment vs. results. The total estimated cost of the system was about â 100,000.
SNCF therefore considered an investment in e-services to be of strategic importance While the company started some isolated e-services initiatives in 2005,
customer needs is a key success factor and an investment in market analyses and customer surveys of the solution is very important.
independence from the railways as well as investment in its own assets such as rolling stock. Today, terminals and IT solutions remain the key success factors for the
investment and controlled growth, the company now has an annual turnover in excess of 6 Million euros.
N c. Cammack & Son believes that one of the reasons for its success is its investment in
significant financial investments. Although N c. Cammack & Son initially did face resistance from their employees, the company achieved great results with the
Therefore, investments in training and skill-formation are at least equally important as investments in ICT capital itself in order to attain optimal benefits.
In other words, in a knowledge economy driven by rapid technical change, the ability to empower the work
skills in place, costly investments bear the risk of becoming ineffective IT practitioners. Interviewed SMES often lack a coherent ICT investment strategy or the
related skills-partly because most SMES cannot afford to employ ICT practitioners According to the present report, only about 9%of small firms and 33%of medium-sized
investments in training and skill-formation are at least equally important as investments in ICT capital themselves in
order to realise the optimal benefits Using the key findings and the companies†subjective feelings, the
In this context, the European commission, the European Investment Bank and the European Investment Fund launched, in May 2006 the Joint European Resources for
124 Other possible tools could include microcredits, strengthening equity capital, mezzanine financing, securisation of loans, etc
investments in training and skill-formation are at least equally important as investments in ICT capital themselves in order to realise the
optimal benefits. Thus investments in e-skill formation and training have to be prioritised This is also in line with the recommendations made in the recent"Small Business Act"for
Europe, where one of the 10 action lines focuses on upgrading the skills in SMES. 125
The implementation of new ICT and complementary investments can lead to innovations and innovations are associated positively with turnover growth.
The Intangible Costs and Benefits of Computer Investments Evidence from the Financial Markets. Atlanta, Georgia:
IT investment and firm performance in US retail sector. Economic Studies, No 02-14, Washington D c.:
The relationship between investment in information technology and firm performance: A study of the valve manufacturing sector.
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