The need to champion growth through innovation has never been more profound. Unfortunately, the lack of a common ground on which policies should be used to drive innovation leads to neither sustainable nor effective growth. This is because the stakeholders involved in the process present what favors them at the other party’s expense. This, however, can be changed. By taking a public policy innovation online certificate course, students can learn how to use public policies to boost innovation.
4 Public Policies for Driving Innovation
The best policies for effective innovation are:
- Provide direct grants for R&D (Research and Development)
Grants’ effects are difficult to measure because it is possible that private R&D funding would have increased in the absence of these grants. However, government funding for university academics can frequently be directed at initiatives with the greatest potential for long-term gains and higher numbers of private company patent applications.
- Offer tax incentives for R&D
The best method to boost innovation and production is through government tax incentives and grants. Programs from the federal government concentrate on giving businesses incentives to innovate (by improving access to financing and R&D funds), creating a skilled workforce, and enhancing an organization’s capacity to innovate through skill development, research, and collaboration. Lowering the cost of R&D by 10% results in a 10% rise in long-term investment in innovation. The incentive encourages R&D activities that could not have otherwise been carried out due to market failures.
- Train researchers in STEM fields
Research plays a fundamental role in the process of developing new ideas. Research helps guide decisions that turn ideas into innovation. The policy viewpoint on supporting STEM areas includes a variety of proposals, including sponsoring experiments, ensuring that commercialization efforts reach critical mass, and preserving an inventive economy.
However, there is a shortage of research due to the aging workforce and gender imbalances in STEM fields. One way to increase their supply in the long-term would be to invest in training the researchers locally. This can be accomplished by supporting initiatives that increase the number of people who study science, technology, engineering, and mathematics (STEM). The second way is to increase the exposure of aspiring inventors from underprivileged backgrounds to mentorship and role models. The third way is to support the migration of skilled workers, especially immigrant college graduates.
- Promote free trade
Innovation ties productivity and competitiveness. Although the trade agreements and the robust capital investment in the resources sector help to raise earnings, they have also put pressure on several other economic sectors, particularly manufacturing. Opening up trade can promote innovation by enhancing competitiveness, fostering the quick transmission of innovative concepts, and dispersing the cost of the invention over a bigger market.
Innovation is the cornerstone of sustainable development. It allows humans to react to change, adapt, and find new opportunities. Effective public policies that drive innovation, such as promoting free trade and offering tax incentives and grants for R&D, help to finance strategic investments in key areas like manufacturing.