According to the Organization for Economic Co-operation and Developments’ (OECD) “OECD Science, Technology and Industry Outlook 2012,” countries face new challenges to spur innovation in the face of economic constraints. Following the economic crisis, total R&D investments by businesses in OECD member countries declined 4.5% in 2009. Future growth for such expenditures is expected to be hampered in the hardest hit countries and by the crippling of entrepreneurship compared to pre-2008 levels. OECD-area government R&D investments in 2009 increased about 9% due to stimulus programs, but declined about 4% in 2010 as a result of budget cuts. In contrast, emerging nations have continued to invest in R&D after the crisis. China’s share of worldwide R&D increased from 10.5% in 2008 to 13% in 2009. New economic realities emphasize the need for innovation in developed countries, in particular to address environmental issues, the health of older populations and for public services. In addition, “inclusive innovation” is driving development of products to impact all levels of society. To drive innovation, countries are increasingly using targeted R&D instruments (such as tax incentives and clusters), commercializing public research, increasing open science and internationalization, and more effective R&D management.

Source: OECD