Innovation: Turkey makes the right choices

Four Femise researchers have compared government support for innovation in Turkey with that in Poland. The study by Femise comes out in favour of Turkish government strategy

Turkey and Poland may be comparable in terms of economic development and technological capabilities but they have pursued different business innovation strategies. According to the authors of the FEM35-18 study by Femise, which compares public policies in support of innovation, Turkey is benefitting more from its strategy, investing more and in a better way than Poland.
In 2010, 23.6% of Turkish companies brought innovative products or services onto the market, compared with 12.9% of companies in Poland. This is in spite of the availability of better-trained staff and more patent registrations in Poland. Is this the result of increased spending on innovation by Turkey, a level that has overtaken and is now double that spent by Poland? Yes, but this does not explain everything, according to the Femise researchers.
It is true that a higher proportion of firms benefit from innovation support schemes in Turkey than in Poland (15.6% compared with 6.7%) and as the support is less focused on large companies it touches a wider range of enterprises. However, the report by Femise explains that the difference also stems from the fact that support for innovation in the two countries pursues different strategies.
In 2010, 23.6% of Turkish companies brought innovative products or services onto the market (photo Republic of Turkey Ministry of Economy)
In 2010, 23.6% of Turkish companies brought innovative products or services onto the market (photo Republic of Turkey Ministry of Economy)

A strategy focused on R&D

In Turkey, business innovation policy benefits from a more stable institutional environment and from the presence of a coordinating body (the Tübitak agency). The policy principally targets research and development programmes aimed at the creation of new products or processes.
In addition, tax incentives and calls for projects stimulate innovation in key sectors. The study headed by Krzysztof Szczygielski, researcher at the Center for Social and Economic Research in Warsaw, underscores that Turkish strategy is better targeted, meeting more of its aims with greater efficiency.
Conversely, Poland, with unstable and uncoordinated organisations, gives support for innovation via grants, generally funded by Europe, which are used to purchase new technologies or to finance training schemes.
Support for SMEs is a good example of the relevance of the Turkish strategy. While in some areas, SMEs form the bulk of local enterprise, they often remain outside the radar of state institutions, in particular while details of support measures have not been fully unveiled.
On the back of this finding, in 2007 Tübitak set up a dedicated programme that funds up to 75% of SMEs' R&D expenditure. Consequently, the number of SMEs benefitting from support has seen a marked increase. In 2010, 11.8% of Turkish companies with 10 to 49 employees received innovation support, compared with 2.8% for their Polish counterparts.

Mathieu Bouchard

Thursday, October 17th 2013

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