The Joint Research Centre s contributions towards a competitive economy. Conference Examining the Roots of Innovation. Budapest, 5 th April 2011

Transcription

1 Towards an Open and Competitive Economy, Budapest 5 th April The Joint Research Centre s contributions towards a competitive economy Conference Examining the Roots of Innovation Budapest, 5 th April 2011 John Bensted-Smith, Director of the IPTS

2 JRC Thematic Areas Towards an Open and Competitive Economy, Budapest 5 th April Sustainable Growth and Development Safety and Security Towards an open and competitive economy Nuclear safety and security Development of a low carbon society Joint Research Centre strategy Safety of food and consumer products Sustainable management of natural resources Reference materials and measurements Security and crisis management

3 Towards an open and competitive economy Towards an Open and Competitive Economy, Budapest 5 th April Implementation The JRC Thematic Area structured along 5 axes: a) Monitoring and Analysing the Knowledge Economy; b) Contributing to the Digital Agenda; c) Assessing ways towards a competitive agriculture in an open trade environment; d) Supporting the EU's Sustainable Consumption & Production Strategy; e) Carrying out research on the impact of energy, transport and climate change policies on the European economy.

4 Our Competences at the service of the Flagships: an example Towards an Open and Competitive Economy, Budapest 5 th April EU2020 Flagships Industrial Policy Fighting Poverty Resource Efficiency Youth on the Move Innovation Union Skills & Jobs Digital Agenda Customer DG ECFIN ENV MOVE INFSO CLIMA ENER AGRI REGIO JUST HOME MARKT EAC JRC Competences Modelling (e.g. techno-economics) Foresight (e.g. Delphi,Scenarios) Applied Social Sciences (e.g. Focus Groups, Surveys, etc) Applied Mathematics (e.g. sensitivity analysis, etc.) Economics (e.g. Econometrics, Behavioral Economics, IO Tables) Bureaux-Activities (e.g. Expert groups) Methodologies for Impact Assessments

5 TA1 Contributions to EU Flagships Towards an Open and Competitive Economy, Budapest 5 th April TA1 contribution to the EU2020 Flagships Knowled. 4 Growth Industrial Research & Innovation Regional Economic Modelling ERA Analysis ERA policy, joint programming & foresight Innovation Union Youth on the move Digital Agenda Resource Efficiency Industrial policy for the globalisation era Agenda for new skills and jobs European platform against poverty Info Society ICT for Learning and Inclusion International Digital Economy Analysis Techno-economic Impacts Enabling Societal Change AgriLife New Technologies in Agriculture- their agronomic socioeconomic impact Sustainable agriculture & rural development Agricultural Trade & Market Policies ECCET Integrated Climate Policy Assessment Transport Economic Assessment Energy Economic Assessment SPC Sustainable Production and Consumption European Integrated Pollution and Prevention Control Bureau

6 A. Knowledge Economy Towards an Open and Competitive Economy, Budapest 5 th April Overall Objectives Support the implementation of smart, sustainable and inclusive growth especially through the development of quantitative analysis of the knowledge economy Support the policy services such as Cohesion Policy European Institute of Innovation and Technology (EIT) Framework Programme for research Competitiveness and Innovation Programme

7 A. Knowledge Economy Towards an Open and Competitive Economy, Budapest 5 th April Specific Objectives (i) Innovation Assessment of the factors and barriers determining the growth of innovative companies Development of a model platform to assess the macro-economic impact of innovation, human capital and R&D investments European Research Area Development of a conceptual framework for the quantitative impact assessment of various research policies. Assessment of remaining bottlenecks for the fulfilment of the European Research Area

8 A. Knowledge Economy Towards an Open and Competitive Economy, Budapest 5 th April Specific Objectives (ii) Contribution of Cohesion Policy to the knowledge economy System of models for EU-27 enabling the evaluation of the impact of future Cohesion Policy on growth, employment and environment Quantitative and qualitative tools to analyse at regional and national level the macro-economic effects of smart specialization Quantitative foresight First quantitative impacts of various scenarios for e.g. the European Institute of Technology (EIT) priorities, joint programming or innovation partnerships

9 A. Knowledge Economy Towards an Open and Competitive Economy, Budapest 5 th April Example (i) Rhomolo: Prototype Countries RHOMOLO is a spatial general equilibrium model for the evaluation of impacts of knowledge and infrastructure investments Its coverage will be extended to all regions of the EU-27 in the next two years The main linkages between the regions are transport, capital, knowledge and migration flows Human capital build-up and R&D are major sources of regional productivity gains and spillovers Slovak Republic Hungary Czech Republic Poland Federal Republic of Germany Other Countries Note: EuroGeographics for the administrative boundaries Scenarios to be developed for Cohesion Report (DG REGIO): A) The impact of cohesion policy support to, human capital development, R&D, innovation and infrastructure in a particular region B) The impact of establishing a direct link / investments between two regions

10 2010 Highlights: Industrial R&D Scoreboard - Overall R&D trends (1) Towards an Open and Competitive Economy, Budapest 5 th April Example (i): Industrial R&D Scoreboard 14% 12% % 10% 8% 7.4% 8.8% 8.1% 6.9% 7.7% 9.2% 6.6% nominal growth 6% 4% 2% 0.7% 5.3% 1.2% 3.9% 0% -2% -4% -1.4% -2.0% : 400 companies EU companies -2.6% : companies non-eu companies -1.6% -6% Source: The EU Industrial R&D Investment Scoreboards, EC, JRC/DG RTD. R&D investments of EU scoreboard companies fell more than those from the rest of the world (but less than for US companies).

11 B. Digital Agenda Towards an Open and Competitive Economy, Budapest 5 th April General Objectives Monitor and analyse the emerging Digital Economy and the socio-economic impact of ICT particularly through the development of quantitative analysis of the digital economy Provide policy makers with ex-ante impact assessments to make changes to the respective regulatory landscape to take account of ICT innovations and to guide industrial research and applications policy

12 B. Digital Agenda Towards an Open and Competitive Economy, Budapest 5 th April Specific Objectives (i) Digital Economy An EU-27 model integrating the impacts of ICT as a general purpose technology to evaluate the economic impacts Monitoring, analysing and benchmarking the European Information Economy, and its contribution to the economy at large and R&D for the assessment of the macro-economic impact of research investments. Digital Living A synthesis of new models of health care and health care processes with a focus on ICT support to chronic illness (diabetes, cardiovascular, asthma) Techno-economic investigation of how a Framework of Identity will support citizens and consumers ensuring their participation in tomorrow s Digital Life Future needs for healthy ageing in an ageing society and how ICTs can play a role in addressing these needs

13 B. Digital Agenda Towards an Open and Competitive Economy, Budapest 5 th April eid health mobility Specific Objectives (ii) Digital Society Dynamic Digital Competences framework enabling analysis of education and training, enterprises, employment, and social stakeholders joint actions towards a future agenda on skills working learning creativity and jobs Sufficient knowledge basis on the role and impact at both micro and macro level of ICT for skills development, employability and employment and social inclusion with a focus on migrants, carers and youth at risk

14 B. Digital Agenda Towards an Open and Competitive Economy, Budapest 5 th April Example: ICT for Health, the Diabetes II Case Study 3.5B 1.4B There are 45 million diabetes II patients in EU27. What if 20% would be remotely monitored and treated? Creates a market of 6.5 B, which is also an expenditure for healthcare Compensated by the estimated reduction in hospitalisation of costs Offset macroeconomic benefits if we consider the monetary value of additional life years

15 C. Towards a competitive agriculture in an open trade environment Towards an Open and Competitive Economy, Budapest 5 th April Overall Objectives Provide current and future economic scenario modelling related to decision-making in agricultural policy Analysis and research into the economic aspects of agricultural policy research and support

16 C. Towards a competitive agriculture in an open trade environment Towards an Open and Competitive Economy, Budapest 5 th April Specific Objectives International competitiveness Sustainable growth Economics of technical innovation

17 C. Towards a competitive agriculture in an open trade environment Towards an Open and Competitive Economy, Budapest 5 th April Example (i); Regional Economic Analysis of Milk Quota Reform in the EU Policy context Health Check of the CAP; special focus: reform of the dairy sector Dairy sector makes a substantial contribution to the agricultural turn-over in many EU MS Within the EU-27, size and agricultural importance of the dairy sector varies considerably between MS and across regions Milk quota regime as the most noticeable element of the CMO for milk and milk products 20 November 2008 agreement on the Health Check of CAP; milk quota regime will be abolished in 2015 IPTS policy support Analysis of the economic impacts of different dairy policy reform scenarios Special focus: which effects can be expected of an abolition of the milk quota regime Complementary modelling tools CAPRI, CAPSIM, AGMEMOD

18 C. Towards a competitive agriculture in an open trade environment Towards an Open and Competitive Economy, Budapest 5 th April Example (i): Regional Economic Analysis of Milk Quota Reform Main results: Increase in milk production by about +4.4% in EU-27 Decrease in EU raw milk price by about - 10% in EU-27 Decline in agricultural income by -2% in EU-27 But: overall welfare effects slightly positive in EU-27 % change of milk production < -5% -5% - 0% 0% - +5% +5% - +15% > +15% < -3% -3% - -1% -1% - 0% > 0% -8% -8% - 0% 0% - 8% 8% - 16% 16% % change in agricultural income The effects of milk quota abolition are quite diverse at EU Member State level

19 Towards an Open and Competitive Economy, Budapest 5 th April Example (ii) C. Towards a competitive agriculture in an open trade environment Short-term forecast Uncertainties in market outlook million tons History EU27 Wheat Production EU27 Wheat Consumption Producer Price Wheat Euro/t Source: AGLINK baseline Oct 2010; JRC-IPTS Baseline 220 Euro/t S&D only? Policies Speculation Weather Price Tech. progress Input costs Very variable Feedstock (e.g. biofuels) Price Human cons (e.g. GDP)

20 C. Towards a competitive agriculture in an open trade environment Towards an Open and Competitive Economy, Budapest 5 th April Example (ii cont) Setting of the sensitivity analysis on crude oil prices Reference oil price ($/barrel) $153 $98 $62 high baseline low Corresponding total EU transport fuel consumption (diesel + gasoline) in up by 15% with low oil price - down by 15% with high oil price

21 C. Towards a competitive agriculture in an open trade environment Towards an Open and Competitive Economy, Budapest 5 th April Example (ii cont) Variables consider world price differences by % -40% -20% 0% 20% 40% 60% 80% Crude oil Ethanol Biodiesel Sugar (raw) Coarse grains Wheat Vegetable oil Oilseeds Poultry Effects of the (previous) assumptions-scenarios on world market prices of biofuels and of selected agricultural commodities.

22 D. Supporting the EU's Sustainable Consumption and Production Strategy Towards an Open and Competitive Economy, Budapest 5 th April General Objectives contribute with cost-effectiveness and cost-benefit analyses to support impact assessments of policies, i.e. considering gains and losses for the whole European society, economy and environment develop environmental economic quantitative analysis and modelling in SCP-Policy (Sustainable Consumption and Production)

23 D. Supporting the EU's Sustainable Consumption and Production Strategy Towards an Open and Competitive Economy, Budapest 5 th April Specific Objectives Environmental economics Development and application of a full operational environmental economic modelling capacity (FIDELIO = Full Interregional Dynamic Econometric Input-Output model) in order to support Sustainable Production and Consumption policy assessment

24 D. Supporting the EU's Sustainable Consumption and Production Strategy Towards an Open and Competitive Economy, Budapest 5 th April Example (i): Environmental Economics Tracking Environmental Impacts and Resource Use in the economy at the meso- level via extended economic input-output analysis Iron&Steel Electricity Environmental Accounts: Direct Emissions I&S to metal products I&S to machinery Input-Output Accounts: Analysis of the Economy-wide Sectoral Interrelations And technical change Consumption Statistics and Consumption Modelling: Imputation of Environmental Interventions to Societal Functions

25 E. The impact of energy, transport and climate change policies on the European economy Towards an Open and Competitive Economy, Budapest 5 th April General Objectives understand and analyse the competitive position of the energy intensive sectors in a global context develop analysis of the impact on economic growth and competitiveness of policies on energy, transport and climate change

26 E. The impact of energy, transport and climate change policies on the European economy Towards an Open and Competitive Economy, Budapest 5 th April Specific Objectives Energy policies Transport policies Integrated climate change policies

27 Towards an Open and Competitive Economy, Budapest 5 th April Example E. The impact of energy, transport and climate change policies on the European economy Impact of crisis on the mitigation bill 140 The global economic crisis, by contracting energy demand has reduced the cost of action in the past 2 years but also the short term capacity to invest in lowcarbon technologies billion Euros per year Reaching the 30% reduction target is now (COM(2010) 265) only 11 billion more expensive than the 20% target was 18 months ago (COM(2009) 39) Source: JRC-IPTS, POLES, GEM-E3

28 Conclusions Towards an Open and Competitive Economy, Budapest 5 th April The JRC provides integrated socio-economic and policy support to macro-and microeconomic policies, the structural reform agenda, employment, the education and skills agenda, and the digital agenda ("Innovation Union"). JRC carries out quantitative socio-economic analysis and research on focused areas in order to maximise its impact on policy making;

29 Towards an Open and Competitive Economy, Budapest 5 th April Thank you for your attention!