Fostering innovation in Iceland for the digital era

Vassiliki Koutsogeorgopoulou and Eunha Cho

No 1686, OECD Economics Department Working Papers from OECD Publishing

Abstract: Iceland is an innovative country, but has untapped innovation potential. Strengthening innovation, especially in the ICT area, is crucial for strong productivity growth and performance in an increasingly digitalised world, as well as a sustained recovery from the COVID-19 pandemic. Ensuring more effective public support for business R&D is important. The R&D tax incentive scheme is generous by international comparison, but take-up has been low and many smaller firms have not been inclined to innovate. Following increased support, outcomes need to be monitored regularly. Adopting new technologies is also essential for stronger innovation outcomes. Competition-friendly framework conditions are key to sharpening firms’ incentives to adopt advanced technologies. The public sector too could become more digitalised. The education system needs to provide relevant skills. Participation of adult workers, especially the less educated, in re-skilling and up-skilling programmes should increase further. At the same time, business and universities need to collaborate more to maximise knowledge flows, with important benefits for innovation and society.

Keywords: collaboration; digital; innovation; productivity; R&D; skills; tax incentives; technologies (search for similar items in EconPapers)
JEL-codes: I23 J24 O3 O32 (search for similar items in EconPapers)
Date: 2021-11-04
New Economics Papers: this item is included in nep-ict, nep-lma and nep-sbm
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Persistent link: https://EconPapers.repec.org/RePEc:oec:ecoaaa:1686-en

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