Powering innovation through tax concessions: The changing research & development tax incentives

The changes to the R&D tax concession in 2011 were touted as the biggest reform to business innovation policy in over a decade. Three years later, as part of the 2014 Federal Budget, a reduction in the concession rates was announced. While the most recent of the pro-posed changes are designed to align with the reduction in company tax rate, the Australian Federal Government also indicated that the gain to revenue from the reduction in the incentive scheme will be redirected by the Government to repair the Budget and fund policy priori-ties. The consequence is that the R&D concessions, while designed to encourage innovation, are clearly linked with the tax system. As such, the first part of this article considers whether the R&D concession is a changing tax for changing times. Leading on from part one, this article also addresses a second question of ‘what’s tax got to do with it’? To answer this question, the article argues that, rather than ever being substantive tax reform, the constantly changing measures simply alter the criteria and means by which companies become eligible for a Federal Government subsidy for qualifying R&D activity, whatever that amount is. It further argues that when considered as part of the broader innovation agenda, all R&D tax concessions should be evaluated as a government spending program in the same way as any direct spending on innovation. When this is done, the tax regime is arguably merely the administrative policy instrument by which the subsidy is delivered. However, this may not be best practice to distribute those funds fairly, efficiently, and without distortion, while at the same time maintaining adequate government control and accountability. Finally, in answering the question of ‘what’s tax got to do with it?’ the article concludes that the answer is: very little.

Australian innovation ecosystem: A critical review of the national innovation support mechanisms

Innovation is understood as the combination of existing ideas or the generation of new ideas into new processes, products and services, and widely viewed as the main driver of growth in contemporary economies. In the age of the knowledge economy, successful economic development is intimately linked to a country’s capacity to generate, acquire, absorb, disseminate, and apply innovation towards advanced technology products and services. This development approach is labelled as knowledge-based economic development and highly associated with a capacity embodied in a country’s national innovation ecosystem. The research reported in this paper aims to critically review the Australian innovation ecosystem in order to provide a better understanding on the potential impacts of policy and support mechanisms on the innovation and knowledge generation capacity. The investigation places Australia’s innovation system and national-level innovation support mechanisms under the microscope. The methodology of the study is twofold. Firstly, it undertakes a critical review of the literature and government policy documents to better understand the innovation policy and support mechanisms in the country. It, then, conducts a survey to capture Australian innovation companies’ perceptions on the role and effectiveness of the existing innovation incentive programs. The paper concludes with a discussion on the key insights and findings and potential policy and support directions of the country to achieve a flourishing knowledge economy.

The geography of creative people in Germany

It has been argued that creativity is an important source of regional growth. This paper investigates the geography of people in creative occupation in Germany. The population share of the Creative Class as well as of bohemians and artists is relatively high in larger cities, but smaller places and rural regions may also have a considerable proportion of people with a creative job. While ethnical and cultural diversity and a high level of public supply in health care and education can explain the distribution of creative people, employment opportunities seem to play only a minor role. A high share of creative occupations seems to be conducive to regional growth; however, the exact nature of this relationship is still unclear.

Between formal and informal : the shakeout in China’s online video industry

While a rich body of literature in television and film studies and media policy studies has tended to focus on the media activities in the formal sector, we know much less about informal media activities, its influence on state policies, as well as the dynamics between the formal and the informal sectors. This article examines these issues with reference to a particularly revealing period following a large-scale government crackdown on peer-to-peer video sharing sites in China in 2008. By analyzing the aim and consequences of the state action, I point to the counter-productive effect in terms of cultural loss and the resurgence of offline piracy; and show the positive impact on forcing the informal into the formal sector, and pressuring the formal to innovate. Meanwhile, an increasing rapprochement between professional and user-created content leads to a new relationship between formal and informal sectors. This case demonstrates the importance of considering the dynamics between the two sectors. It also offers compelling evidence of the role of the informal sector in engendering state action, which in turn impacted on the co-evolution of the formal and the informal sectors.

Money ruins everything

In the economy of the 21st century, economic and technical innovation is increasingly based on developments that don't rely on economic incentive or public provision. Unlike 20th century innovation, the most important developments in innovation have been driven not by research funded by governments or developed by corporations but by the collaborative interactions of individuals. In most cases, this modality of innovation has not been motivated by economic concerns or the prospect of profit. This raises the possibility of a world in which some of the sectors of the economy particularly the ones dealing with innovation and creativity are driven by social interactions of various kinds, rather than by profit-oriented investment. This Article examines the development of this amateur modality of creative production, and explains how it came to exist. It then deals with why this modality is different from and potentially inconsistent with the typical modalities of production that are at the heart of modern views of innovation policy. It provides a number of policy prescriptions that should be used by governments to recognize the significance of amateur innovation, and to further the development of amateur productivity.

Incentives for global public health: Patent law and access to essential medicines

This portrait of the global debate over patent law and access to essential medicines focuses on public health concerns about HIV/AIDS, malaria, tuberculosis, the SARS virus, influenza, and diseases of poverty. The essays explore the diplomatic negotiations and disputes in key international fora, such as the World Trade Organization, the World Health Organization and the World Intellectual Property Organization. Drawing upon international trade law, innovation policy, intellectual property law, health law, human rights and philosophy, the authors seek to canvass policy solutions which encourage and reward worthwhile pharmaceutical innovation while ensuring affordable access to advanced medicines. A number of creative policy options are critically assessed, including the development of a Health Impact Fund, prizes for medical innovation, the use of patent pools, open-source drug development and forms of 'creative capitalism'.

The new conquistadors: Patent law and expressed sequence tags

It's akin to the old Spanish, English and Portuguese explorers. They would take their boats until they found some edge of land, then they would go up and plant the flag of their king or queen. They didn't know what they'd discovered; how big it is, where it goes to - but they would claim it anyway. David Korn of the Association of American Medical Colleges This article analyses recent litigation over patent law and expressed sequence tags (ESTs). In the case of In re Fisher, the United States Court of Appeals for the Federal Circuit engaged in judicial consideration of the revised utility guidelines of the United States Patent and Trademark Office (USPTO). In this matter, the agricultural biotechnology company Monsanto sought to patent ESTs in maize plants. A patent examiner and the Board of Patent Appeals and Interferences had doubted whether the patent application was useful. Monsanto appealed against the rulings of the USPTO. A number of amicus curiae intervened in the matter in support of the USPTO - including Genentech, Affymetrix, Dow AgroSciences, Eli Lilly, the National Academy of Sciences, and the Association of American Medical Colleges. The majority of the Court of Appeals for the Federal Circuit supported the position of the USPTO, and rejected the patent application on the grounds of utility. The split decision highlighted institutional tensions over the appropriate thresholds for patent criteria - such as novelty, non-obviousness, and utility. The litigation raised larger questions about the definition of research tools, the incremental nature of scientific progress, and the role of patent law in innovation policy. The decision of In re Fisher will have significant ramifications for gene patents, in the wake of the human genome project. Arguably, the USPTO utility guidelines need to be reinforced by a tougher application of the standards of novelty and non-obviousness in respect of gene patents.

Public policy implications of construction innovation research

This report undertakes an exploratory analysis of Construction Innovation research projects in order to answer the question “What are the public policy implications of Construction Innovation research?”

Research training and national innovation systems in Australia, Finland and the United States : a policy and systems study supported by 30 case studies of research students in the fields of geospatial science, wireless communication, biosciences, and materials science and engineering

Reforms to the national research and research training system by the Commonwealth Government of Australia sought to effectively connect research conducted in universities to Australia's national innovation system. Research training has a key role in ensuring an adequate supply of highly skilled people for the national innovation system. During their studies, research students produce and disseminate a massive amount of new knowledge. Prior to this study, there was no research that examined the contribution of research training to Australia's national innovation system despite the existence of policy initiatives aiming to enhance this contribution. Given Australia's below average (but improving) innovation performance compared to other OECD countries, the inclusion of Finland and the United States provided further insights into the key research question. This study examined three obvious ways that research training contributes to the national innovation systems in the three countries: the international mobility and migration of research students and graduates, knowledge production and distribution by research students, and the impact of research training as advanced human capital formation on economic growth. Findings have informed the concept of a research training culture of innovation that aims to enhance the contribution of research training to Australia's national innovation system. Key features include internationally competitive research and research training environments; research training programs that equip students with economically-relevant knowledge and the capabilities required by employers operating in knowledge-based economies; attractive research careers in different sectors; a national commitment to R&D as indicated by high levels of gross and business R&D expenditure; high private and social rates of return from research training; and the horizontal coordination of key organisations that create policy for, and/or invest in research training.

Generation next : post-cinema Australian moviemaking, innovation and implications for cultural policy

The Australian screen industries are a leading domestic creative industry sector at a crossroad. New production, distribution and exhibition technologies are challenging traditional models of ‘filmmaking’. For the screen industries to remain competitive they must renovate business models for an emerging marketplace. This paper is a preliminary examination of three key aspects of next generation filmmaking: post-cinema approaches to screen production, emerging production and business models, and issues for policy.

Renovating Research and Policy on Creative Industries and Innovation

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Book Review: "Mark Considine, Jenny Lewis and Damon Alexander Networks, Innovation and Public Policy : Politicians, Bureaucrats and the Pathways to Change inside Government Houndsmills, UK: Palgrave Macmillan, 2009"

Having wrung the most from workforce and workplace productivity initiaitves, innovation has come to the fore as a key goal and directive for public sector organisations to become more efficient. This clarion call for innovation can be heard all around the world, with public services everywhere taking up the message to develop better, smarter, novel, more innovative processes, programs and policies. In the current push for innovation, networks are considered to be a superior vehicle through which collective knowledge can be shared and leveraged; replacing or at least supplementing the role function previously provided by inventive leaders...