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JIIS Bulletin - September 2011
Examining the efficacy of cross-boundary R&D collaboration programs
The global village we live in today appears to be getting more sophisticated. But is it? There are many areas in which borders no longer play a role, though culture, attitudes and of course politics still do. Research and Development cooperation is a classic example of long-distance cooperation between countries, and it is growing all the time, in quantity and quality, sometimes driven by political factors and sometimes to avoid them. It fits well into a (rather global) trend that sees future development as a trans-border mission that requires both technological and business abilities that cannot be procured in any one country. 

The European Union (EU) was one of the first bodies to recognize and react to this trend about 20 years ago. It set up a number of programs, inviting groups from different countries to share their different R&D methods, based on the belief that doing so can maximize the benefits for all the parties involved, and that it will generate technological and business competitiveness. Many states soon jumped on the same bandwagon, including Israel, which invested huge sums in numerous bilateral, multilateral and specifically-EU R&D cooperation programs. 

The JIIS' Economics Unit researchers decided last year to analyze the efficacy of these programs, in the framework of the Enterprise Europe Network (EEN). What they found was that while these programs do have positive effects on the technological and businesslike capacities of the firms involved, the money being poured into state-funded programs was not necessarily being used optimally, according to Dr. Dan Kaufmann, head of the Economics Unit. "We found that local R&D incentives have the same and sometimes greater 'added value' to a firm than international programs.” 

The researchers tried to understand why this was so. One possible explanation, they suggest, is that the international collaboration schemes are based on the same rules and conceptual frameworks as the local schemes, which tend to emphasize technological development while almost ignoring business development. "For example, registering a patent or building a prototype is a recognized cost by the Chief Scientist while travel expenses, even if they are to encourage business growth or to set up a joint venture with the collaborating partner, are not."  

The research shows that to attain the optimum value of international R&D collaborations government-sponsored frameworks must be better able to go beyond the technological dimensions and support the development of business aspects as well. “There is no doubt that there is huge technological and business potential in such international R&D programs, whether in Israel or elsewhere, but there is a gap between the policy objectives  and the policy tools being used," Kaufmann says. "We recommend that the support mechanisms built into the programs be adapted so that they can truly facilitate technology-sharing while adding business value to the different firms involved." 

Kaufmann, together with Yael Marom, presented their study recently to the Ministry of Finance, the Ministry of Industry, Trade and Labor, the Chief Scientist's Office, MATIMOP (which functions as the Israeli representative of the EU's Eureka program) and stakeholders from the private sector. Their recommendations are being integrated to the Chief Scientist's report on the international activity.  

The project was supported by the EEN and the Planning, Research and Economics Administration at the Ministry of Industry, Trade and Labor. JIIS will be hosting a conference on this subject on 30 October. 
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