Libro Blanco Vol I en Ingles

TOWARDS A NATIONAL INNOVATION STRATEGY FOR COMPETITIVENESSVOLUME 1All of this leads to a clear conclusion: if the contribution of classic production factors (capital and work)sooner or later declines, the only possible option is to bet on TFP. Then, the following question arisesspontaneously: What does it depend on? Firstly, it is based on factors such as social cohesion, the quality ofinstitutions or macroeconomic stability, which means that growth is intimately linked to the general activities ofgovernments and public policies. However, above all, the growth of TFP is based on the dynamic and diffusion ofknowledge, on technological change, on the capabilities and the efforts of people –human capital– and oninnovation.These are precisely the areas that lie at the heart of the mandate of this Council and the axis that formsthe basis of this National Innovation Strategy for Competitiveness, because they are, in turn, the zones in whichthe country has the most significant lags compared to its international competitors as will be shown in thisdocument.IS CHILE PREPARED FOR DOUBLING ITS INCOME?This question is not trivial, and the answers, as we will see further ahead, are not necessarilyencouraging. In fact, the international studies show that the competitiveness and productivity lags that Chilemust overcome to attain the level of developed countries increases as they grow faster; this can be clearly seenin the global ranking, where maintaining ones’ position or raising it is an ever more difficult challenge.A cold and non-ideological look at the international evidence compels us to recognize that the keys forcompetitiveness and growth are human capital, R+D and production diversity, three aspects in which Chile hasserious lags, and so decisive steps on these fundamental pillars could provide major returns for Chile.In the 2006 Global Competitiveness Report, the World Economic Forum (WEF) defines the competitivenessof an economy as the “range of factors, policies and institutions that determine the productivity level of acountry”, which converge on nine pillars defined based on the results of more recent empirical and theoreticalstudies on the issue. These are: a) the quality of public institutions, b) infrastructure, c) macroeconomicstability, d) health and primary education, e) higher education and training, f) the efficiency of markets, g)technological preparedness, h) the sophistication of businesses and i) innovation.In 2005 and 2006 Chile ranked 27 in the global index and is the best ranked Latin American country 13 , aunique situation in the world, since, as the WEF indicates, in general countries of the same region have similarperformances. This strong position of Chile is not only a reflection of solid public institutions operating at levels13 Argentina and Brazil, the nearest Latin American countries behind Chile in the list, are ranked 69 and 66, respectively.31