RDVP Seminar: Motoo Kusakabe (5/10/2005)

Motoo Kusakabe of the European Bank for Reconstruction and Development (EBRD) is visiting Stanford as part of the selection committee for next year's group of fellows. He gave a seminar on ICT, development, and a National Innovation System. Starting from first principles, he chose a metric that he wanted to improve: per capita GDP. He showed a list of the top performers in terms of increasing GDP over the period from 1980 - 2002:

1. China: 8.2%
   
2. Korea: 6.1%
   
3. Ireland: 4.8%

Then he looked at different theories that might explain the difference between high performers and low performers. He felt that most of the earlier theories (Investment/Savings Gap; Structural / Macroeconomic Policy; and Governance) had not adequately explained the difference, and proposed to delve deeper into whether technology and innovation might explain it better. He further segmented the study into Lower Income Countries (annual per capita GDP < $2,936) and Higher Income Countries (above that rate). Since it was a study of development, OECD countries (already developed) were excluded.

With each category of factor, he determined the strength of the correlation between the 2002 data and their growth rate over this 22 year period. Some findings were surprising (most troubling to me was the NEGATIVE correlation between number of scientists/engineers in Lower Income Countries and their economic growth), others were more expected, if weaker than expected and not always consistent between Higher Income and Lower Income Countries. Some of the factors that Motoo cited included primary education, telephone lines (and installation waiting time), internet users, PC, internet servers, and (especially) government priority in ICT and cluster development; exports (especially of hi-tech and ICT equipment and services); governance factors; availability of credit and risk capital.

He did include the disclaimer that showing a correlation is not causation, and there were some additional suggestions from the audience that he should look at multi-variate correlations and data covering the same period (correlating 2002 data with long-range growth rates implies that if there were causation it was probably that long-term fast GDP growth caused the related factors rather than vice versa).

He moved on from the data to the recommendations, outlining a policy of investment and priorities that he felt governments of the Lower Income Countries and Higher Income Countries should pursue to achieve faster GDP growth. These priorities included education, IT literacy, teacher training, connecting the rural poor, microfinance, a payment system for rural areas, job creation, and an ICT focus in government to create a national strategy and regulatory framework, and set up a universal access fund and incubator. Higher income countries should also focus on ICT exports, and move up to higher scale efforts on universities, incubators and science parks, even a national innovation system that includes collaboration from academic, industrial, business, and government parties.

He concluded with a brief description and demo of an Open Knowledge Management System, a way of creating a portal for sharing information with editor functions. A sample is http://www.ictseminar.org.