Innovation for a strong and sustainable recovery
In the recovery from Covid-19, innovation and diffusion will be key to addressing several structural challenges facing the UK economy. These include improving the UK’s longstanding poor productivity performance, addressing large-scale disparities across and within regions, and re-orientating the economy to reach net zero emissions of greenhouse gases by 2050. We analyse patent data to identify areas where the UK has comparative advantage in innovation, and where the economic returns in the UK might be large, highlighting technologies that are relevant for two key societal challenges: net zero and dealing with the pandemic. We conclude with policy implications. While the government’s ‘Ten Point Plan for a Green Industrial Revolution’ provides a clear signal for future investment and growth, this needs to be accelerated and complemented with consistent and long-term innovation and industrial policy to facilitate transition to sustainable business models, investments and related innovation.
18 December 2020 Paper Number CEPCOVID-19-014