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The Future of Manufacturing and Innovation in Germany and the US

Tuesday, March 28, 202310:00 AM to 12:30 PM EST
Information Technology and Innovation Foundation (Hybrid Event)700 K St NWSuite 600 Washington DC 

Event Summary

Manufacturing in the United States and Germany face several innovation-related challenges: the structural impact of the green and digital transformations on key industries such as car manufacturing, skills and capabilities in the labor market for innovation, and vulnerabilities in the globalized value chains. For decades, the policy consensus may have been that these were not problems to be solved, but the logical, and indeed desirable, conclusion of large, industrialized economies operating in an open, globalized market. Offshoring the production of a certain component was not an issue so long as that component was readily available; an undiversified supply of energy was not a threat so long as the supply of gas did not pose challenges; the lack of domestic skills and capacities was not so much a concern so long as the movement of people across borders was relatively unobstructed.

This event brings together several leading thinkers on STI from the United States and Europe to discuss some of the key innovation challenges for manufacturing now and in the years ahead, and to explore what types of policies are necessary for innovation to meet these challenges.

Join ITIF and OECD Working Party to explore policy questions that arose in the context of the OECD Review of Innovation Policy: Germany, but which have relevance to both the United States and Germany.

Welcome and Introduction to the Workshop (10:00–10:30 AM)
  • Robert Atkinson, President, ITIF
  • Andrew Wyckoff, Director, OECD Directorate for Science, Technology and Innovation
Session 1: State of Play – Strengths and Weaknesses of the Innovation Systems of the U.S and Germany in Comparison (10:30–11:00 AM)

The United States and Germany can base their approach to address current and future challenges from different starting conditions. In comparison to Germany, U.S. manufacturers face few constraints, from financiers, governments, or unions. To the extent there is any constraint, it is to maximize short-term profits for equity holders. Another important element is the respective conditions for business formation: while the start-up ecosystem is a key strength of the U.S. innovation system, financing conditions for scaling new business in Germany are more difficult. On the other hand, the U.S. innovation-support ecosystem is less developed, including in areas like apprenticeship, pre-competitive R&D consortia and SME support.

What are the strengths and weaknesses of this system? How serious are these challenges and what should policymakers in each country do – through learning from the other – to address them?

  • Caroline Paunov, Head of the Working Party for Technology and Innovation Policy, OECD
  • Luke Mackle, Policy Analyst, OECD
Session 2: Innovating for the Future of Manufacturing: Competitiveness and Key Enabling Technologies (11:00–11:40 AM)

What are the main changes needed in U.S. and German manufacturing to succeed in the future? There is a growing consensus in the United States and Germany that the manufacturing sector requires additional technological capabilities in order to improve the resilience of its supply chains and production, particularly in in key enabling technologies such as semiconductors, batteries, and hydrogen. But how should priorities be identified, and by whom? In the United States the CHIPS and Science Act was a watershed movement where government targeted particular industries for support. Is this likely to be a one-time event, or portend a new era of government support for advanced industries? Should industries or technologies be the focus, or, in fact is it the application of technology, that is of critical, even strategic, importance? Are weaknesses in manufacturing supply chains really a question of innovation, or simply investment (incentives)?

Panelists are invited to provide a short intervention on one or more of these themes, before opening the floor to a Q&A.

  • Speakers to be announced.
Session 3: Changing Course in Innovation: Guiding Transitions – Digital Transformation and Environmental Sustainability (11:40 AM–12:20 PM)

The competitiveness of manufacturing in the United States and Germany has been supported by a mature, well-functioning STI system. But can the institutional and policy mix for STI respond to challenges of resilience? How can the transition to cleaner manufacturing be supported without significantly harming national competitiveness? What role is there for digital technologies in transforming industries, given the different regulatory framework for tech companies in Germany and the U.S. and the U.S.’ lead in digital services?

One key difference in contemporary policymaking discussions is a growing sense of directionality, that is, the idea that policymakers should set the direction of STI development, rather than leaving the market to set the course. But what role should government really play in setting that direction, and how, can ‘directional’ policy decisions be pursued in the highly federal political systems of countries such as the United States and Germany?

Panelists are invited to provide a short intervention on one or more of these themes, before opening the floor to a Q&A.

  • Speakers to be announced.
Final Remarks and Outlook
  • Robert Atkinson, President, ITIF
  • Andrew Wyckoff, Director, OECD Directorate for Science, Technology, and Innovation; Caroline Paunov, Head of the Working Party for Technology and Innovation Policy, OECD; Luke Mackle, Policy Analyst, OECD
Questions for the speakers? Ask via Slido.

Speakers

Robert D.
Robert D. Atkinson@RobAtkinsonITIF
President
Information Technology and Innovation Foundation
Speaker
Luke
Luke Mackle@lukebmm
Policy Analyst
OECD
Speaker
Caroline
Caroline Paunov@carolinepaunov
Head of the Working Party for Technology and Innovation Policy
OECD
Speaker
Andrew
Andrew Wyckoff
Director for Science, Technology and Innovation
OECD
Speaker
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