A new economy

the long version

What is driving recent growth in OECD countries? Why is it that their levels of GDP per capita are no longer converging? Why is it that some countries, operating at the technological frontier, where advances are difficult, appear to be widening the gap? Whether or not it is appropriate to speak of a "new economy", innovation and technology play crucial roles. This study shows that success requires not some silver bullet, but a range of complementary factors that support the innovation-intensive growth exemplified by new information and communication technologies such as the Internet and Internet applications like electronic commerce. Supportive policies include those favourable to innovative start-ups and to financial systems able to support them, those that facilitate the reorganisation required to reap the full benefits of ICT, regulatory and institutional frameworks that facilitate links between science and industry, and efforts to train and obtain the necessary human capital, as well as public support for basic scientific research. While this study is far from exhaustive, it represents an important step in understanding the conditions under which economies flourish.