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Italy has continued the structural reforms and fiscal consolidation undertaken since 2011 to put the economy on a sustainable growth path based on sound macroeconomic fundamentals. In 2013, the government launched Destination Italy, the national plan to attract FDI and improve the competitiveness of Italian enterprises.

Hot Issues

Hot Issues are major national STI policy priorities, as self-reported by countries in their responses to the OECD STIO 2014 policy questionnaire.

Improving the coordination of and participation to the governance

Italy’s research and innovation policy governance is the responsibility of the Ministry for Education, University and Research (MIUR) together with the Ministry for Economic Development (MISE) and the Presidency of the Council of Ministers. However, the regions, in the framework of the concurrency principle, can also develop local STI initiatives. The adoption of smart specialisation strategies by Italian regions such as Emilia Romagna and Puglia helps strengthen policy co-ordination and communication across different ministries and regional agencies and across a range of policy areas. The Italian government is also working to incorporate the objectives and priorities of the EU’s Horizon 2020 in its main policies. A strategic document, Horizon 2020 Italy, was approved in 2013 and provides the framework for aligning national targets with European research and innovation objectives and initiatives over the next seven years.

Improving overall human resources, skills and capacity building

Italy has one of the lowest shares of tertiary qualified, and of technology-problem-solving skilled adult population among OECD countries (Panel 1t, u), and its tertiary education expenditure is also very low (Panel 1s). The country faces a dearth of highly skilled human resources, in part because the most qualified may find better opportunities abroad. The multi-annual planning for 2013-15 addresses these issues and encourages universities to improve guidance and tutoring services for students. The poor correspondence between the higher education system and labour market needs further underscores a structural mismatch. To tackle the issue, the action plan for future youth employment, Italia 2020, aims to align higher education curricula better with the changing demands of industry and to promote technical vocational education. Since 2011, academics’ salaries and advancement have been frozen to contain public spending. However, to avoid further erosion of the human resource base for S&T and innovation due to unattractive career prospects and pay cuts, the most recent cuts in the public research budget safeguarded the jobs of professors, researchers and technicians. Since the university reform approved in 2010, significant efforts have also been made to strengthen researchers’ careers. A reform of doctoral education focused on a stimulating research environment, collaborative doctorates and internationalisation, was implemented in 2013. Moreover, the financial law 2014 includes a commitment to encourage inter-institutional mobility of Italian researchers. MIUR has recently adopted measures to encourage the mobility of researchers between universities and PRIs and to attract researchers from abroad.

Business innovation, entrepreneurship and SMEs

While BERD as a share of GDP is quite low, innovation outputs in terms international patenting and trademark registration are around the OECD medians (Panel 1f, g). Italian business sector performs slightly more than half of GERD, a low share for an industrialised economy. A set of innovative firms coexists with a large majority of small or micro enterprises with low productivity. The new Fund for Sustainable Growth, which replaced in 2013 the former Fund for Technological Innovation, supports business R&D with significant potential to affect national competitiveness. The 2013 Stability Law (L228/2012) introduced a tax credit on costs of R&D incurred by enterprises or enterprise consortia through contract R&D with public research bodies or direct investment in R&D.

Improving the framework conditions for innovation (including competitiveness)

Italy’s position on the Ease of Entrepreneurship Index is near the top of the OECD ranks, the sign of a favourable business environment for entrepreneurial activities and innovative ventures (Panel 1j). While young firms are reasonably active in patenting, venture capital is in severe short supply, which hinders the commercialisation of innovative ideas (Panel 1i, h). A 2012 Act of Parliament provided a new legislative framework to promote start-ups. During 2012-14, Italy made efforts to reduce the tax burden on and strengthen fiscal incentives for SMEs. Destination Italy also includes several measures to facilitate small and micro enterprises’ access to bank credit and equity financing, to support their internationalisation and to encourage venture capital investment.

Country Charts

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Selected Highlights

New challenges

Several initiatives to address societal changes were launched in 2013, including the new National Energy Strategy to 2020 and a special fund for youth employment in the green-economy sector. The national regulatory framework for renewable energies and energy saving was recently updated. MUIR has also issued a national position paper on an ageing society, based on analyses and suggestions from various stakeholders and the OECD CSTP discussions on this topic, to address the challenges arising from the ageing of the Italian population.

Universities and public research

Italy’s public R&D expenditure is below the OECD median, as is its research output in terms of international publications in top scientific journals and its level of international co-authorship (Panel 1a, c, q). However, it has a relatively high share of top universities. Industry-science linkages are poorly developed and PRIs and universities do not actively patent their research results (Panel 1o, p). To improve public research performance, a reform of funding mechanisms for and management of universities was approved by Parliament in 2010 and is being implemented, as is the reform of PRIs under MIUR launched in 2009. In 2013, MIUR allocated newresources under the Cohesion Action Plan (CAP) to strengthen public research infrastructures, particularly in the country’s southern regions.

ICT and Internet infrastructures

While Italy’s wireless subscription rate is close to the OECD median (Panel 1m), its overall ICT investment is significantly below the median (Panel 1k). The National Broadband Plan 2008-14 continues to serve as the main instrument for improving ICT services and infrastructures at the national level. A new Agency for Digital Italy was set up in 2012 to promote ICTs, with a focus on digitisation in the public sector. A strategic plan for the diffusion of ultra-broadband technologies in the southern regions was launched in 2013, and MISE was authorised in 2013 to allocate new funds for developing and disseminating digital technologies.

Clusters and regional policies

Business innovation performance varies across regions, and much R&D and innovation capacity is concentrated in Italy’s northern and central regions. In 2012 MIUR launched a national call for the creation and strengthening of technological clusters. A project to support regional governments in designing and implementing their smart specialisation strategies was launched in 2013.


Over 2012-14, Italy has reinforced its network of bilateral agreements for scientific and technological co-operation with partner countries, in particular with Sweden, renewed for the period 2014-16. Since 2013 the ICE-Italian Trade Promotion Agency, which replaced the former Institute for Foreign Trade, supports the internationalisation of Italian firms. Strengthening the internationalisation of Italian universities, PRIs and businesses is also an aim of Destination Italy.