Albert G. Zeufack - World Bank ERF 25th Annual Conference Knowledge, Research Networks & Development Policy 10-12 March, 2019 Kuwait City, Kuwait

1. Albert G. Zeufack
Chief Economist, Africa Region
The World Bank
Plenary 2: THE ROLE OF KNOWLEDGE IN THE
PROCESS OF INNOVATION IN THE NEW ECONOMY
How the Rise of the Intangibles Economy
is Disrupting Work in Africa
ERF 25th Anniversary Conference, March 10-13
Kuwait

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SOURCE: WDR 2016 team; http://www.internetlivestats.com/one-second/ (As compiled on May 29, 2015)

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5. From the WDR 2019: The Changing Nature of Work
The New Superstar Firms Trade Intangibles
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Source: Author’s calculation, based on data from Safaricom, KCB Bank Group, AirBnb, Marriot International Inc., Financial Times.
New Superstar Firms: digital platforms operating globally, existing in the cloud

6. …And Their Growth is Exponential
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Source: Authors’ analyses based on Walmart Annual Reports, Statista.com, NetEase.com

7. Changing how people work and the terms on
which they work
 LESS standard long-term
contract
 MORE short-term work often
via online work platforms
 BUT the numbers are still
small: total freelancer
population is 84 million, or less
than 3 percent of the global
labor force
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8. United States and Canada:
4,500 Genetic Counselors
• Master’s degree in Genetics
• Relevant certification
• Empathy
• Critical-thinking skills
• Decision-making
• Communicate complex
findings
India:
4 million App Developers
• Degree in Computer Science
• Experience in programming languages
and platforms
• Keep up-to-date with new technologies
• Work effectively as a team member
• Analytical, communication and
interpersonal skills
China:
100,000 Data Labelers
• Proficient in internet
use, data processing,
Microsoft suites
• Attention to detail
• Willing to learn
• Teamwork
Changing the nature of skills needed to succeed:
Advanced and Socioemotional Skills in demand
Source: Ormond et al. 2018; ifeng.com; Business Insider Intelligence, 2016; career websites.

9. Mazzucato’s Myths
• “Innovation is about R&D”
There are very few studies which
establish that innovation carried out by
small or large firms actually improve
their growth performance. Macro
models of innovation and growth, both
shumpeterian and new-growth theory
do not have strong micro-foundations.
• “We live in a knowledge economy—
just look at the patents”
A rise in patents’ number does not
necessarily reflect a rise in innovation.
It often captures change in patent laws
and a rise in strategic reasons why
patents are used.
Stiglitz: “IPRs: A social Construct?”
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10. Maloney’s Paradox
• High returns but low investments in
developing countries; extensive
market failures requiring higher
capability governments, but low
capacity governments…
• What to do about it?
1. Avoid R&D Fundamentalism
and focus on complementarities
2. Building firms’ capabilities
3. Building government
capabilities to manage
innovation
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12. …. It’s Already Happening!
How Intangibles (computerized
information, innovative property,
economic competencies) are
disrupting work in Agriculture and
Health in Africa

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14. The end of Farming as usual?
•In Nigeria and Kenya, HELLO TRACTOR; 22,000
farmers served to date, with reported 200%
increase in yields;
•e-Agriculture extension services: more than 1.2
million across the continent now have access to
best farming practices from videos on their cell
phones.
•Blockchain and rural finance and supply chain
management
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15. Example 1: SoilCares Scanner
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16. SoilCares Scanner
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17. Example 2: Hello Tractor
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18. Examples: Hello Tractor
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19. Examples: Hello Tractor
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20. Examples: Hello Tractor
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22. Potential impact of disruptive technologies in the AFS by 2030
Disrupting the Agriculture and Food System in Africa
Source: WEF 2018. Innovation with a purpose: The role of technology innovation in accelerating food systems transformation

23. Fast growing DT Agri- entrepreneurs in Africa
PromotingValueChain
Linkages
CreatingEffectiveProduction
Systems
Internet of Things
and Smart Sensors
Mobile Service
Delivery
Big Data and
Advanced Analytics
Precision
Agricultur
e
Biological-based Crop
Protection and
Micronutrients for Soil
Management
Renewable Energy
Generation and Storage
for Access to Electricity
Drone
Optimize
d- Input
Acre Africa
Agritech AgroSpaces Apollo Agriculture
Farmcrowdy HelloTractor ICT4Dev Kilimo Salama
M-Farm Ojay Greene Plan-a-head Sokopepe
Institute for Grape and Wine Sciences
Aerobotics Aerobotics DroneScan Syecomp
InteliSeed
AgriProtein Real IPM Wanda Organic
Futurepump Illuminum Greenhouses SunCulture Thermogenn Wakati
Zenvu
s
ThirdEye
UjuziKilim
oo
AfriSoft AgroCenta
Esoko-Tulaa Farmerline
iProcure Kitovu
Mobbisurance Oradian Pula
Twiga Food WeFarm

24. In the health industry, Rwanda is reaping the benefits of the
digital dividend. The government formed a partnership with
Zipline in October 2016 to deliver blood (for transfusions)
and vaccines to hospitals and clinics via drones in a timely
manner.
Over 11 million Rwandans have access to health care not
only in its live form but also in digital form. Babylon (a
British telemedicine firm) along with the ministries of
health, youth, and ICT, launched a mobile-based healthcare
scheme. This service provides access to high quality
healthcare by mobile phone, including cutting edge artificial
intelligence symptom checking and live phone consultations
with trained nurses and doctors. Prescriptions can also be
sent to the patient’s phone.
Disrupting Health Care in Rwanda

25. WDR 2019 Africa Companion Report:
A Research Agenda
• Technology as a potential enabler of the future of work in African countries
• The challenges and productivity potential of informal enterprises. the adoption
of low-skill-biased digital technologies complementary to less sophisticated
workers in African countries offers the potential of a poverty-reducing trajectory
by enabling low-skilled workers to learn and perform higher-skilled tasks,
increasing incomes of informal workers, and creating more job opportunities.
• The human capital challenges and productivity potential of a rapidly growing
labor force. Digital technologies can compensate for lower skills and be one
vehicle (together with “analog complements”) for boosting human capital
through their impact especially on the quality of education through schooling
and learning by working as well as by supporting better health outcomes,
including avoiding stunting and improving child and adult survival.
• Potential of risk-sharing social protection policies. DT can be leveraged to
increase efficiency, transparency and accountability in tax administration and
business support policies to provide a comprehensive set of risk-sharing policies
that guarantee a minimum level of support for the poorest.
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26. THANK YOU
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27. • Innovation can be defined as the ability to use knowledge to develop
and apply new ideas that result in changes in the production and
organizational structure of the firm.
• Schumpeter (1934) defined several of these applications that qualify
as innovation:
1. Introduction of a new product or modifications to an existing product
2. A new process or technology in an industry
3. The discovery of a new market
4. Development of new sources of supply of inputs and raw materials
5. Changes in industrial organization
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28. Innovation Paradox
• First, avoid R&D Fundamentalism. The scope of the NIS in developing economies
must be larger and include everything that affects the accumulation of all types
of capital—physical, human, and knowledge—and their supporting markets.
What looks like an innovation problem, such as a low rate of investment in
R&D, may reflect barriers to accumulating other factors, including physical and
human capital. Although R&D is an important input for innovation, it requires a
set of capabilities that are unlikely to be prevalent in developing countries and its
promotion cannot be at the expense of the other investments in the capabilities
escalator.
• Second, building firms’ capabilities. Firm managerial and technological
capabilities are a central complementarity to narrowly defined innovation
expenditures, and their cultivation is critical to fomenting a continual process of
technological adaptation and quality upgrading. This implies a rebalancing of
policy priorities toward management and technology extension instruments and
away from a focus mostly or exclusively on promoting R&D.
• Third, building government capabilities to manage innovation. the complexity
and problems in constructing a functional NIS and building private sector
capability are greater in developing countries, whereas government capabilities
to manage them are weaker. Innovation policy thus needs an honest balancing of
capabilities with tasks, which requires working on a selective set of issues rather
than trying to import a full set of institutions and policies from elsewhere.
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