Editions

There are many concerns about how artificial intelligence (AI) might impact communication and democratic processes adversely, as opportunities to the production of fake news are becoming more and more sophisticated. Yet AI also offers new ways to organise democracy. It could even enable direct democracy to be reinvented. Hans Gersbach (KOF) and César Martinelli (George Mason University) have been exploring these possibilities and they present one of its core ideas in this article.

Johannes Dahlke, Assistant Professor of Digital Innovation and Entrepreneurship at the University of Twente, KOF Research Fellow and former member of the Innovation Economics Section, talks in this interview about the potential of artificial intelligence and explains how technological change will affect the labour market and individual professions.

This article is a collaboration between man and machine. We conducted an interview with the ChatGPT voice software on economics, business cycle research and politics. KOF innovation researcher Mathias Beck and KOF co-director Hans Gersbach rank the quality of ChatGPT’s responses and its potential below.

The research landscape in Switzerland is becoming more diverse again. Smaller firms and companies offering modern services in particular are increasingly conducting research and development (R&D). This innovative business climate is making the Swiss economy more resilient to crises such as COVID-19.

New technologies are fundamentally changing the demand for labour in Switzerland and other countries. Is the Swiss workforce about to be replaced by robots, artificial intelligence and other digital technologies?

There is a renewed shortage of skilled labour in Switzerland. A recent study published in the Journal of Population Economics shows how computerisation is driving the Swiss economy’s demand for highly skilled workers. This trend is thus having a significant impact on what sort of people are immigrating to Switzerland.

Martin Wörter and Mathias Beck are examining the digital transformation as part of a research project funded by the National Research Programme (NRP). In this interview the two innovation economists explain why the coronavirus pandemic has accelerated computerisation and why Europe is still lagging behind the United States in terms of technology.

High-resolution aerial photographs – evaluated using machine-learning techniques – can be used to create success indicators for construction projects in Switzerland. Until now it has not been possible to measure whether planned construction projects have been implemented or not. The initial results of a KOF pilot project indicate that many construction projects have remained unfinished – especially in the wake of the 2012 second-home initiative.

Compared with female graduates in fields such as law and psychology, female STEM graduates have higher salaries one year after graduation, are more likely to have permanent jobs and are more likely to hold managerial positions. Even five years after graduation, four out of five female STEM graduates are in jobs that require a degree in their specialist field. Overall, female STEM graduates seem satisfied with their employment situation.

The coronavirus pandemic has clearly left its mark on Switzerland’s innovation landscape. More than a quarter of the firms surveyed by KOF have had to adapt their innovation processes significantly or even very significantly owing to the COVID-19 crisis. SMEs, start-ups and multinational corporations have been hit particularly hard. Just under half of these companies report that COVID-19 has meant a reduction in R&D and innovation investment and a decline in innovation collaborations.

This year’s investment outlook for Swiss firms has improved this spring compared with the autumn of last year. The results of the semi-annual KOF Investment Survey show that companies plan to increase their fixed capital investment by a nominal 7.5 per cent in 2022. These additional funds will primarily be allocated to construction projects. At the same time, environmental protection continues to gain in importance as an investment motive.

What sorts of firms have dropped out of R&D (research and development) and what consequences does this have for Switzerland’s economy? These questions are addressed both by the author and by the authors of the study ‘What Makes Firms Stop Doing R&D in Switzerland?’. This article focuses on the results of the first question: what types of companies have dropped out of R&D?

The seven major Swiss regions differ significantly in some cases with regard to production factors but not in terms of the results of the innovation process. The differences in input factors appear to be primarily due to structural factors. It is small firms in the construction and service sectors that cause these differences. At the same time, these types of firms make a smaller contribution to the results of the innovation process, which reduces the regional differences in innovation success.

Although more and more firms are recognising the benefits of digitalisation and are therefore investing in the corresponding technologies, this approach does not necessarily yield productivity gains. A new study by KOF shows how companies can improve their competitiveness by modifying their organisational structures and investing in information technology (IT).

Investment activity by Swiss companies slumped in 2020 as a result of the economic crisis caused by the coronavirus pandemic. The findings of the semi-annual KOF Investment Survey show that companies plan to catch up on some of their postponed investment projects in the second year of the pandemic. However, one in five firms lacks the financial resources to do so, which is slowing down their investment drives.

Companies usually hope that investing in digital technology will increase their competitiveness. However, there is no evidence of any direct correlation here. As a KOF study shows, innovation is needed in order to actually raise productivity through IT investment.

Swiss companies are increasingly being confronted with IT security problems. There are significant differences between the various corporate sectors in the area of cyber defence and, in some cases, there is a great deal of catching up to do. Effective IT security is a prerequisite for using digital technologies to increase productivity.

How high is the ‘start-up rate’ in Switzerland compared with other countries? What is the main motive for setting up businesses in Switzerland? What competences are particularly relevant for start-ups and what factors encourage innovation performance? This article provides an overview of the most important findings of KOF’s research on business start-ups in Switzerland.

There are frequent reports in the news suggesting that information and communication technologies lead to higher productivity especially for highly educated workers. However, most of the studies consider only the complementary effect of new technologies and tertiary educated workers. A new study investigates the effect these technologies have on workers with different levels of education.

Companies investing in product and production process innovations can achieve a significant increase in productivity, as shown by a study jointly conducted by KOF researchers and the German ZEW Institute. The correlation is particularly strong for companies that are subject to very high levels of international competition. Thus these investments evidently play an important role in securing competitive advantages.

A new database allows for the geolocation of global patent applications. Thanks to this database, technology clusters can be analysed and patent activities can be compared in different countries and cities. The data are also relevant to policymakers.

In the last few years, the percentage of Swiss companies engaging in research and development has been on the decline. Moreover, the percentage of companies coming up with process and product innovations is also dropping. Measured by these indicators, Switzerland has slipped into the European mid-range when it comes to innovation.

Swiss policy-makers are currently debating a raft of measures designed to adjust the country’s climate policy. Among other factors, the behaviour of enterprises plays an important role in this context. KOF studies have shown that the impact of energy policy measures on companies depends to a large extent on the prices of new energy technologies and on energy costs.  

Digital technologies represent a major challenge for the labour market. According to a new study, Swiss firms are investing in digitalisation, although this is resulting in the loss of some jobs. However, the process ultimately leads to the creation of more new jobs.

What role does culture play in the founding of businesses? A new study has investigated this question with reference to Swiss linguistic regions. It shows that entrepreneurialism is in fact characterised by cultural differences. Specifically, Swiss nationals hailing from German-speaking areas are more likely to start a business than their French-speaking compatriots.  

There are frequent reports in the news about data theft – with victims ranging from companies to politicians, as was recently the case in Germany. How well are Swiss companies protecting their data against attacks? Do bigger companies have better defences than smaller ones? The authors have followed up on these questions in the context of the KOF Innovation Survey.  

What is the trend in research and development (R&D) collaboration and technology sourcing between developed and developing nations? A new study shows that Europe is lagging behind the USA when it comes to the number of collaborations with developing nations

KOF has investigated investment activities in the Swiss economy in the period from 2014 to 2016 on behalf of the Swiss State Secretariat for Education, Research and Innovation (SERI). The survey was conducted among private companies in the industrial, construction and service sectors. It appears that innovation activities have become more difficult and costly for Swiss companies.

Is there any benefit for companies if other companies have foreign operations? A new KOF study suggests that “domestic companies” in Switzerland benefit from the R&D operations of other Swiss companies abroad, in relation specifically to both innovation and productivity.

“Without innovation, there is no business cycle movement” is a famous statement made by Joseph Schumpeter. In a new paper based on Swiss data, Andrin Spescha and Martin Wörter confirm this claim that there is a relationship between innovation and business cycle movements.

Following the last Bulletin’s article on the skills employers look for in their staff, our second article on the level of digitalisation in Switzerland focuses on possible digitalisation objectives pursued by Swiss companies. It was found that companies specifically hope to raise efficiency.

In the context of the first representative study on digitalisation, which was conducted in 2016, researchers at ETH Zurich and FHNW investigated the level of digitalisation at Swiss companies. Based on a new assessment of the survey, the first of two KOF Bulletin articles investigates which staff skills companies consider most relevant in the context of digitalisation. The researchers found that many employees actually lack the sought-after skills.

Bringing a product from idea to market is a stony and sometimes expensive process. The classic approach is to keep everything under wraps so that no competitor knows what you are doing. However, this approach is not always the best one, as new research by Georg von Krogh, Torbjørn Netland and Martin Wörter shows.

A large number of entrepreneurs in Switzerland say that free movement of persons is a key element in the success of their business. But has free movement of persons really made businesses larger, more productive and more innovative? A new KOF study shows that it has: businesses have indeed become larger and more innovative. In fact, due to free movement of persons, they are increasingly deciding to produce in Switzerland.

Swiss companies are still among the most innovative enterprises in the world. However, the percentage of innovators has declined. Among the companies that generate innovations, the innovation expenditure to turnover ratio has nevertheless gone up. These are the results of the tenth Innovation Survey of the Swiss Economy for the years 2012 to 2014.

Why businesses develop and implement new technologies – or why they don't: this question has been considered by an international team of researchers as part of the national research programme “Managing Energy Consumption”.