Policy-makers in low-income countries are increasingly aiming for a different and higher-quality type of growth. This growth should be more technology intensive, with a diversified production structure, be resilient to shocks, create jobs and be more inclusive.

Crucial for this is enhancing economic transformation, defined as the movement of resources from low-productivity to high-productivity activities. However, empirical evidence on how much is already happening and how to enhance this process is often scarce or lacking altogether in low-income countries.

This report synthesises the latest and most relevant research from the DFID-ESRC Growth Research Programme (DEGRP) on innovation, putting it in context within an emerging body of evidence on economic transformation.

Report by the Overseas Development Institute