What is a higher value-added economy?
20. The need to create a higher value-added economy is widely taken as a given in public policy debate but what exactly does this apparent platitude mean? Just as policy interventions can only be considered appropriately with an understanding of the real context, so it is necessary to understand exactly what the desired outcome, in this case a higher value-added economy, might be. As NESTA said, “A high value-added economy focuses on those activities that generate a large margin between the final price of a good or service and the cost of the inputs used to produce it, and thus create higher profits for businesses and higher wages for workers.”[16] 21. There are some sectors which are clearly higher value-added, such as pharmaceutical development and advanced engineering. However, a higher value-added economy may encompass a far wider range of activity. The Committee received a large amount of evidence exploring the concept. Here we reproduce some of the most eloquent submissions. 22.
