Executive summary

The topics of “innovation” and “modernising the rural economy” are closely related. OECD rural regions are highly connected to global markets and open to trade. Their growth potential depends on their capacity to modernise their economic base and to innovate, in other words to produce goods and services that can be sold at a profit in local and in international markets, and to introduce new sectors and new products. However, this exposure to greater competition from domestic and international markets sometimes comes without complementary policies that can help strengthen the capacity of rural areas to adapt. The focus on innovation and modernisation represents an important next step in the evolution of the OECD rural policy dialogue. The fact that it is widely believed that the future prosperity of rural regions will be driven by enterprise, innovation and new technologies, tailored to specific markets and applied to new and old industries, makes this discussion timely. Furthermore, focusing on the two pillars critical to revitalising rural areas – innovation and modernisation – is one way to identify factors that can trigger or facilitate improved economic performance and identify those that tend to weaken it.