Ireland’s innovation ecosystem is at a crossroads

Ireland's entrepreneurial landscape has recently come under the spotlight with the release of a new OECD report earlier this summer.

In a step toward understanding and enhancing entrepreneurship worldwide, the OECD has released its first-ever Entrepreneurial Ecosystem Diagnostics report—introducing a new framework and dataset to assess and compare the entrepreneurial environments of all 38 OECD member countries.

As the first edition of its kind, the report is both a benchmarking tool and a strategic resource for policymakers. It aims to identify systemic bottlenecks, guide targeted reforms, and foster more dynamic, inclusive, and resilient entrepreneurial ecosystems.

Departing from traditional rankings, this report presents a new OECD diagnostics tool for assessing national entrepreneurial ecosystems in OECD countries, adopting a multidimensional, evidence-based approach to understanding what drives entrepreneurship at the national level. Unlike previous efforts that relied on single indices, the OECD’s new methodology evaluates ecosystems through three core dimensions: inputs, outputs, and variation.

• Inputs: Encompasses ten foundational elements such as institutions, infrastructure, finance, talent, and culture, measured through composite indexes built from over 40 indicators.
• Outputs: Measures entrepreneurial performance, including startup rates and business survival.
• Variation: Assesses inclusivity and regional distribution, focusing on gender and geographic equity.

Each dimension is tracked at three time points to monitor ecosystem evolution and progress. This innovative methodology not only captures the complexity of what drives entrepreneurship but is also designed as a policy support tool, providing policymakers with robust, evidence-based insights to identify systemic bottlenecks and guide national strategies.

Ireland emerges as a strong performer in this inaugural assessment, demonstrating robust scores across several key input dimensions.

The country attains relatively high scores on the following metrics:

• Institutions: Evaluates administrative systems, regulations, and taxation that impact economic activity, focusing on corruption control, rule of law, market regulation, and tax rates.
• Intermediate Services: the availability of these services can reduce entry barriers for entrepreneurs, aiding them with marketing, pitching, network building, and connections with investors and customers.

These strengths are reflected in Ireland’s high startup activity and strong start-up survival rates, positioning it among the top-tier entrepreneurial ecosystems in the OECD.

Ireland’s lowest scores are on the following metrics:

• Knowledge: Measures the knowledge base necessary for innovation, including R&D expenditure (GDP share), patents (per capita), and GitHub software uploads (per thousand people).
• Infrastructure: Assesses transport and telecommunications, with indicators on fixed subscriptions, mobile data usage, and transport quality.
• Culture: Captures entrepreneurial propensity and supportive social norms through indicators on career desirability, social status, and trust.

These can be interpreted as the weakest links in the ecosystem, which should be addressed first.  

The OECD emphasises that this diagnostic is a pilot edition, laying the groundwork for future iterations with even deeper data and refined methodologies. For Ireland, the findings offer both validation and a roadmap.

While the country is performing well, the report also identifies areas for continued improvement, such as enhancing entrepreneurial culture, appropriate infrastructure and expanding the availability of a substantial knowledge base.