Title: Young leading innovators and the EU’s R&D intensity gap
Other Titles: MSI_1215
Authors: Cincera, Michele
Veugelers, Reinhilde
Issue Date: Sep-2012
Publisher: KU Leuven - Faculty of Economics and Business
Series Title: FEB Research Report MSI_1215 vol:MSI_1215
Abstract: Europe’s innovation gap relative to the US is often attributed to its industrial structure in which new firms do
not play a significant role, especially in high-tech sectors. This view of a structural EU innovation deficit is
popular in European innovation policy discussions, but has received little or no thorough empirical investigation. This paper aims to address this ‘evidence gap’. Using industrial R&D Scoreboard data from leading world innovators, we find that compared to the US, the EU has fewer young firms among its leading innovators. Using a decomposition analysis, we show that having fewer young firms accounts for about onethird of the EU-US differential in R&D intensity, while fifty five percent of the differential is due to the fact that young leading innovators in the EU are less R&D intensive than their US counterparts. Further analysis shows that this is almost entirely due to a different sectoral composition. We thus confirm that the EU-US private R&D gap is indeed mostly a structural issue.
Publication status: published
KU Leuven publication type: IR
Appears in Collections:Department of Managerial Economics, Strategy and Innovation (MSI), Leuven

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