The Growth Effects of R&D Spending in the EU: A Meta-Analysis

Ari Kokko, Patrik Gustavsson Tingvall, Josefin Videnord

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    Abstract

    In this paper we conduct a meta-analysis to examine the link between R&D spending and economic growth in the EU and other regions. The results suggest that the growth-enhancing effect of R&D in the EU15 countries does not differ from that in other countries in general, but it is less significant than that for other industrialized countries. A closer inspection of the data reveals that the weak results for the EU15 stem from comparisons with the US – the US has been able to generate a stronger growth response from its R&D spending. Possible explanations for the US advantage include higher private sector investment in R&D and stronger public-private sector linkages than in the EU. Hence, to reduce the “innovation gap” vis-à-vis the US, it may not be enough for the EU to raise the share of R&D expenditures in GDP: continuous improvements in the European innovation system will also be needed, with focus on areas like private sector R&D and public-private sector linkages.
    Original languageEnglish
    JournalEconomics
    Volume9
    Issue number2015-40
    Pages (from-to)1-26
    ISSN1864-6042
    DOIs
    Publication statusPublished - 2015

    Keywords

    • Meta-analysis
    • R&D
    • European Union
    • EU15
    • US
    • Economic growth

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