Theoretical and Applied Economics (Dec 2019)
Business R&D investments in the EU: Main dynamics and economic effects
Abstract
Research and development expenditures are known as drivers of innovation and productivity. This paper aims at investigating two interrelated aspects of business R&D investments in the EU: the main features and trends in business R&D investments and their impact on company′s performance. The results from preceding descriptive analysis on the most recent dynamics in the EU’s R&D investments indicate the persistence of several characteristics highlighted also in the literature, such as an increasing business R&D intensity gap between the EU and its main competitors, large differences registered in the total R&D investment intensity across EU countries, sectors and firms and industrial R&D concentration at the level of a few players. The positive impact of R&D investments on company’s performance in terms of net sales and operating profit is shown by conducting several econometric models. We also investigate whether the size has an effect on the R&D investments performed by companies exploiting data from the EU industrial R&D investment Scoreboard.
