Does Europe Perform Too Little Corporate R&D?

Keith Smith

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     Last modified: February 28, 2007

Abstract
It is often argued, both in policy circles and by analysts, that the EU is characterised by a failure to perform adequate levels of business R&D. One problem in assessing such claims is that R&D data is often presented in the form of highly aggregated indicators (such as overall R&D/GDP ratios), and public policy targets are often selected on the basis of such indicators. However R&D indicators of this type are in fact a complex outcome of firm strategies, company demographics, sectoral structures, and macroeconomic dynamics. These underlying determinants of R&D intensity need to be considered in assessing comparative performance.