New paper: R&D Programmes, Policy Mix, and the ‘European Paradox’: Evidence from European SMEs

by Dr Dragana Radicic and Prof Geoff Pugh

Using a sample of small and medium-sized enterprises from twenty-eight European countries, this study evaluates the input and output additionality of national and European Union (EU) R&D programmes both separately and in combination. Accordingly, we contribute to understanding the effectiveness of innovation policy from the perspective of policy mix. Empirical results are different for innovation inputs and outputs. For innovation inputs, we found positive treatment effects from national and EU programmes separately as well as complementary effects for firms supported from both sources relative to firms supported only by national programmes. For innovation outputs,we report no evidence of additionality from national programmes and cannot reject crowding out from EU programmes. However, crowding out from EU support is eliminated by combination with national support. These findings have policy implications for the governance of R&D policy
and suggest that the European paradox—success in promoting R&D inputs but not commercialisation— is not yet mitigated.

Key words: R&D support; SMEs; policy mix; input and output additionality; European paradox

Science and Public Policy, 2016, 1–16
doi: 10.1093/scipol/scw077 

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