Technology upgrading and growth in Central and Eastern Europe

Abstract

The R&D and technology issues of relevance for catching up cannot be understood or conceptualised only within the R&D based growth model. With this motivation in mind, we have created a composite indicator of innovation capacity and performance of the CEECs, as well as of the EU25, which is meaningful from the perspective of countries lagging behind the world technology frontier. Three conclusions stem from the Index of Technology Upgrading components which have major relevance for policy making. Firstly, we observe a decline in most of the EU25 economies of their production capabilities despite, on average, significant improvements in R&D and technology capability. This suggests that the EU has serious weaknesses in converting its R&D and technological knowledge into production capabilities. Secondly, the Index of Technology Upgrading components show improvements in infrastructure and structural changes in most of the EU economies, but an overall relative decline in firm capabilities. This shows the limitations of current EU supply oriented RDI policies which continue to reinforce the so-called European paradox. Thirdly, increased knowledge interaction between 2006 and 2015 has been confined to the German-led Central European manufacturing cluster. It seems that the EU RDI policy operates as a substitute for technology and knowledge exchange rather than as a complement to it.

The effects of EU R&I funding on SME innovation and business performance in new EU member states: Firm-level evidence

“…Technology upgrades and innovation that lead to the creation of new and competitive market products and services have been a pivotal issue in the economic growth of most new EU members from Central and Eastern Europe (CEE), especially since the global financial crisis. A number of empirical studies by authors familiar with the region (see Radošević, 2017;Radošević et al, 2020, Hashi & Stojčić, 2013aHashi & Stojčić, 2013b;Stojčić, 2020;Stojčić et al, 2020;Radas et al, 2020) have detected and investigated the issues behind its modest innovation performance and low productivity gains, despite the continuous increase in external R&I funding, including public funds from the EU and national sources.…”

“…Finally, Radošević suggests the use of appropriate innovation metrics that reflect CEE-specific innovation factors and technological upgrades, as those currently in use (such as the EU Innovation Union Scoreboard) focus more on R&D and technology. In his later work (Radošević et al, 2020), Radošević develops a specific composite innovation policy index -the Technology Upgrading Intensity Index -to better reflect the significant contributions of non-R&D factors in CEE countries.…”

The Determinants of Innovative Capacity in the Medical Sector in Central Europe and Across the European Union

“…We identify some differences among strong innovators (12 countries) and weak ones (15 countries) in importance of medical innovation drivers. Third, we separately analyze EU members from Central Europe, which are characterized by different technology upgrading patterns due to the disjunction between production capability, and R&D and technological capability (Kravtsova & Radosevic, 2012;Radosevic et al, 2019) and regarded as countries with emerging innovation systems (Stojčić, 2021). Our panel data-based econometric analysis provides the underpinning for understanding the factors that explain innovative productivity of the medical sector measured by patent applications.…”

Elite agency in the growth of offshore business services in Romania

“…Historically, the levels of public education and R&D spending across CEE have been quite low in comparison to high-income countries in Western Europe (Myant and Drahokoupil, 2011). Educational institutions have often been deemed inadequate in their capacity to meet the knowledge and skill content required by companies and unable to establish linkages with actors across different sectors (Radošević, 2006). Capik and Drahokoupil (2011) emphasise how regional innovation policies have been mostly ineffectively designed – insufficiently geared towards localised technological specialisation, lacking appropriate funding and with little R&D content.…”