The EU 2020 Innovation Indicator: A Step Forward in Measuring Innovation Outputs and Outcomes?

Abstract

Die Dis cus si on Pape rs die nen einer mög lichst schnel len Ver brei tung von neue ren For schungs arbei ten des ZEW. Die Bei trä ge lie gen in allei ni ger Ver ant wor tung der Auto ren und stel len nicht not wen di ger wei se die Mei nung des ZEW dar.Dis cus si on Papers are inten ded to make results of ZEW research prompt ly avai la ble to other eco no mists in order to encou ra ge dis cus si on and sug gesti ons for revi si ons. The aut hors are sole ly respon si ble for the con tents which do not neces sa ri ly repre sent the opi ni on of the ZEW. AbstractIn October 2013, the European Commission presented a new indicator intended to capture innovation outputs and outcomes and thereby "support policy-makers in establishing new or reinforced actions to remove bottlenecks that prevent innovators from translating ideas into products and services that can be successful on the market". This article aims to evaluate the usefulness of the new indicator against the background of the difficulties in measuring innovation outputs and outcomes. We develop a unique conceptual framework for measuring innovation outcomes that distinguishes structural change and structural upgrading as two key dimensions in both manufacturing and services. We conclude that the new indicator is biased towards a somewhat narrowly defined "high-tech" understanding of innovation outcomes. We illustrate our framework proposing a broader set of outcome indicators capturing also structural upgrading. We find that the results for the modified indicator differ substantially for a number of countries, with potentially wide-ranging consequences for innovation and industrial policies.

Sustainable growth of EU economies and Baltic context: Characteristics and modelling

“…And more: "…(innovation performance) ranking does not take specific economic and social conditions of the country into account" (Nasierowski and Arcelus, 2012). Several studies indicate differences in compliance of indexes with processes in high-and low-developed economies (e.g., Kordalska and Olczyk, 2016;Crespo and Crespo, 2016), or bias towards high-tech sectors (e.g., Janger et al, 2017) that indicate weaknesses of the methodologies.…”

Untitled

“…According to the Organisation for Economic Cooperation and Development (OECD) experts, services make a major contribution to employment growth and increased public well-being in many of the organization's member countries [OECD, 2017]. Within the service industry, knowledge-intensive business services (KIBS) demonstrate particularly high growth rates, including in developing countries [Janger et al, 2017]. In China, the added value created in KIBS industries grew more than fivefold between 2004 and 2014 [Fang et al, 2016].…”

Knowing where to go: The knowledge foundation for investments in renewable energy

“…One of the classical proxies for industry dynamics and innovation is firm level R&D expenditure. Generally, R&D expenditure measures an important source of input to the innovation process, albeit its relevance varies across industries, and it has been argued that only focussing on this indicator introduces a bias towards a narrow set of high tech industries [67]. Moreover, even if we were able to correctly identify RE related firms, in most cases only a part of firm level R&D activity will be dedicated to RE.…”