The RHOMOLO and FIDELIO interim evaluation of the impact of Horizon Europe

Pablo Casas, Tryfonas Christou, Valeria Ferreira, Abián García Rodríguez, Nicholas Joseph Lazarou, Luis Enrique Pedauga, José Manuel Rueda Cantuche, Hannah Bernard, Roberto Volpe, Daniel Neicu and Simone Salotti

MPRA Paper from University Library of Munich, Germany

Abstract: This paper presents a macroeconomic evaluation of the impact of the Horizon Europe Framework Programme for Research and Innovation, for which projects have been signed between 2021 and 1 July 2024, using the general equilibrium models RHOMOLO (Regional Holistic Model) and FIDELIO (Fully Interregional Dynamic Econometric Long-term Input-Output). The RHOMOLO model simulations suggest that the GDP gains in 2024 for the European Union would be up to 0.10% compared to GDP in 2020. The GDP gains are also expected to be significant in the medium term, with a cumulative GDP multiplier of more than 4, ten years after the end of the injection. The impact then gradually diminishes due to the obsolescence of the new knowledge and innovations generated by the policy intervention. The model results also show significant interregional spillovers in some, but not all, countries of the European Union. The FIDELIO model is used to disaggregate the impact of Horizon Europe funds on EU R&D expenditure and by sector, complementing the analysis of the RHOMOLO model. The results indicate that the positive effects on innovation gains, with business investment contributing to substantial GDP gains after the four-year intervention period, are mainly directed towards business R&D in manufacturing. Within manufacturing, the most important sub-sectors are the manufacture of machinery and equipment; computer, electronic and optical products; motor vehicles, trailers and semi-trailers; and fabricated metal products.

Keywords: Innovation policy; regional growth; industry impact; general equilibrium. (search for similar items in EconPapers)
JEL-codes: C68 O30 R13 (search for similar items in EconPapers)
Date: 2025-05-06
New Economics Papers: this item is included in nep-eec, nep-ppm and nep-sbm
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