Innovation and invention in the EU business sector: the role of the R&D expenditures

Ján Huòady () and Peter Pisár
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Ján Huòady: Matej Bel University in Banska Bystrica, Faculty of Economics, Banská Bystrica, Slovakia
Peter Pisár: Matej Bel University in Banska Bystrica, Faculty of Economics, Banská Bystrica, Slovakia
Authors registered in the RePEc Author Service: Jan Hunady

Interdisciplinary Description of Complex Systems - scientific journal, 2021, vol. 19, issue 2, 168-188

Abstract: The article deals with the problems of business innovation and inventions in the EU countries with a focus on the potential effects of business R&D expenditure. Since the business is considered an essential sector concerning innovation, business R&D expenditure can play a significant role in their creation. However, several obstacles hinder the successful transformation of R&D expenditures into invention or innovation. R&D expenditures as any other type of business investments are associated with a certain risk. In this case, the risk of failure can be even higher due to their long-term nature and complexity. The article aims at an examination of the short-run and long-run relationship between business R&D expenditure, on one hand, an invention, and innovation on the other. To achieve this, the tests of Granger causalities and panel cointegrated regression has been applied on macro-level data. Furthermore, the structure of R&D expenditure in EU countries has been also examined. The results suggest a positive correlation between business R&D expenditure and innovation activities as well as the positive causal effect of business R&D expenditure on patenting in the long run.

Keywords: innovation; business R&D expenditure; invention; business innovation; patenting (search for similar items in EconPapers)
JEL-codes: M21 O30 O31 (search for similar items in EconPapers)
Date: 2021
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Persistent link: https://EconPapers.repec.org/RePEc:zna:indecs:v:19:y:2021:i:2:p:168-188

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