European Technology Policy

Jonathan Eaton, Eva Gutierrez and Samuel Kortum

No 315951, Institute for Economic Development from Boston University

Abstract: European countries do less research than Japan and the United States. We use a quantitative multi-country growth model to ask: (i) Why is ~his so? (ii) Would there be any benefit to expanding research in Europe? (iii) y&.at would various European research promotion policies do? We find that: (i) Europe's lower research effort has more to do with the smaller markets facing European inventors than with lower research productivity. (ii) Europe has substantial research potential in that increased research effort in most European countries generates bigger income benefits there than in.creased effort in the United States and Japan of equivalent amounts. (ill) Policies to stimulate research in Europe raise productivity not only there but elsewhere. But a problem with pursuing these policies at the national level is the potential for free riding. A second possible problem with promoting research is distributional: While all countries within the European Union benefit, the countries that are already best at doing research, which tend to be the richer members, fare best. The benefits of policies that facilitate the adoption of innovations are more evenly spread.

Keywords: Research; and; Development/Tech; Change/Emerging; Technologies (search for similar items in EconPapers)
Pages: 52
Date: 1998
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Related works:
Journal Article: European technology policy (1998)
Working Paper: European Technology Policy (1998)
Working Paper: European Technology Policy (1998)
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Persistent link: https://EconPapers.repec.org/RePEc:ags:bouied:315951

DOI: 10.22004/ag.econ.315951

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