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R&D Policy and Technological Trajectories of Regions: Evidence from the EU Framework Programmes

Wolf-Hendrik Uhlbach, Pierre-Alexandre Balland () and Thomas Scherngell

No 1722, Papers in Evolutionary Economic Geography (PEEG) from Utrecht University, Department of Human Geography and Spatial Planning, Group Economic Geography

Abstract: It is widely acknowledged that new technological specializations of regions are to a large extent driven by the recombination of existing knowledge and capabilities. Since this process is path-dependant and self-reinforcing, it can easily lead to technological lock-ins. A key issue is therefore to evaluate whether public policy can impact technological trajectories of regions and how it can be more effective. To address this issue, we analyze quantitatively and systematically the relation between R&D subsidies and new technological specializations of European regions from 1999 to 2010. R&D subsidies are identified by using the EU Framework Pro- grammes (FP) from the EUPRO database, and matched with patent documents from the OECD-REGPAT database. Using a fixed-effects linear probability model, our results indicate that FP participations have a positive but relatively small effect on the development of new specializations of regions, and that it can compensate for a lack of local related capabilities. We also find evidence that R&D subsidies have the highest impact if the level of relatedness with the new technology is neither too low (policy can not build a cathedral in the desert) nor too high (if all the capabilities are already present there is no need for policy).

Keywords: Regional Diversification; Technological Change; R&D subsidies; EU Framework Programmes (search for similar items in EconPapers)
JEL-codes: O31 O33 O38 O52 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-cse, nep-eur, nep-geo, nep-ict, nep-ino, nep-sbm, nep-tid and nep-ure
Date: 2017-09, Revised 2017-09
References: View references in EconPapers View complete reference list from CitEc
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