A taxonomy of European innovation clubs
Ariel L. Wirkierman, Tommaso Ciarli & Maria Savona
#2021-020
The paper provides a novel, empirically grounded map of innovation
'clubs' in the EU, based on a unique analysis of micro-aggregated,
country-level data. Using exploratory factor analysis we articulate
innovation variables in a taxonomy of four 'latent' innovation theories:
Network-Innovation-System, Kaldorian, New-Growth-Theory, and
Schumpeterian. We then characterise clusters of countries ('clubs'),
based on their performance against this taxonomy, and design a new map
of EU innovation clubs. We identify an articulated map of EU innovation
hierarchy beyond the rather well-known 'core-periphery' structure, and
interpret how some of the peripheries are functional to the
'consolidated core' of innovative countries, raising an issue of
long-term sustainability of such hierarchies. We also find that even the
most innovative clusters show concerning weaknesses. The strongest
cluster in terms of its innovation system does not seem to exploit its
full potential and lags behind with respect to radical product
innovations. Instead, the leading cluster in terms of radical product
innovations is strongly dependent on external innovative activity, is
focused on scale-intensive sectors, and has a fairly weak innovation
system. The periphery of small countries that show a healthy network
structure, do so because they mainly include supplier-dominated firms,
reliant on innovation inputs from the core. We offer some reactions on
innovation policy within a broader view of EU cohesion.
JEL classiffication codes: O30, O52, C38
Keywords: Innovation theories, National Innovation System, Exploratory
Factor Analysis, European cohesion policy