R&D in Europe: Sector Decomposition of Sources of (in)Efficiency

Abstract

Measuring the efficiency of research and development (R&D) expenditure and innovation policy has gained attention in recent years. This research examines the efficiency of 29 selected European countries for the period ranging from 2007 to 2017 in achieving and obtaining R&D goals. The methodology applied is the data envelopment analysis approach with the inclusion of the missing data approach. The contributions of this research include the following: dynamic analysis is conducted to track changes of (in)efficiencies over time; the decomposition of the efficiency is done by separating the main variables of interest into the private, higher education, and government sectors; and the robustness of the results is evaluated, which is often ignored in the literature. The results of the analysis are discussed with possible directions for inefficient countries. The rankings provided in the empirical part of the study confirm previous findings on disparities between the European countries with respect to innovation and the R&D sector.

Research and Development Efficiency in Public and Private Sectors: An Empirical Analysis of EU Countries by Using DEA Methodology

“…Results of Conte et al [63] indicate large cross-country differences in terms of measured efficiency. Some authors, such as Skrinjaric [23], confirmed different results in measuring efficiency when choosing different indicators and units. The efficiency results in the individual countries depend on an evaluation of an indicator, input or output, or on a model that was used (input-oriented, output-oriented, or non-oriented).…”

“…The analysis results of R&D efficiency in EU countries indicate different trends in the area of R&D in the private and public sectors. There are many other authors ( [23,58,63]) who evaluated R&D in the public sector (higher education and government sectors) and private sector in the European context by using similar input and output indicators as were used in this research. Also, Aristovnik [64] and Hu, Yang, and Chen [28] (as in our study) used expenditure on R&D and the number of full-time researchers as input indicators when assessing the efficiency of R&D by DEA method, and the number of scientific publications indexed in the Science Citation Index as output indicators.…”

“…As Skrinjaric [23] states, obtaining information from sector disaggregation is important from a perspective of private research (private business sector R&D). Preservation of the industrial base in Europe and its competitiveness with private R&D, and similarly the excess of private R&Ds to higher education and greater adoption of new technologies, are the main reasons.…”

“…In research, it may essentially be used to test research performance by measuring whether the ratio of research output/input may be optimised, by comparing, for example, to other research programmes and/or countries (external benchmarking), or to the previous years' performance (internal benchmarking) [34]. Skrinjaric [23] examined the efficiency of 29 select European countries for the period ranging from 2007 to 2017 in achieving and obtaining R&D goals. The author conducted dynamic analysis and tracked changes of (in)efficiencies over time.…”

Assessment of Research and Development Financing Based on the Strategies in EU: Case of Sweden, Slovakia and Romania

“…These have already achieved better results in the field of innovation, so the concentration of R&D among market leaders is increasing and form barriers to entry for small and medium enterprises [47]. Generally, SMEs have a problem with finding resources in terms of funds, people, knowledge, and other factors needed for innovation and R&D [48][49][50]. Based on the reasons above, it will be necessary to monitor the area of R&D funding, the structure of their resources, as well as to analyze and compare the size of funds used to support these areas from the business enterprise sources, public (government) sources, or foreign sources in the coming years with Agenda 2030.…”