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The EU vs US corporate R&D intensity gap: investigating key sectors and firms
[A primer on innovation and growth]

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  • Pietro Moncada-Paternò-Castello
  • Nicola Grassano

Abstract

This paper presents a firm-level examination of the European Union (EU) vs US research and development (R&D) intensity differences based on four pictures taken during the time span 2005–2017. It contributes to the literature on the topic by inspecting for the first time which sectors and firms account the most for the aggregate R&D intensity performance of these two economies. Analyzing the top 1250 R&D investors worldwide in four different years, it finds that (i) only few companies within key (for their relative impact on the overall R&D intensity) high-tech sectors determine (positively and negatively) the bulk of the sector’s intensity, (ii) the EU holds a much lower number of both larger and smaller R&D investors than the United States in the key high-tech sectors, and (iii) there is a high heterogeneity in firms’ R&D intensity within such key sectors. These findings are crucial to better understand the aggregate transatlantic corporate R&D intensity gap.

Suggested Citation

  • Pietro Moncada-Paternò-Castello & Nicola Grassano, 2022. "The EU vs US corporate R&D intensity gap: investigating key sectors and firms [A primer on innovation and growth]," Industrial and Corporate Change, Oxford University Press and the Associazione ICC, vol. 31(1), pages 19-38.
    • Handle: RePEc:oup:indcch:v:31:y:2022:i:1:p:19-38.
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    JEL classification:

    • O30 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - General
    • O32 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Management of Technological Innovation and R&D
    • O38 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Government Policy
    • O57 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - Comparative Studies of Countries

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