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Cohesion and Excellence. Two ways to a better Europe?

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  • Werner Hölzl

Abstract

European enlargement has created new challenges for European RTI policy-making, as it led to increased economic disparities among member countries. These differences are reflected in the interests of member countries with regard to EU innovation policy. The major discussions on the future of EU RTI policy relate to the size of the EU budget, the share allocated to the Framework Programme, the share allocated to cohesion policy and the orientation of the Framework Programme. Member states which are closer to the technological frontier have an interest in moving EU RTI policy towards "excellence", while countries that are far from the technological frontier call for a stronger orientation towards cohesion. This study finds that European RTI policy needs to be coherent and be based on sound rationales. By applying basic results from the economic theory of federalism it is shown that the multi-level nature of governance of RTI is here to stay. Policy fields where economies of scale and/or externalities are predominant should be allocated at the EU level while policies where heterogeneity of preferences is high in comparison should be allocated to the national (or sub-national) level. This is reflected by EU policy. The Framework Programmes are (mainly) oriented towards EU-wide public goods, while structural and cohesion funds are (mainly) oriented towards capacity building. The rationales, goals and mechanisms of cohesion policy are inherently different from the rationales and goals of the Framework Programmes. The overall impression is that the commission proposals are not over-ambitious, but on the right track. Excellence and cohesion are both required inputs to make Europe more sustainable in economic, political and technological terms.

Suggested Citation

  • Werner Hölzl, 2006. "Cohesion and Excellence. Two ways to a better Europe?," WIFO Studies, WIFO, number 28810, April.
    • Handle: RePEc:wfo:wstudy:28810
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