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The Swedish Paradox

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Abstract

This paper sums up the debate about the Swedish ‘paradox’ and provides new evidence. The paradox thought has emerged in different versions, which share the common basics that Swedish R&D expenditures are high, but do not produce sufficient economic results. This empirical paradox is part of a more general debate concerning relations between R&D and growth. We show that the theoretical underpinnings of the paradox are rather weak. There is a long chain of different gears between R&D, high-tech and growth, which should lead to expectations of high variation among countries. Previous evidence suggests that Sweden appears to have problems in two of these gears, the entrepreneurial climate and innovation to high-tech production. We support this conclusion on new empirical results. First, we show that the high persistence in concentration of R&D to a few multinationals remains, which in itself is an indication of weak entrepreneurship. Second, Sweden is still behind the OECD in high-tech and medium-high-tech exports, given her R&D intensity, although she is catching up. Moreover, employment figures in the high-tech sectors point to a more favorable development. Academia has been suggested to be another weak component for interaction with business, but the empirical evidence is here scant and less transparent.

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  • Ejermo, Olof & Kander, Astrid, 2006. "The Swedish Paradox," Papers in Innovation Studies 2006/1, Lund University, CIRCLE - Center for Innovation, Research and Competences in the Learning Economy.
  • Handle: RePEc:hhs:lucirc:2006_001
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    1. Nigel Roome & Han van Kleef, 2007. "Developing capabilities and competence for sustainable business management as innovation: a research agenda," ULB Institutional Repository 2013/14319, ULB -- Universite Libre de Bruxelles.
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    Cited by:

    1. Olof Ejermo, 2011. "Locked into the ivory tower? Mobility and entrepreneurship among Swedish academics," ERSA conference papers ersa10p1413, European Regional Science Association.
    2. Andreas P. Cornett & Nils Karl Soerensen, 2011. "The Emergence of New Regional Convergence Clubs in a Nordic and Baltic Perspective," ERSA conference papers ersa10p628, European Regional Science Association.
    3. D.B. Audretsch & A.R. Thurik, 2010. "Unraveling the Shift to the Entrepreneurial Economy," Tinbergen Institute Discussion Papers 10-080/3, Tinbergen Institute, revised 02 Apr 2011.
    4. Pontus Braunerhjelm, 2007. "Academic entrepreneurship: Social norms, university culture and policies," Science and Public Policy, Oxford University Press, vol. 34(9), pages 619-631, November.
    5. Joern Block & Roy Thurik & Haibo Zhou, 2013. "What turns knowledge into innovative products? The role of entrepreneurship and knowledge spillovers," Journal of Evolutionary Economics, Springer, vol. 23(4), pages 693-718, September.
    6. Gabrielsson, Jonas & Landström, Hans & E. Thomas, Brunsnes, 2006. "A Knowledge-based Categorization of Research-based Spin-off Creation," Papers in Innovation Studies 2006/6, Lund University, CIRCLE - Center for Innovation, Research and Competences in the Learning Economy.
    7. Aalbers, Rick & Koppius, Otto & Dolfsma, Wilfred, 2006. "On and Off the Beaten Path: Transferring Knowledge through Formal and Informal Networks," Papers in Innovation Studies 2006/8, Lund University, CIRCLE - Center for Innovation, Research and Competences in the Learning Economy.
    8. Politis, Diamanto & Gabrielsson, Jonas, 2006. "Informal investors and value added: The contribution of investors’ experientially acquired resources in the entrepreneurial process," Papers in Innovation Studies 2006/12, Lund University, CIRCLE - Center for Innovation, Research and Competences in the Learning Economy.
    9. Giuliani, Elisa, 2006. "The uneven and selective nature of cluster knowledge networks: evidence from the wine industry," Papers in Innovation Studies 2006/11, Lund University, CIRCLE - Center for Innovation, Research and Competences in the Learning Economy.
    10. Ejermo, Olof & Kander, Astrid & Svensson Henning, Martin, 2011. "The R&D-growth paradox arises in fast-growing sectors," Research Policy, Elsevier, vol. 40(5), pages 664-672, June.
    11. Ejermo, Olof & Kander, Astrid, 2006. "Trends in R&D, innovation and productivity in Sweden 1985-2002," Papers in Innovation Studies 2006/9, Lund University, CIRCLE - Center for Innovation, Research and Competences in the Learning Economy.
    12. Schön, Lennart & Kander, Astrid, 2007. "Industrial dynamics and innovative pressure on energy - Sweden with European and Global outlooks," Papers in Innovation Studies 2007/5, Lund University, CIRCLE - Center for Innovation, Research and Competences in the Learning Economy.
    13. Ejermo, Olof, 2006. "Inventive and innovative activity over time and geographical space: the case of Sweden," Papers in Innovation Studies 2006/14, Lund University, CIRCLE - Center for Innovation, Research and Competences in the Learning Economy.
    14. Olof Hallonsten, 2014. "ERAWATCH Country Reports 2012: Sweden," JRC Working Papers JRC90739, Joint Research Centre (Seville site).
    15. Ejermo, Olof & Kander, Astrid, 2008. "The Swedish Paradox arises in Fast-Growing Sectors," Papers in Innovation Studies 2008/7, Lund University, CIRCLE - Center for Innovation, Research and Competences in the Learning Economy.
    16. Argentino Pessoa, 2007. "Innovation and Economic Growth: What is the actual importance of R&D?," FEP Working Papers 254, Universidade do Porto, Faculdade de Economia do Porto.
    17. Chaminade, Cristina & Edquist, Charles, 2006. "Rationales for public policy intervention from a systems of innovation approach: the case of VINNOVA," Papers in Innovation Studies 2006/4, Lund University, CIRCLE - Center for Innovation, Research and Competences in the Learning Economy.

    More about this item

    Keywords

    Sweden; paradox; R&D; growth; entrepreneurship.;

    JEL classification:

    • O30 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - General

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