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The innovation gap between “Old” and “New” European Countries

Author

Listed:
  • Antonella Biscione

    (Department of Economics, University of Molise, Campobasso-Italy, CESPIC, Catholic University ‘Our Lady of Good Counsel’, Tirana-Albania)

  • Maria Cipollina

    (Department of Economics, University of Molise, Campobasso-Italy, Centro Rossi-Doria, Università degli Studi Roma Tre, Roma-Italy)

  • Gianluigi De Pascale

    (Department of Economics, University of Foggia, Foggia-Italy)

Abstract

This paper investigates the drivers of disparities in firm innovativeness between the “New Europe” (countries joining the EU after 2004) and the “Old Europe” (EU members before 2004). Using firm-level data from the World Bank Enterprise Surveys (2018–2020 waves), we apply a Blinder-Oaxaca decomposition approach to identify the key factors behind these differences. Our findings show that firms in “Old Europe” benefit from better human capital, managerial experience, financial access, and stronger export orientation, all of which enhance firms’ innovation performance. On the contrary, firms in “New Europe” face constraints that reduce their innovation potential. In addition, institutional differences, such as lower political stability, weaker infrastructure, and higher perceived corruption, further contribute to widening the innovation gap between the two regions.

Suggested Citation

  • Antonella Biscione & Maria Cipollina & Gianluigi De Pascale, 2026. "The innovation gap between “Old” and “New” European Countries," Working Papers 1026, European Centre of Peace Science, Integration and Cooperation (CESPIC), Catholic University 'Our Lady of Good Counsel'.
    • Handle: RePEc:pea:wpaper:1026
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