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The geographical processes behind innovation: a Europe-United States comparative analysis


  • Riccardo Crescenzi
  • A. Rodriguez-Pose
  • Michael Storper


The United States and European Union differ significantly in terms of their innovative capacity: the former have been able to gain and maintain world leadership in innovation and technology while the latter continues to lag. Notwithstanding the magnitude of this innovation gap and the political emphasis placed upon it on both sides of the Atlantic, very little systematic comparative analysis has been carried out on its causes. The empirical literature has emphasised the structural differences between the two continents in the quantity and quality of the major ‘inputs’ to innovation: R&D investments and human capital. The very different spatial organisation of innovative activities in the EU and the US – as suggested by a variety of contributions in the field of economic geography – could also influence innovative output. This paper analyses and compares a wide set of territorial processes that influence innovation in Europe and the United States. The higher mobility of capital, population, and knowledge in the US not only promotes the agglomeration of research activity in specific areas of the country but also enables a variety of territorial mechanisms to fully exploit local innovative activities and (informational) synergies. In the European Union, in contrast, imperfect market integration, and institutional and cultural barriers across the continent prevent innovative agents from maximising the benefits from external economies and localised interactions, but compensatory forms of geographical process may be emerging in concert with further European integration.

Suggested Citation

  • Riccardo Crescenzi & A. Rodriguez-Pose & Michael Storper, 2007. "The geographical processes behind innovation: a Europe-United States comparative analysis," Departmental Working Papers of Economics - University 'Roma Tre' 0081, Department of Economics - University Roma Tre.
  • Handle: RePEc:rtr:wpaper:0081

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    References listed on IDEAS

    1. Jaffe, Adam B, 1986. "Technological Opportunity and Spillovers of R&D: Evidence from Firms' Patents, Profits, and Market Value," American Economic Review, American Economic Association, vol. 76(5), pages 984-1001, December.
    2. Michael Storper & Anthony J. Venables, 2004. "Buzz: face-to-face contact and the urban economy," Journal of Economic Geography, Oxford University Press, vol. 4(4), pages 351-370, August.
    3. Peri, Giovanni, 2005. "Skills and Talent of Immigrants: A Comparison between the European Union and the United States," Institute of European Studies, Working Paper Series qt78t8m1n7, Institute of European Studies, UC Berkeley.
    4. François VANDAMME, 2000. "Labour mobility within the European Union: Findings, stakes and prospects," International Labour Review, International Labour Organization, vol. 139(4), pages 437-455, December.
    5. Vernon Henderson, 1999. "Marshall's Economies," NBER Working Papers 7358, National Bureau of Economic Research, Inc.
    6. Josephine Anne Stein, 2004. "Is there a European knowledge system?," Science and Public Policy, Oxford University Press, vol. 31(6), pages 435-447, December.
    7. Attila Varga, 1998. "Local academic knowledge spillovers and the concentration of economic activity," ERSA conference papers ersa98p493, European Regional Science Association.
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    Cited by:

    1. World Bank, 2012. "Reshaping Economic Geography of East Africa : From Regional to Global Integration (Vol. 1 of 2)," World Bank Other Operational Studies 11930, The World Bank.
    2. Dobronogov, Anton & Farole, Thomas, 2012. "An economic integration zone for the East African Community : exploiting regional potential and addressing commitment challenges," Policy Research Working Paper Series 5967, The World Bank.

    More about this item


    Innovation; Research and development; Regions; Spillovers; Agglomeration; Systems of innovation; European Union; United States;

    JEL classification:

    • R11 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Regional Economic Activity: Growth, Development, Environmental Issues, and Changes
    • R12 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Size and Spatial Distributions of Regional Economic Activity; Interregional Trade (economic geography)
    • O32 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Management of Technological Innovation and R&D
    • O33 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Technological Change: Choices and Consequences; Diffusion Processes


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