EU Facing Innovation Gap

Sources:

Innovation Union Scoreboard 2010

LA Times: EU Failing to Catch Up With US, Japan in Innovation, Waiting for its Sputnik Moment

BBC: EU Sees Alarming Innovation Gap For European Firms

FT: Industry Warns Europe on Competitiveness

This week, the European Commission released its "Innovation Union Scoreboard 2010," a collection of data providing an assessment of the innovation performance of EU member states, as well as the strengths and weaknesses of their research and innovation systems. The report also includes indications of innovation in some non-EU states, including the United States, Japan, and China, in order to compare the relative advances between EU and non-EU states. The data uses research indicators to compare each country's performance in areas including research systems, funding for innovation, new doctoral degrees, and use of intellectual assets.

The data shows that Europe trails the United States and Japan in investments and new patents, with Brazil and China close behind. Sweden is first in the EU for innovation, followed by Denmark, with the UK in fifth. Based on a series of indicators, the statistics show that the United States outperformed Europe by 49 percent last year, a four percent increase since 2007. The gap between Japan and the EU has also grown, with Japan outperforming the EU by 40 percent, up from 32 percent in 2006. The EU's complicated and expensive patent system, partly due to translation costs, is one cause of the lag in innovation in the EU. However, the EU is outperforming the U.S. in public research and development spending and exports of knowledge-intensive services. According to Commissioner Marie Geoghegan-Quinn, the data "highlights the innovation emergency in Europe." The EU Commission hopes that improved measures promoting innovation, including more private investment, will help the European economy emerge from the financial crisis.

At the end of this week, EU leaders will meet at an EU summit in Brussels to discuss the ongoing financial crisis in the Euro Zone and policies to improve innovation in the EU. Geoghegan-Quinn, while confident that the EU will rebound, argues that the most difficult task will be to convince member states to maintain or increase spending on research and development.

Discussion Question: What additional steps should Europe take to close the innovation gap between the EU and the United States?