Institutional Stability And Its Impact Upon Country-Level Indicators Of Innovation In Selected EU Member States

Abstract :

Innovation and Research&Development (R&D) investment represent key aspects of development policies in the European Union. In modern economies, R&D involvement plays an important role in the process of building competitive advantage and innovation at national, regional, and enterprise level. The outstanding significance of R&D activities is not only clearly emphasized in EU strategies of development (Lisbon Strategy, Europe 2020), but also reflected in the ongoing project of the Sustainable Europe 2030 strategy. All of the above documents seem to emphasize perception of R&D activities as sources for the development of Europe as an area integrating highly competitive economies built on the fundament of knowledge. In Poland, country-level indicators of innovation (regardless of the adopted methods and indices, and also in terms of national levels of R&D expenditure) place the economy at the decidedly lower end of scale among the EU Member States. This poor ranking may be the effect of disturbances in the national institutional system, defined here as a combination of varied formal institutions subject to intergenerational pace of development and informal structures characterized by a more intragenerational pace of change (Williamson, 2000). Poland’s poor performance in the studied dimension may also be related to some other systemic disturbances, both internal and external, including high pace of change and institutional volatility, lack of institutional clarity, or the lack of complementarity between institutions (both in national and international perspective) which may affect the stability of the institutional system or produce disturbances in its operation, and ultimately produce disincentives and obstacles barring the effective development of R&D initiatives. The main objective of this paper is to present evidence for correlation between country-level indicators of innovation and the stability of national institutional systems. The study was conducted using public information on state-level indicators of innovation, R&D expenditure, and institutional stability from selected EU Member States. ?