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"EU - Problems and Perspectives"
EU - Problems and Perspectives
Cinthia De Ruiz
Part 1: R&D Investment for the

Knowledge-Based Economy

Scientific and technological knowledge and its wide dissemination

play a vital role in the knowledge-based economy. It is widely

agreed that research and development (R&D), along with the

availability of a highly skilled workforce, the creation of an intense

interplay between the stakeholders of national innovation systems,

and the effective use of information and communication technologies,

are the key conditions for successful innovation and the competitiveness

of advanced economies.

The capacity to create and apply knowledge has become more important

in the production of goods and services. On the one hand,

production is more research-intensive, drawing on the utilisation

of research findings; on the other hand, it is technology-intensive,

drawing on the exploitation of new technology, and on the command

of the knowledge base of advanced and tailored services and

complex production processes.

This part of the document first examines the investments that various

countries are making in R&D, and the main sectors making

those investments. Secondly, some key figures on Community

funding of research by means of the Framework Programmes are

presented. Thirdly, since in most countries the business sector plays

the most important role in terms of R&D spending, private investment

will be examined in more detail. As venture capital (VC)

investment ¨C from private as well as public sources ¨C becomes more

and more important for the creation of new firms and employment,

key data on VC investment will conclude this part.

Key findings

¡ö Since the mid-1990s, the gap in R&D financing between the EU

and the US has almost doubled in volume terms. The gap is

mostly because the growth in R&D activities in the main EU

economies has been low by comparison to that in the US,

especially in France, the UK and Italy.

¡ö There are substantial differences between Europe and its

main competitors in the structure of their R&D funding. In

the EU, while governments account for a much larger share

of R&D investment than in the US and Japan,...

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