Featured Story February - April 2019
The European Innovation Paradox Revisited

By Dr. Maria Argyropoulou, Research Fellow

The debate about the European Paradox, started in 1994 with the publication of 'The European Report on Science and Technology Indicators' and summarised concerns about the research outcome in Europe. Further supported in 1995 by the European Commission Green Paper on Innovation, the same arguments underlined that the European Union's capacity to innovate is hampered by its inferiority in terms of transforming its excellent research output and scientific achievements into innovations and competitive advantages (European Commission, 1995).

The Paradox conjecture, however, has received a lot of criticism as many authors questioned its existence arguing that it had been based on a wrong measure, i.e., the number of European publications (Albarr?n et al., 2010; Bauwens et al., 2011, Dosi et al., 2006). Simple counts of papers do not show an objective picture of scientific performance. Consistent with these arguments, Rodr?guez-Navarro and Narin (2016) put forth that important scientific achievements are expressed by highly and very highly cited papers, Nobel level papers, and by Nobel prizes.  Other papers also supported the thesis of weak European performance especially when compared with the US (Leydesdorff and Wagner 2009; Leydesdorff et al. 2014). Similarly, Hammadou et al. (2014) supported the scepticism concerning the existence of the European Paradox, as their research findings confirmed that the European Science and Technology System lags behind the US and Japan when considering both the value of the research publications and the innovation output.

The positive aspect of the paradox, i.e., strong research output, has not been confirmed, whereas the negative part of the paradox remains, i.e., that Europe lacks the entrepreneurial capacity of the US to transform the research excellence into innovation, growth, wealth and jobs (Herranz and Ruiz-Castillo, 2013).

What can be done to remedy this situation?

A good start would be a transformation of the policies for the European higher education. Europe has a long tradition in higher education. Universities in Bologna, Oxford, Cambridge, Paris, and many more, were there long before the discovery of America (Chia, 2014). It is time for this rich tradition to be exploited systematically and sufficiently to shape a strong research and business future.  A higher degree of flexibility in the management of Universities will have a positive impact on their research performance as argued by several authors (Bauwens et al., 2011; Kr?ger et al., 2018). Political interventionism and micro management of universities as seen in many European countries create instability, and resource and policy confusion that hamper the long-term focus needed to develop excellence in any scientific field.

Building flexible processes for research funds promoting basic science and invention is also a recommended practice to boost technological innovations. The innovation process should be facilitated by letting entrepreneurs and industrialists innovate, creating common standards and rules across Europe, respecting and cherishing the needs of all indispensable players in the entrepreneurial ecosystem. One example of a move towards funding agile institutions is through the establishment of a Technology Office within the Government, headed by a Chief Technology Officer (CTO). The CTO should possess a strong technical and business background, coupled with significant field experience in operational positions. The Technology Office would handle funds that could be granted to Research and Development projects in all industries, on the basis of matching funds from the private sector; thus, government grants will be paid in parallel to private money spending.

Finally, yet importantly, Europe should support cutting-edge basic research and can create consensus around specific research agendas. CERN is a striking example of great research accomplishments carried out through an excellent intergovernmental organisation, with 20 member states focusing on a sufficiently clear and targeted, yet broad in terms of knowledge development agenda. Europe needs many similar organisations supported by a new global research and innovation collaborative culture to power bold goals that transcend borders and create synergies (European Commission, 2018).  Europe is facing grand changes, and the Horizon 2020 attempts to reflect the policy priorities addressing the concerns of the European citizens. The new 'challenge-based approach' will bring together scientists and researchers from diverse backgrounds, thereby establishing links with the policies and strategies of European Innovation Partnerships. Perhaps the renewed agenda's European goal to become the global innovation powerhouse can be operationalised with the use of a system dynamics model, grounded in the 'motors of innovation' as developed by Walrave and Raven (2016). This might provide the opportunity for academics and scientists to work together with the right mix of instruments in a more innovation friendly and less bureaucratic environment. 

In Summary

The European universities and research centres can become major actors in knowledge creation and therefore the promoters of economic growth and social development. The university-industry linkage should be reconsidered in Europe and the traditional role of teaching and research should be enhanced to serve the industry by means of commercialisation of innovative ideas and technology produced in R&D laboratories (Etzkowitz and Leydesdorff, 2000). This way, the European Paradox will be revitalised but with both its positive and negative aspects properly influenced: Research output would be stronger and this would be evident in all counts and metrics, while innovation would drive wealth creation through novel entrepreneurial actions and business ventures.

The article is based on:
Argyropoulou, M., Soderquist, K. E., & Ioannou, G. (2018), "Getting Out of the European Paradox Trap: Making European Research Agile and Challenge Driven", European Management Journal, in Press. On-line: https://www.sciencedirect.com/science/article/pii/S0263237318301208



References

Albarran, P., J. Crespo, I. Ortuno, and J. Ruiz-Castillo (2010). "A Comparison of the Scientific Performance of the U.S. and Europe at the Turn of the 21st Century", Scientometrics, 85(1), 329-344.

Bauwens, L., Mion, G., and Thisse, J.-F. (2011). The Resistible Decline of European Science. Recherches ?conomiques de Louvain, 77(4), 5-31.

Chia, R. (2014). Reflections on the distinctiveness of European management scholarship. European Management Journal, 32(5), 683-688.

Dosi, G., Llerena, P. and Labini, M. S. (2006). The relationships between science, technologies and their industrial exploitation: An illustration through the myths and realities of the so-called `European Paradox' Research Policy, 35(10),1450-1464;

Etzkowitz, H. and Leydesdorff, L. (2000). The dynamics of innovation: From National Systems and "Mode 2" to a triple helix of university-industry-government relations. Research Policy, 29(2), 109-123.

European Commission (1994). First European report on science and technology indicators. Luxembourg: Directorate-General XII, Science, Research, and Development, Office for Official Publications of the European Community ISBN 92-826-9010-5. https://publications.europa.eu/en/publication-detail/-/publication/803a9908-3e8c-4367-96db-e3a9868a8125/language-en

European Commission (1995). Green Paper on Innovation.   http://europa.eu/documents/comm/green_papers/pdf/com95_688_en.pdf Accessed 2 August 2018

European Commission (2018). Communication from the commission to the European Parliament, the European council, the council, the European economic and social committee and the committee of the regions A renewed European Agenda for Research and Innovation - Europe's chance to shape available at https://ec.europa.eu/commission/sites/beta-political/files/communication-europe-chance-shape-future_en.pdf Accessed 2 August 2018

Hammadou, H., Paty, S. and Savona, M. (2014). Strategic Interactions in Public R&D across European Countries:  A Spatial Econometric Analysis. Research Policy, 43(7), 1217-1226.

Herranz, N., and Ruiz-Castillo, J. (2013). The End of the European Paradox. Scientometrics, 95(1), 453-64.

Kruger, K., Parellada, M., Samoilovich, D. and Sursock, A. (Eds.). (2018). Governance Reforms in European University Systems: The Case of Austria, Denmark, Finland, France, the Netherlands and Portugal (Vol. 8). Springer.
Leydesdorff L. and Wagner W. (2009) 'Is the United States Losing Ground in Science? A Global Perspective on the World Science System', Scientometrics , 78 pp  23-36.

Leydesdorff l., Wagner C. S. and Bornmann L. (2014) 'The European Union, China, and the United States in the Top-1% and Top-10% Layers of Most-Frequently Cited Publications: Competition and Collaborations', Journal of Informetrics , 8 pp 606-617
Rodr?guez-Navarro, A. and Narin, F. (2016). European Paradox or Delusion-Are European Science and Economy Outdated? Science and Public Policy, 45(1), 14-23.

Walrave, B. and Raven, R. (2016). Modelling the dynamics of technological innovation systems. Research Policy, 45(9), 1833-1844.



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