ABSTRACT
The impact of private investment in R&D on fundamental variables for economic growth has been studied for several decades (Solow, 1957; Griliches, 1979). Many studies have shown a positive impact from private R&D investment on firms’ productivity and competitiveness. In addition, private R&D investments are important in shaping the sectoral specialisation of countries, thus implying a crucial role for national and supranational policies for supporting these activities. In other words, it has become more and more evident how R&D policies can help firms in determining the best strategies for their growth, which are then expected to have a positive effect on the entire economy. Although such a relationship is not linear and is dependent on many exogenous factors, the importance of implementing R&D as well as innovation policies has been widely acknowledged at both the country and the EU level (O’Sullivan, 2007).
