1. Economics and Policy of Innovation
Article Summary Kushev, Lyubomir Università degli studi di Trieste
Prof. Vittorio Alberto Torbianelli |1

2. “The R&D and innovation systems in Romania and Bulgaria in the EU context”
By Steliana Sandu, Zizi Goschin, Irina Anghel, Gloria Goschin,
Institute of National Economy, Romanian Academy |2

3. Content Introduction to the Article The R&D and Innovation Convergence
Downgrading
The R&D and Innovation Convergence
Main Factors of the innovation performance
The “Sigma convergence”, method applied for assessing the gap in R&D b/n former and newer EU countries
Absorption Capacity for knowledge as an important factor of innovation
convergence.
Conclusion

4. Downgrading What is the situation? What is the aim of the Article?
Key points of the article:
Catching-up analysis
Sigma Convergence
Absorptive Capacity
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5. Content Introduction to the Article The R&D and Innovation Convergence
What is the goal?
Factors
Main Factors of the innovation performance
The “Sigma convergence”, method applied for assessing the gap in R&D b/n former and newer EU countries
Absorption Capacity for knowledge as an important factor of innovation
convergence.
Conclusion

6. What is the goal?
Why is it important to close the gap between poor performers nad innovation leaders?
Methods for assessing the progress?
Problems?
“…the 2013 Innovation Union Scoreboard, an official document of the EC acknowledged not just static convergence, but even disturbances in the innovation convergence processes between the MS” (IUS, 2013, p.6)
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7. Figure 1
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8. Figure 2 (Innovation performance in Europe)
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9. Factors Former centralized R&D research systems
Restructuring of the governments after the 1990s
Lower R&D intensity after the crisis compared to the EU*:
EU average – 2,02%
Bulgaria – 0,65%
Romania – 0,39%
*measured as a share of expenditure for R&D in GDP
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10. Figure 3
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11. Distribution of the R&D expenditure by performance sector
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12. BERD indicator
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13. Companies’ investment in R&D
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14. Content Introduction to the Article The R&D and Innovation Convergence
Main Factors of the innovation performance
Enablers, Firm activities, Outputs
The “Sigma convergence”, method applied for assessing the gap in R&D
b/n former and newer EU countries
Absorption Capacity for knowledge as an important factor of innovation
convergence.
Conclusion

15. Enablers, Firm Activities, Outputs
Dimension relater to: HR
The R&D system and its science base
Finance and support
Firm Activities
Integrates the indicators expressing the innovation efforts at the company level:
Investments, both R&D and non-R&D
Potential generators of innovations at firm level
Entrepreneurial and collaboration efforts
Various form of IPRs
Outputs
Captures the firms’ innovation activities:
Innovators
Economic Effects
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16. Table 5
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17. Table 6
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18. Table 7
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19. Figure 8
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20. Content Introduction to the Article The R&D and Innovation Convergence
Main Factors of the innovation performance
The “Sigma convergence”, method applied for assessing the gap in R&D
b/n former and newer EU countries
What is “Sigma convergence”?
Absorption Capacity for knowledge as an important factor of innovation
convergence.
Conclusion

21. What is “Sigma convergence”?
Introduced by Barro and Sala-i-Martin in 1995, describes a process of abatement of the dispersion of the variable at stake, given cross-sectional data.
Simply put: Sigma convergence refers to the reduction of dispersion of levels of income across economies.
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22. Figure 9

23. Figure 11
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24. Figure 12
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25. Content Introduction to the Article The R&D and Innovation Convergence
Main Factors of the innovation performance
The “Sigma convergence”, method applied for assessing the gap in R&D
b/n former and newer EU countries
Absorption Capacity for knowledge as an important factor of innovation
convergence.
A bit about Absorption Capacity
Conclusion

26. A bit about Absorption Capacity
Evident interlacing between firm level and national level AC
Murovec and Prodan (2009)
Narula (2004)
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27. Table 10
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28. Content Introduction to the Article The R&D and Innovation Convergence
Main Factors of the innovation performance
The “Sigma convergence”, method applied for assessing the gap in R&D
b/n former and newer EU countries
Absorption Capacity for knowledge as an important factor of innovation
convergence.
Conclusion

29. Conclusion
“… we can say that budgets are management tools whose use contributes to the improvement of performance.“
“… But statistically speaking, the link between budgets and performance has not been validated through the economic model developed.“
“Budgets can explain 27% of the variation in performance.”
Bottom line (literally and figuratively):
“Therefore, we believe budgets are useful tools in the activity of economic entities that contribute to superior performance.”
Baroto (2012)

30. “Thank You For Your Attention!” -Lyubomir Kushev
Any Questions?
“Thank You For Your Attention!” -Lyubomir Kushev
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