Study: innovation and internationalisation closely related

In the framework of the PRO-INNO project INNO GRIPS II, a study has been prepared on “Barriers to internationalisation and growth of EU’s innovative companies” under the lead of WIFO. The findings of the study have been validated by an expert workshop held in Brussels on 28 September.

The 285 page final study report is now available to the public for download.

The three analytical chapters of the report show that internationalisation and innovation are closely related. Barriers to innovation therefore act also as barriers to internationalisation, and trade barriers on the other hand have also a negative impact on innovation.

This implies that policies supporting innovation and internationalisation should be linked up or be designed in such a way that they stimulate innovation and internationalisation at the same time. The authors suggest that a systematic EU-wide screening of existing national export promotion programs and innovation support measures be done. This could then become an important source for policy learning at EU level.

The removal of barriers to innovation will positively affect the internationalisation efforts of innovative firms, whereas the elimination of barriers to internationalisation is likely to foster innovation activities of firms. The study of the barriers to innovation and the barriers to internationalisation supports the view that innovation and internationalisation are two sides of the same coin. Indeed, firm specific barriers to innovation and firm specific barriers to internationalisation are largely congruent. The results show however also that the perception of barriers varies across countries. Firms in technologically more advanced countries are more likely to perceive both innovation and internationalisation barriers as more pressing because they are also more heavily engaged in these activities, and also because the principal drivers of innovation differ across these country groups. This calls for a differentiated policy approach.

Another important qualification emerging from the analysis is that it is possible to identify in the CIS noninnovators that do not engage into innovation and internationalisation because they perceive certain barriers that force them to limit their engagement in these activities. They are distinct from non-innovators or firms that do not internationalise because they operate on local markets and have no intension to expand their activities beyond their regional or national reach. Hence, the former group represents an important target for policy that should be addressed in a more focused way.

Background:

“INNO-Grips” (short for “Global Review of Innovation Policy Studies”) is supporting policy makers in adopting appropriate policy responses to emerging innovation needs, trends and phenomena. It analyses framework conditions, barriers and drivers to innovation and innovation policy and offers intelligence on international developments in these fields.

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