Strategic R&D and patent behaviour in some EU-countries

Abstract

This paper will be focused on two issues. Firstly, entrepreneurial innovative behaviour will be explained and, investigating the corresponding literature, it will also be concluded that innovation can reasonably be explained by patent behaviour. Secondly, because of the essential role of R&D spillovers, these will be considered in greater detail. In this respect, strategic R&D behaviour of private enterprises will be analysed under the occurrence of spillovers. Based on imperfectly competitive product markets, optimal R&D and output strategies are mutually compared. A test for various EU countries is provided using the average propensity to patent (APP) as a crude measure for the absence of spillovers. This test is applied on a panel of 22 sectors using OECD, EPO and EUROSTAT data for Belgium, Denmark, Germany, Italy, the Netherlands and the United Kingdom over the sample period 1989-1995. It is found that (coherent) long-run forecasts for the number of patent applications are feasible for Denmark and Germany but not for the other four EU-countries considered.