– prepared by Tomasz Napiórkowski SGH-WERI
Commitment 6 is devoted to increasing the level of innovation in Europe by increasing investments in research and innovation activities and in human capital development. Specifically, this means focusing on funding and/or increasing efficiency through better allocation of existing resources. The first part of the study (i.e., the literature review) was aimed at answering the following key questions: 1) What is Commitment 6, what problems does it address and what are its objectives and proposed solutions? 2) What is the economic theory underpinning the programme tools under C6? 3) Are the programme tools under C6 backed by empirical studies? The aim of the second part of the study (i.e., empirics) is to test the following hypothesis: “H1: There is a positive impact of FP7 and CIP programmes on innovation in the EU via (H1a) increase in human capital growth and (H1b) increase in research and development activity stimulation and therefore on economic growth; hence, competitiveness.”
The results of the literature review (in addition to serving as a base for the following empirical studies) suggest that, as much as there is a positive relationship with human capital stimulation, there may be some additional work required in order to ensure that the stimulation of R&D activities has a positive impact on the actual innovation output, as the coefficient of this relationship might not turn out to be positive.
The most interesting findings of the literature review were as follows:
- Programmes under Commitment 6 positively stimulate innovation via proper resource allocation / dedication to growth in human capital and R&D investment / activities.
- The positive aspects of human capital development and interaction between various agents in the innovation eco-system appear to be unquestioned.
- The empirical support for public R&D investments or R&D subsidies appears to be mixed.
- Public support for R&D activity should focus on small firms and look for projects that (if successful) would bring the biggest social benefit, as opposed to allocating funds to big firms (some of whom do not need it) and minimizing the investment risk.