Chapter 2: Some Reflections on Innovation Policy
2. Some reﬂections on innovation policy Luc Soete In my view, the new Lisbon Strategy to prepare Europe for globalization must recognize, in much greater depth than suggested in the chapter by Maria João Rodrigues, that Europe is just one region in the world, and that it has various characteristics that make it particularly vulnerable to emerging global competition. There is increasing recognition of these characteristics, which include: demographic factors (an ageing population with low fertility rates); the failure to take full advantage of the scale oﬀered by European integration; and national governance prerogatives in areas of research and development (R&D), innovation, education and employment, so that there are too many overlapping tools and too little subsidiarity. The Lisbon initiative constituted a unique attempt to deal with what we can call an institutional failure in the formation of the European Union (EU). Up until that initiative, there were only two areas where Europe dominated national powers institutionally: competition policy and monetary policy (in the case of the eurozone countries). It is arguable that competition policy has an internal dynamic leading to a continuous broadening of its inﬂuence: an enlargement of the sphere of market forces, further harmonization of rules (such as the services directive or the European patent proposals). While this is likely to enhance eﬃciency in general, it has not contributed directly to knowledge accumulation or greater innovation within the EU. On the contrary, competition policy has generated growing legal uncertainty in Member...
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