How to survive an economic crisis? Lessons from the innovation profiles of EU regions. European Commission

Whereas the European project has long been described as a 'convergence machine', the recent economic crisis has halted convergence in certain dimensions, and triggered divergence in others. By exploiting a dataset that includes patents, trademarks and design registrations at the regional level (NUTS2) in the period 2007-2016, this report aims to identify the different innovation profiles of European regions. Moreover, we also investigate to what extent the innovation profiles of regions have contributed to their resistance to the shock brought by the 2008 economic crisis, as well as their paths of economic recovery in the aftermath of the crisis. Innovation did help to sustain employment both during the economic downturn as well as in the aftermath. The most resilient regions are those that have a strong performance in the three intellectual property rights (IPRs) analysed; patents, trademarks and design. This suggests the presence of comparative advantages for those regional innovation systems which couple technology-intensive innovation in manufacturing with a strong service-intensive sector. Evidence also suggests that European regions should no longer be divided into the advanced regions in the West and the lagging-behind regions in the East. There is a group of regions in Eastern countries that is consistently improving its innovation performance, while growing disparities in innovation arise within the EU-15 countries.