"Innovation and European competitiveness: Benchmarking as a tool for competitiveness"

The Commission's general approach with regard to competitiveness is inspired by the 1990 Communication (Bangeman I), the White Paper (Growth, Competitiveness, and Employment) of December 1993 and the 1994 Communication (Bangeman II). The European Commission has repeatedly stressed the need to sharpen Europe's competitiveness. The latest proposal suggests Europe act to implement benchmarking as a tool for improving competitiveness. There are a number of reasons why the EU should become involved in benchmarking. First, the impact of policies developed at Union level which influence competitiveness must have as positive an effect as possible. Second, regular monitoring and evaluation against best practices is required to ensure that these policies are indeed providing the necessary benefits. Some insights can be gained by adopting an analytical framework which allows the identification of some of the critical issues to be considered in this debate. By highlighting how these policies work in practice toward the strengthening of competitiveness at community level, evaluating their complementarities and some of their inconsistencies, this framework can serve as benchmark to assess to which degree the objectives of the White Paper and other EU actions aimed at improving European competitiveness have been achieved, and illuminate policy makers on the roots of the existing problems in the way forward. The ability to sustain economic growth, increase its standard of living depends in many ways on EU's success in developing commercializing new products, processes, etc. Such concerns have prompted much debate about the proper role of the Commission in encouraging innovation and the commercialization of new technologies. To analyse how the EC promotes industrial benchmarking as a tool for identifying weaknesses and improving competitiveness, we first establish some facts on innovation, in particular how knowledge generation is location specific; second, what are the factors identified as determining the functioning of innovation systems; and the last section discusses policy issues.