RESEARCH AND DEVELOPMENT AND COMPETITIVENESS IN SOUTH EASTERN EUROPE: ASSET OR LIABILITY FOR EU INTEGRATION?

This paper explores the relationship between research and development (R&D) and competitiveness of the SEE economies from the perspective of the EU integration and the EU as a knowledge based economy. Specifically, paper addresses the question of whether SEE is a potential asset or a liability in this process. SEE countries are quite diverse in terms of levels of competitiveness, with visible effects on the role of R&D which is confirmed by analysis of the demand and supply factors of R&D. Although tentative, results show that innovation policy that takes account of the supply and demand side factors of R&D is essential to knowledge based growth in the SEE economies. This poses some limits to traditionally defined S&T policy as a sectoral activity and calls for new approaches, which are discussed in the paper.