Sectoral innovation systems, corporate strategies, and competitiveness of the German economy in a globalised world

The EU Barcelona target assumes a close causal relationship between corporate R&D, the competitiveness of business firms and the economic performance of industrial countries. Testing this hypothesis, this paper contrasts innovation and production activities in four research-intensive manufacturing sectors (chemicals and pharmaceuticals, motor vehicles, machinery, and electrical engineering). Starting point are observed long-term changes in world- wide value added of the manufacturing sector. The empirical analysis is based on a unique survey of R&D-intensive business firms in Germany and 50 personal interviews in large industrial companies. The results show that there is no simple connection between R&D and competitiveness. Moreover, the likely consequences of promoting R&D differ substantially between industries. -- Sectoral innovation systems ; corporate R&D Strategies ; chemicals and pharmaceuticals ; machinery ; electrical engineering ; motor vehicles ; bazaar effect