classes across all sectors and all EU Member States, we identify different innovation profiles based on a firm's R …&D investment and/or innovation activities. We find that "basic" firms - i.e. firms that do not engage in any type of R&D or … innovation - are more common among young SMEs, while innovators - i.e. firms that do R&D and introduce new products, processes or …

In this paper we carefully link knowledge flows to and from a firm's innovation process with this firm's investment … results indicate that firms with small budgets for innovation will not invest in basic research. This occurs in the short run …