High-growth firms in European countries: The role of innovation

Abstract

This paper analyses the role that R & D and innovation has on the likelihood of a firm becoming a High-Growth Firm (HGF). The microdata is from the Community Innovation Survey provided by Eurostat, it covers the period 2008-2010, and we classify the EU countries into three clusters: Core countries, Mediterranean countries, and New EU Members. Our results show that there are large differences between each cluster. Technological innovations promote the likelihood of Core countries becoming an HGF, non-technological innovations are a key determinant for Mediterranean countries, and in New EU members the drivers are more related to firm characteristics and international trade.