Innovation performance in European regions: comparing manufacturing and services ICT subsectors

This paper investigates factors influencing regional innovation by contrasting high-tech manufacturing and knowledge intensive services. Based on regression analysis of European regions, we find the following consistent results for two separate years, 2001 and 2003: 1 High-tech manufacturing is relatively more significant than knowledge intensive services for regional innovation performance. 2 For high-tech manufacturing sector, local manufacturing employment is relatively more important than local R&D in determining regional innovation performance. 3 In contrast, for knowledge intensive services, local R&D activities appear to be relatively more important than local service sector employment in influencing regional innovation performance. 4 The significance of knowledge intensive services for regional innovation performance appears to be increasing. These imply that encouraging innovation in manufacturing sector needs focus on boosting the sector's employment, which may increase its supply of entrepreneurial people; while the service sector needs specific attention on R&D, which could boost the sector's innovativeness. © 2010 Inderscience Enterprises Ltd.