Evaluating the Reasons Behind the Inefficient Implementation of ERDF Devoted to R&I in SMEs

AbstractThis work is mainly aimed at evaluating the reasons behind the inefficient execution of Operational Programs (OPs) aimed at promoting research and innovation (R&I), especially in small and medium-sized enterprises (SMEs). To achieve this goal, we employed a three-stage slack-based measure (SBM) data envelopment analysis (DEA) model combined with Stochastic Frontier analysis (SFA), which includes a multiplicity of achievement metrics and environmental factors, to evaluate 53 OPs from 19 countries. Our findings suggest that more developed regions (proxied by a higher Gross Domestic Product (GDP) per capita) do not make an efficient application of European Regional Development Funds (ERDF) aimed at fostering R&I in SMEs. Also, a greater proportion of the population with a university degree does not imply an appropriate use of ERDF devoted to R&I in SMEs. Lifelong learning is positively linked with the performance of the outcomes “Researchers Working in Improved Infrastructures” and “Enterprises Supported”. Research and development (R&D) expenditures in the public sector contribute favorably to the needed improvements in “Researchers Working in Improved Infrastructures” but have the reverse effect on the number of “Enterprises Supported” and “Enterprises Working with Research Institutions”. Furthermore, because R&D expenditures in the business sector have a positive impact on the necessary development of “Enterprises Working with Research Institutions”, these results appear to demonstrate that public R&D has a weaker influence on SME innovation than private R&D. Finally, innovative SMEs collaborating with other sources of knowledge show a positive effect on both the number of “Enterprises” and “Enterprises Working with Research Institutions” supported.