The role of firm and national level factors in fostering R&D cooperation: a cross country comparison

This paper explores the factors that affect firms\u2019 propensity to engage in R&D cooperation using a CIS-3 sample of innovative firms located in seven European countries. It performs the analysis separately for the manufacturing and the service sectors in order to examine whether there are specific features that shape the service firms\u2019 R&D cooperative behaviour in particular ways. Differences between the manufacturing and the service sectors in the cooperative behaviour of firms become much more evident once an appropriate structure of endogeneity is determined. We compare different countries because, so far, the empirical evidence produced comes from single countries or countries that are all quite homogeneous in terms of industrial structure. Instead, we consider also countries, such as transition economies, that have not been analyzed so far. We find that public subsidies positively affect firms\u2019 propensity to engage in R&D cooperation in all countries, but they seem particularly important to enhance firms\u2019 cooperativeness in the service sector. Implications for innovation policy are examined