An Assessment of Regional Innovation Capacity as a Factor of Economic Growth of Romanian Regions

Abstract

Abstract According to Regional Innovation Scoreboard 2016, Romania’s regions, including the Bucharest-Ilfov region, are classified as modest innovators. This paper’s objective is to identify certain potential ways of economic growth of the Romanian regions through its innovation absorptive capacity and innovation development capacity, according to the AC/DC model of the National Endowment for Science, Technology and the Arts (NESTA), UK. Using the 2016 pillar scores of the Regional Competitiveness Index (RCI) - Innovation sub-index, we analyze their compatibility with the NESTA model and assess the potential of Romanian regions to absorb external innovation. The paper proposes a qualitative and quantitative approach based on empirical evidence. The poor performances of the Romanian regions regarding innovation, as they were analyzed in this paper, draw attention to Romania’s need to exploit innovation brought in from abroad. The main conclusion of our analysis is that Romania has failed to reach the absorption threshold of innovation that would allow it to accelerate the value-creating processes. The ability to innovate completes the ability to absorb. A detailed analysis of the causes of the reduced absorption capacity could also provide solutions for accelerating economic growth. We also formulate policy recommendations to increase Romania’s regional competitiveness through the development of innovation capacity.