Measuring the Quality of Regional Innovation Systems: A Knowledge Production Function Approach

This article deals with applying the knowledge production function approach to the measuring and the comparison of the quality of regional innovation systems. It is argued that an embeddedness in a well-functioning innovation system should result in a relatively high propensity to innovate and a high productivity of efforts in research and development (R&D). Based on data for eleven European regions, the author has found a number of such statistically significant differences between the manufacturing firms in these regions. Interregional differences in the productivity of R&D activities correspond to some degree with a center-periphery paradigm, which can be found in the literature. Obviously, there exist considerable agglomeration economies that are conducive to R&D activities.