EU Regions and Multinational Corporations: Change, Stability and Strengthening of Technological Comparative Advantages

In a rapidly globalizing economy, and particularly in the face of a process of economic integration such as that occurring in the EU, regions forge an increasing number of linkages with other locations within and across national boundaries through the local technological development efforts of multinational corporations (MNCs). By using a database of patents granted to the largest firms by the US Patent and Trademark Office (USPTO), we have shown in previous research that the pattern of MNC networks for innovation conforms to an internal (within national boundaries) hierarchy of regional centres. In this paper the hypothesis of the combined significance of cumulativeness and incremental change in innovation is examined by testing the extent of continuity in the sectoral composition of technological profiles of different EU regional centres between the 1970s and the 1990s. The results provide support for our hypothesis that a geographical hierarchy of regional locations can be established also across national boundaries within the EU. It is shown that the core European regions can be divided into two kinds—those in which MNCs have consolidated areas of traditional specialisation for the regions in question, and those in which there has been a shift towards (and a relative growth of) the development of fields of high technological opportunities.