Europe 2020 and Varieties of Capitalism: Complementary or Contradictory?

Abstract

A central ambition of the Lisbon Agenda and Europe 2020 is promoting greater innovation in Europe. This paper investigates three questions: How have EU efforts to foster innovation affected innovation finance? How has European financial market integration affected innovation finance? And, are some kinds of capitalist (innovation) systems favored by financial market integration and EU policies? We find, overall, there has not been a clearly sustained increased in R&D spending by governments or firms in Europe. National capitalisms and their innovation systems have nonetheless changed in important ways, one of which is the emergence of strong segments for radical innovation and finance in some coordinated market economies. But rather than finding convergence across national capitalisms and innovation systems, we find increased diversity within national economies and blurring across national boundaries.

Keywords: innovation policy, EU, financial markets, varieties of capitalism

JEL Classification: L22, L52, F15, F36, P16, P51