Improving the Regional Innovation Scoreboard for policy: how about innovation efficiency?

Abstract

Abstract This paper aims to improve the Regional Innovation Scoreboard as an instrument for policy-making. Dynamic slack–based models of data envelopment analysis to measure innovation output efficiency in 207 European regions demonstrate that the scale-based performance classification of the Scoreboard into ‘leader’, ‘strong’, ‘moderate’, and ‘modest’ innovator regions inadequately reflects differences in efficiency in transforming knowledge inputs into innovation outputs. We reveal a non-monotonic relation between scale-based and efficiency-based performance and substantial heterogeneity among the reasons for inefficiency among regions within each of the four scale-based performance classes of regions. Our findings argue for an extension of the current scale-based use of the Scoreboard by adding an efficiency-based measurement of the innovation process. Doing so addresses the tendency in policy design towards an increased focus on the efficient use of scarce resources in place-based policy approaches and strengthens the application of the Scoreboard as an informative decision-making tool.