Northern and Southern Innovativity: A comparison across European and Latin-American countries

This paper compares the role of innovation and economic performance across European and Latin American countries, using firm level data from France, Spain, Switzerland, Argentina, Brazil and Mexico. We implement a standard structural model linking R&D intensity, innovation and productivity. We find evidences revealing structural differences between regions, but also presence of heterogeneity within regions. In particular, firms tend to face innovation activities to achieve a better economic performance in similar terms along regions, but their interaction with national systems and environments is weaker in developing countries. A heterogeneous effect of foreign subsidiaries is found regarding innovativity whereas it induces better productivity in every country.