Regulatory barriers and firm innovation performance
Although the effects of regulatory barriers on the economy through the generation of incentives have been widely discussed, the impact of complying with regulations and the effects on innovation are less well documented. Due to the lack of statistical data on regulatory costs across the EU and sectors, the present study uses company perceptions of regulatory costs to identify the impact on a broader scale than has been done in the past. It achieves this through analysis of the Community Innovation Survey (CIS) microdata which contains responses from more than 70 000 companies across Europe.... The focus of the approach centres on the quantification, to the extent possible, of perceived regulatory costs on company innovation, competitive performance and market strategies. Empirical evidence suggests that companies’ perception of regulatory cost as an obstacle is context-specific. Factors such as competitive conditions or resource constraints can influence the perception of regulatory costs on performance. Building on these findings, the study addresses the following elements: the conditions under which regulatory cost is perceived as an obstacle by European companies; the connection between regulatory cost and companies’ goals, and how strategic goals are more likely to be affected; whether regulatory costs hinder European market operations or create barriers to the expansion of company activities in Europe; the differences between innovative and non-innovative companies, and the degree to which the effects are seen in different sectors or influenced by size- or country-specific considerations.