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Government support of the European information technology industry

Author: Kende, Michael INSEAD Area: Economics and Political Science Series: Working Paper ; 96/28/EPS Publisher: Fontainebleau : INSEAD, 1996.Language: EnglishDescription: 36 p.Type of document: INSEAD Working Paper Online Access: Click here Abstract: We look first at past and current government policies supporting the European information technology industry, compare the performance of the European industry with those of Japan and the US, and suggest new policies for increasing the competitiveness of the European industry. In the 1960s and 1970s, the policy in Europe consisted of national governments supporting domestic national champion firms. When it became apparent that these policies were unsuccessful, the governments began supporting European-wide cooperative research on basic technology. While US firms have shown continuing competitive strengths in all segments of hardware, European information technology firms have developed few competitive strengths. The greatest weakness of European firms is the inability to market technology; to reach the goal of a competitive European information technology industry, policy should focus on creating an environment in which firms, particularly start-up firms, can commercialize existing and new technology
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We look first at past and current government policies supporting the European information technology industry, compare the performance of the European industry with those of Japan and the US, and suggest new policies for increasing the competitiveness of the European industry. In the 1960s and 1970s, the policy in Europe consisted of national governments supporting domestic national champion firms. When it became apparent that these policies were unsuccessful, the governments began supporting European-wide cooperative research on basic technology. While US firms have shown continuing competitive strengths in all segments of hardware, European information technology firms have developed few competitive strengths. The greatest weakness of European firms is the inability to market technology; to reach the goal of a competitive European information technology industry, policy should focus on creating an environment in which firms, particularly start-up firms, can commercialize existing and new technology

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