Indicators of Absorptive Capacity : A Policy-Led, Dimensional Approach. Theoretical Framework and Estimates for 24 Countries and 24 UK Sectors

The paper aims to operationalize the concept of absorptive capacity (ACAP) into empirical indicators useful for the development of innovation policy at the level of countries and sectors. Applications are presented for 24 European countries and 24 UK sectors. The work centres around the development of policy-led dimensions of ACAP, specifically: knowledge intensity; human resources; physical and digital connectivity; and diversity. Several variables contribute to each of these dimensions and ACAP values. Validation of the operationalization system is attempted via correlations with labour productivity. Official statistical data are used for the country study. Data from the Community Innovation Survey are used for the sector study. The results show clear strengths and weaknesses in ACAP by country. Moreover, countries tend to have strengths or weaknesses in all or most of the dimensions. The results for sectors appear to be more industry than size specific