Financial Management of Innovation Ecosystems in EU Member-States

This paper explores the financial management of innovation ecosystems in European Union member states by introducing a comparative framework based on three financial intensity metrics: research and development expenditure per capita, per employed person, and per research and development personnel. While existing literature emphasizes collaborative governance, funding instruments, and innovation outputs, it often lacks a coherent financial interpretation of innovation indicators. The study addresses this gap by investigating whether translating innovation metrics into financial terms enhances the strategic evaluation and management of national innovation ecosystems. The research builds on previous studies that highlight the growing role of venture capital, public financial institutions, and digital financing tools in fostering innovation. Using longitudinal data from 2015 to 2023, the analysis applies a categorization model aligned with established performance thresholds to classify countries based on their financial investment in innovation. The results reveal significant discrepancies between financial input-based classification and existing scoreboard-based rankings, particularly in the identification of leading and lagging performers. The findings suggest that financial intensity provides a more grounded understanding of national innovation capacities. This approach offers a transparent, replicable tool for benchmarking investment strategies and supports future research focused on aligning funding models with innovation policy and performance outcomes.