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Technical Efficiency of the Generation of Knowledge in the European Union (2003-2010)

Abstract This paper analyses the determinants of knowledge in the European Union of the 27, through estimates of transcendental logarithmic production functions (translog) in different scenarios. For this, a data panel for the period 2003-2010 has been elaborated, selecting the production stochastic frontier as the most reliable model to estimate technical efficiency for European innovation. The empirical result is that technological capital, human capital and relational capital have a positive and significant influence on the generation of knowledge. Also, from the observation of results we can assure that the size (in terms of population) of a country within the EU-27 does not positively influence the technical efficiency of knowledge production. This is an empirical study about the relationship between the determinants of knowledge and the technical efficiency of the generation of knowledge, and such a study does not exist in literature for the EU-27 in the period analysed.