however, a more rapid expansion of the number of graduates in German plants meant
that Northern Ireland and the Republic of Ireland were overtaken by Bavarian plants.
This meant that both in terms of the scale and extent of R&D activity and graduate
employment, plants in Bavaria had the strongest resource base for innovation. There
is evidence, however, that the co-ordination of these resources may be less effective in
Germany with fewer plants operating multi-functional groups as part of their
innovation activity. More uniformity was evident between the study regions in terms
of plants’ external links to other businesses and universities.
For plants in Northern Ireland there does seem to have been something of an
improvement in the environment for innovation during the 1990s. A perception of
fewer innovation constraints has contributed to an increase in the extent of R&D
activity, although this continues to lag well behind that in Germany. Intra-plant and
inter-firm co-ordination during the innovation process in Northern Ireland at least
matches that in Germany. The increase in the extent of R&D activity and the
improvement in the environment for innovation in Northern Ireland are less apparent
in the benchmarks for innovation outputs. The extent of innovation in Northern
Ireland has increased, but has fallen further below that in Bavaria (from 3.0 to 7.5 pp).
Like the Republic of Ireland, however, a perhaps more worrying result is that
innovative products introduced by Northern Ireland plants were proving less
successful than previously. For smaller plants this may reflect a decline in the extent
of innovation in Northern Ireland, for larger plants, however, it suggests that the
innovations being made are more marginal. One possibility, evident in case-study
evaluations of R&D support measures (e.g. Roper, 1998), is that government support
for R&D activity is encouraging innovations which are technically feasible but lack
market applicability.
The situation in the Republic of Ireland reflects that in Northern Ireland, with plants’
difficulties exacerbated by shortages of appropriately skilled labour. As in Northern
Ireland the extent and scale of firms’ R&D activity has increased but remains well
below that in Bavaria. Also like Northern Ireland, multi-functional working in the
innovation process is more common than in Bavaria, with similar levels of inter-firm
linkages. The extent of innovation in the Republic of Ireland is consistently above that
in Northern Ireland, although the gap has narrowed from 8.1 pp in 1993 to 4.4 pp in
20