Abstract
The evaluation of regional innovation performance through composite innovation indices can serve as a valuable tool for policy-making. While discussion on the best methodology to construct composite innovation indices continues, we are interested in deepening the use of reference levels and the aggregation issue. So far, additive aggregation methods are, largely, the most widespread aggregation rule, thus allowing for full compensability among single indicators. In this paper, we present an integrated assessment methodology to evaluate regional innovation performance using the Multi-Reference Point based Weak and Strong Composite Indicator (MRP-WSCI) approach, which allows defining reference levels and different degrees of compensability. As an example of application to the Regional Innovation Scoreboard, the proposed technique is developed to measure the innovation performance of Spain’s regions taking into account Spanish and European reference levels. The main features of the proposed approach are: (i) absolute or relative reference levels could be previously defined by the decision maker; (ii) by establishing the reference levels, the resulting composite innovation index is an easy-to-interpret measure; and (iii) the non-compensatory strong composite indicator provides an additional layer of information for policy-making (iv) a visualization tool called Light-Diagram is proposed to track the specific strengths and weaknesses of the regions’ innovation performance.
Highlights
Innovation is considered one of the key factors behind regional growth and lies at the centre of a huge number of studies trying to identify the driving forces of innovation [1,2,3,4]
The focus of our study addresses in particular the “big debate” between linear aggregation vs non-linear aggregation when constructing a composite innovation index, since it determines the level of compensability, that is, the possibility that a large improvement with regard to one or more criteria can offset a small worsening with regard to one or more other criteria, or vice versa [43]
Looking at the MRP-WSCI, the same rank is reached for the top regions, (ES21) País Vasco, (ES51) Cataluña, (ES22) Comunidad Foral de Navarra and (ES30)
Summary
Innovation is considered one of the key factors behind regional growth and lies at the centre of a huge number of studies trying to identify the driving forces of innovation [1,2,3,4]. The importance of measuring innovation is widely acknowledged by policy-makers and researchers in order to identify general trends, determine performance targets and set policy priorities. There has been an ongoing debate on how the innovation performance at different levels should be measured, and three main approaches prevail. The second approach proposes the use of extensive sets of indicators in order to cluster the countries or regions [8,9,10]. Starting from the 1990s, some researchers introduced the use of composite innovation indices, arguing that they can provide a more comprehensive way to benchmark innovation performance for the purpose of policy-making
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