The Relationship between Technological Innovation and Economic Growth in EU Countries: A System GMM Approach

Purpose: This study aims to investigate the effects of technological innovation and scientific research on economic growth in European Union (EU) countries. It emphasizes the importance of prioritizing these factors for sustainable development and global competitiveness. Methodology: The research, conducted using panel data analysis and the System GMM method, examines the relationship between R&D expenditures and per capita Gross Domestic Product (GDP). Findings: Existing research indicates that innovation and research positively affect economic performance. Technological innovation supports economic expansion by enabling the creation of new products and improving production methods, while scientific research also makes a significant contribution to economic growth. The study confirms a positive relationship between R&D expenditures and GDP per capita, indicating economic growth. Originality: In contrast to existing literature, the results are analyzed comparatively on EU countries using methods such as Prais-Winsten and System GMM. Additionally, the discussion conducted on the group of EU member states addresses the concepts of sustainable development and global competitiveness.