An assessment of IPA public investment in R&I in Albania

This policy brief illustrates the potential effects of public investment in Research and Innovation in Albania under the EU Instrument for Pre-accession Assistance (IPA) using a general equilibrium model of the economy. The results point towards positive effects of the policy on the development of the country which also generate additional spillover benefits to other neighbouring regions.

Abstract

The European Commission's Joint Research Centre (JRC) is supporting an Innovation Agenda for the Western Balkans (Albania, Bosnia and Herzegovina, Kosovo, Montenegro, Republic of North Macedonia and Serbia). Smart Specialisation is the European Union (EU) place-based policy aiming at more thematic concentration in research and innovation (R&I) investments via the evidence-based identification of the strengths and potential of a given economy. Access to data and economic analysis are key to a better identification of both current and future socio-economic policy challenges. The EU Instrument for Pre-accession Assistance (IPA) supports reforms in the enlargement countries with financial and technical help. Out of the almost €650 million destined to Albania over the programming period 2014-2022, €44 are supporting competitiveness and innovation. Policy simulations using CGE modelling techniques show positive macro-economic effects of the IPA funds for competitiveness and innovation both in the short run and in the long run thanks to productivity improvements.