Authors: Marco Gentile, Alessio Bumbea, Debora Giannini, Annamaria Giuffrida, Lucrezia Macigno, Davide Mariz, Andrea Mazzitelli, Marco Pini, Paolo Righi, Alessandro Rinaldi, Francesco Salate Santone

This study aims to provide a novel perspective on Europe's innovation landscape by offering an original, data-driven analysis of EU Strategic Technologies (EUST), assessing firm-level innovation in the EU compared to the United States and China, as well as other world regions. The purpose of the research is threefold: i) to investigate firms’ innovation in EU strategic technologies (EUST) by mapping patents linked to EUST and to isolate the subgroup related to Net-Zero technologies (EUST NZ) through Large Language Models (LLMs) and scraping firms’ websites; ii) to estimate the effect of strategic technologies on labour productivity at the firm level; iii) to explore technological interdependencies between strategic technologies.

The findings reveal heterogeneity in firms’ innovation propensity across EU member states. At a global level, while the EU has a broad base of innovative firms, it lags in patent volume and intensity compared to its competitors. The study demonstrates the positive impact of strategic technology patents on firm-level labor productivity, particularly for Net-Zero technologies, reinforcing their strategic importance.

Additionally, the study identifies key interconnected technologies—such as Cloud Computing, AI, Cybersecurity, and Hydrogen Technologies—which act as innovation hubs, crucial for advancing EU industrial policy. These findings directly support EU policies, particularly STEP and NZIA, providing empirical evidence for optimizing investments, closing the innovation gap, and securing Europe’s technological sovereignty. This research helps ensure that EU investments translate into economic growth and global competitiveness.

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