Ž . Research Policy 26 1998 933–946 New technology-based firms in the European union: an introduction D.J. Storey a, ) , B.S. Tether b a Centre for Small and Medium Sized Enterprises, Warwick Business School, UniÕersity of Warwick, CoÕentry, CV4 7AL, UK b ( ) ESRC Centre for Research on InnoÕation and Competition CRIC , UniÕersity of Manchester and UMIST, Precinct Centre, Oxford Road, Manchester, M13 9QH, UK Abstract This paper introduces the Special Issue on New Technology-Based Firms in Europe. It provides an overview of the issues. The role of smaller firms in the development of Europe’s high technology sectors is summarized, as are the policy issues, but the paper mainly discusses the characteristics of European NTBFs and their founders. This includes a review of the evidence with regard to the survival, growth and geographical clustering of NTBFs in Europe, as well as the factors facilitating and inhibiting their creation and development. q 1998 Elsevier Science B.V. Keywords: New technology-based firms; Europe; Overview; Survival; Growth; Entrepreneurship 1. Introduction Twenty years ago the Arthur D. Little Consulting Ž . Group Little, 1977 produced its path-breaking re- port comparing New Technology-Based Firms Ž . NTBFs in the United States with those in the United Kingdom and West Germany. Since then, European interest in NTBFs has remained high, for a number of reasons. In the United States there are numerous examples of NTBFs which have exhibited spectacular rates of growth in employment, sales, exports and assets; more generally NTBFs are thought to embody the technologies of the future which will provide secure employment opportunities for several ) Corresponding author. Tel.: q44-1203-523-692; e-mail: smeds@wbs.warwick.ac.uk. generations. The quality of jobs provided in NTBFs are also thought to be significantly better than those in traditional activities, and, in the US, the geograph- ical areas in which NTBFs are important have also exhibited major indirect employment creation in the business and consumer service sectors. There is also the role of NTBFs in industrial networks, in which they are thought to play an important part in the transfer of technologies and in strengthening the industrial fabric. In 1994, the European Commission reflected this interest by commissioning a study to review the economic importance of New Technology-Based Ž . Firms in Europe Storey and Tether, 1996 . It is that study which forms the basis of the papers presented in this special issue of Research Policy. The purpose of this paper is to provide an introduction to the special issue. It begins by discussing the definition of 0048-7333r98r$19.00 q 1998 Elsevier Science B.V. All rights reserved. Ž . PII S0048-7333 97 00052-8