Characteristics of innovation systems that lead to greater productivity and economic development
Abstract
The national R&D system is a concept that has gained significant recognition; however, measuring it is challenging and not devoid of difficulties. In this paper the method of composite variables is applied to configure R&D systems and with this examines their characteristics and subsequent impact on fostering greater innovation by studying a group of OECD countries. Starting with many variables, 31 variables were selected for the second step and used in a factor analysis to create composite indicators or unobservable abstract variables. Each variable’s assignment to a single factor is clear, allowing the identification of five distinct and interpretable factors. Subsequently, a knowledge production function was estimated, considering a technological outcome of the R&D systems as the dependent variable; another function was configured reflecting the scientific output. Finally, an additional model was estimated, using productivity as the dependent variable. In all models, the National R&D Effort and Innovative Firms Factor emerged as the most significant variable, underscoring the importance of reaching certain thresholds in terms of available human and physical resources for carrying out innovative efforts within an R&D system.
References
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Filipescu, D. A., Prashantham, S., Rialp, A., & Rialp, J. (2013). Technological innovation and exports: Unpacking their reciprocal causality. Journal of International Marketing, 21(1), 23–38. https://doi.org/10.1509/jim.12.0099
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Hausman, N. (2022). University innovation and local economic growth. Review of Economics and Statistics, 104(4), 718-735. https://doi.org/10.1162/rest_a_01027
Hollenstein, H. (1996). A composite indicator of a firm’s innovativeness. An empirical analysis based on survey data for Swiss manufacturing. Research Policy, 25(4), 633-645. https://doi.org/10.1016/0048-7333(95)00874-8
Jansen, S., Hunter, E. & Currall, S.C. (2016). Managing the innovators: Organizational and professional commitment among scientist and engineers. Research Policy, 45(2016), 1247-1262. https://doi.org/10.1016/j.respol.2016.03.009
Jiménez-Fernández, E., Sánchez, A. & Ortega-Pérez, M. (2022). Dealing with weighting scheme incomposite indicators: An unsupervised distance-machine learning proposal for quantitative data. Socio-Economic Planning Sciences, 83, 1-11. https://doi.org/10.1016/j.seps.2022.101339
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Leogrande, A., Costantiello, A., & Laureti, L. (2021). The impact of venture capital expenditures on innovation in Europe. SSRN Electronic Journal. https://doi.org/10.2139/ssrn.3930697
Lundvall, B. (1992). National Systems of Innovation: Towards a Theory of Innovation and Interactive Learning. (1rst edition). Pinter Publishers. https://www-jstor-org.uchile.idm.oclc.org/stable/j.ctt1gxp7cs
Makkonen, T., & van der Have, R. P. (2013). Benchmarking regional innovative performance: composite measures and direct innovation counts. Scientometrics, 94(1), 247–262. https://doi.org/10.1007/s11192-012-0753-2
Meissner, D., & Shmatko, N. (2019). Integrating professional and academic knowledge: the link between researchers skills and innovation culture. The Journal of Technology Transfer, 44(4), 1273–1289. https://doi.org/10.1007/s10961-018-9662-8
Myers, K. R., & Lanahan, L. (2022). Estimating spillovers from publicly funded R&D: Evidence from the US Department of Energy. American Economic Review, 112(7), 2393–2423. https://doi.org/10.1257/aer.20210678
Nguyen, C. P., Schinckus, C., & Su, T. D. (2020). The drivers of economic complexity: International evidence from financial development and patents. International Economics, 164, 140–150. https://doi.org/10.1016/j.inteco.2020.09.004
OECD (2008). Handbook on Constructing Composite Indicators: Methodology and User Guide. OECD Publications.
Onetti, A., Zucchella, A., Jones, M. V., & McDougall-Covin, P. P. (2012). Internationalization, innovation and entrepreneurship: business models for new technology-based firms. Journal of Management & Governance, 16(3), 337–368. https://doi.org/10.1007/s10997-010-9154-1
Park, M., Leahey, E., & Funk, R. J. (2023). Papers and patents are becoming less disruptive over time. Nature, 613(7942), 138–144. https://doi.org/10.1038/s41586-022-05543-x
Pradhan, R. P., Arvin, M. B., Nair, M., & Bennett, S. E. (2020). The dynamics among entrepreneurship, innovation, and economic growth in the Eurozone countries. Journal of Policy Modeling, 42(5), 1106–1122. https://doi.org/10.1016/j.jpolmod.2020.01.004
Puertas, R., Marti, L., & Guaita-Martinez, J. M. (2020). Innovation, lifestyle, policy and socioeconomic factors: An analysis of European quality of life. Technological Forecasting and Social Change, 160(120209), 120209. https://doi.org/10.1016/j.techfore.2020.120209
Schumpeter, J. A. (1939). Business cycles: theoretical, historical, and statistical analysis of the capitalist process. McGraw-Hill.
Solow, R. M. (1956). A contribution to the theory of economic growth. The Quarterly Journal of Economics, 70(1), 65. https://doi.org/10.2307/1884513
Suárez, D. & Natera, J.M. (2024). Métodos para el análisis de los procesos de ciencia, tecnología e innovación. Herramientas para el estudio del desarrollo de América Latina. Vol.2 Métodos cuantitativos. Ediciones UNGS.
Sun, X., Li, H., & Ghosal, V. (2020). Firm-level human capital and innovation: Evidence from China. China Economic Review, 59(101388), 101388. https://doi.org/10.1016/j.chieco.2019.101388
Yang, C.-H. (2018). Exports and innovation: the role of heterogeneity in exports. Empirical Economics, 55(3), 1065–1087. https://doi.org/10.1007/s00181-017-1312-8
Alqararah, K. (2023). Assessing the robustness of composite indicators: the case of the Global Innovation Index. Journal of Innovation and Entrepreneurship, 12(61). https://doi.org/10.1186/s13731-023-00332-w
Baumert, T. (2006). Los determinantes de la innovación. Un estudio aplicado sobre las regiones de la Unión Europea. [Tesis Doctoral. Universidad Complutense de Madrid. España]. https://produccioncientifica.ucm.es/documentos/5d1df64029995204f7665f77
Biasi, B., Deming, D., & Moser, P. (2022). Education and innovation. In M. J. Andrews, A. Chatterji, J. Lerner, & S. Stern (Eds.), The role of innovation and entrepreneurship in economic growth (pp. 537-551). University of Chicago Press. [invalid URL removed] https://www.nber.org/books-and-chapters/role-innovation-andentrepreneurship-economic-growth/education-and-innovation
Boeing, P., Eberle, J., & Howell, A. (2022). The impact of China’s R&D subsidies on R&D investment, technological upgrading and economic growth. Technological Forecasting and Social Change, 174(121212), 121212. https://doi.org/10.1016/j.techfore.2021.121212
Buesa, M. & Heijs, J. (2016). Manual de economía de innovación. Tomo I. Teoría del cambio tecnológico y sistemas nacionales de innovación. [Instituto de Análisis Industrial y Financiero. Universidad Complutense de Madrid. España].
Buesa, M., Heijs, J., Martínez Pellitero, M., & Baumert, T. (2006). Regional systems of innovation and the knowledge production function: the Spanish case. Technovation, 26(4), 463–472. https://doi.org/10.1016/j.technovation.2004.11.007
Castaneda, D. I., & Cuellar, S. (2020). Knowledge sharing and innovation: A systematic review. Knowledge and Process Management, 27(3), 159–173. https://doi.org/10.1002/kpm.1637
Dai, X., & Chapman, G. (2022). R&D tax incentives and innovation: Examining the role of programme design in China. Technovation, 113(102419), 102419. https://doi.org/10.1016/j.technovation.2021.102419
Fagerberg, J. (1988). International Competitiveness. Economic Journal, 98(391), 355-374. https://econpapers.repec.org/RePEc:ecj:econjl:v:98:y:1988:i:391:p:355-74
Fagerberg, J., & Sapprasert, K. (2018). National innovation systems: the ermergence of a new approach. En Innovation, Economic Development and Policy. Edward Elgar Publishing.
Filipescu, D. A., Prashantham, S., Rialp, A., & Rialp, J. (2013). Technological innovation and exports: Unpacking their reciprocal causality. Journal of International Marketing, 21(1), 23–38. https://doi.org/10.1509/jim.12.0099
Fonseca, T., de Faria, P., & Lima, F. (2019). Human capital and innovation: the importance of the optimal organizational task structure. Research Policy, 48(3), 616–627. https://doi.org/10.1016/j.respol.2018.10.010
Freeman, C. 1995. Innovation and Growth in M. Dodgson & R. Rothwell (Ed.), The Handbook of Industrial Innovation (chapter 7). Edward Elgar Publishing. https://econpapers.repec.org/RePEc:elg:eechap:143_7
Ganga, F., Castillo, J., & Pedraja-Rejas, L. (2016). Factores implicados en la publicación científica: una revisión crítica. Ingeniare. Revista Chilena de Ingeniería, 24(4), 615–627. https://doi.org/10.4067/s0718-33052016000400007
Griliches, Z. (1986). Productivity, R and D, and basic research at the firm level in the 1970’s. American Economic Review, 76(1), 141–154. http://www.jstor.org/stable/1804132
Grupp, H., & Schubert, T. (2010). Review and new evidence on composite innovation indicators for evaluating national performance. Research Policy, 39(1), 67–78. https://doi.org/10.1016/j.respol.2009.10.002
Gutiérrez, C. (2018). Eficiencia de los sistemas regionales de innovación en Europa y análisis econométrico de sus determinantes. [Tesis para optar al grado académico de Doctor. Universidad Complutense de Madrid. España]. https://eprints.ucm.es/49890/1/T40533.pdf
Gutiérrez, C., Roa P., V., & Smith, J. (2021). The Chilean sectoral innovation systems: An approach from the national innovation survey. Journal of Technology Management & Innovation, 16(1), 3–13. https://doi.org/10.4067/s0718-27242021000100003
Hall, B. H. (2024). Patents, innovation, and development. International Review of Applied Economics, 38(1–2), 17–42. https://doi.org/10.1080/02692171.2021.2022295
Hausman, N. (2022). University innovation and local economic growth. Review of Economics and Statistics, 104(4), 718-735. https://doi.org/10.1162/rest_a_01027
Hollenstein, H. (1996). A composite indicator of a firm’s innovativeness. An empirical analysis based on survey data for Swiss manufacturing. Research Policy, 25(4), 633-645. https://doi.org/10.1016/0048-7333(95)00874-8
Jansen, S., Hunter, E. & Currall, S.C. (2016). Managing the innovators: Organizational and professional commitment among scientist and engineers. Research Policy, 45(2016), 1247-1262. https://doi.org/10.1016/j.respol.2016.03.009
Jiménez-Fernández, E., Sánchez, A. & Ortega-Pérez, M. (2022). Dealing with weighting scheme incomposite indicators: An unsupervised distance-machine learning proposal for quantitative data. Socio-Economic Planning Sciences, 83, 1-11. https://doi.org/10.1016/j.seps.2022.101339
Junge, M., Severgnini, B., & Sørensen, A. (2012). Evidence on the Impact of Education on Innovation and Productivity. Department of Economics. Copenhagen Business School. Working Paper / Department of Economics. Copenhagen Business School No. 2-2012 https://research.cbs.dk/en/publications/evidence-on-the-impact-of-education-on-innovation-and-productivit
Leogrande, A., Costantiello, A., & Laureti, L. (2021). The impact of venture capital expenditures on innovation in Europe. SSRN Electronic Journal. https://doi.org/10.2139/ssrn.3930697
Lundvall, B. (1992). National Systems of Innovation: Towards a Theory of Innovation and Interactive Learning. (1rst edition). Pinter Publishers. https://www-jstor-org.uchile.idm.oclc.org/stable/j.ctt1gxp7cs
Makkonen, T., & van der Have, R. P. (2013). Benchmarking regional innovative performance: composite measures and direct innovation counts. Scientometrics, 94(1), 247–262. https://doi.org/10.1007/s11192-012-0753-2
Meissner, D., & Shmatko, N. (2019). Integrating professional and academic knowledge: the link between researchers skills and innovation culture. The Journal of Technology Transfer, 44(4), 1273–1289. https://doi.org/10.1007/s10961-018-9662-8
Myers, K. R., & Lanahan, L. (2022). Estimating spillovers from publicly funded R&D: Evidence from the US Department of Energy. American Economic Review, 112(7), 2393–2423. https://doi.org/10.1257/aer.20210678
Nguyen, C. P., Schinckus, C., & Su, T. D. (2020). The drivers of economic complexity: International evidence from financial development and patents. International Economics, 164, 140–150. https://doi.org/10.1016/j.inteco.2020.09.004
OECD (2008). Handbook on Constructing Composite Indicators: Methodology and User Guide. OECD Publications.
Onetti, A., Zucchella, A., Jones, M. V., & McDougall-Covin, P. P. (2012). Internationalization, innovation and entrepreneurship: business models for new technology-based firms. Journal of Management & Governance, 16(3), 337–368. https://doi.org/10.1007/s10997-010-9154-1
Park, M., Leahey, E., & Funk, R. J. (2023). Papers and patents are becoming less disruptive over time. Nature, 613(7942), 138–144. https://doi.org/10.1038/s41586-022-05543-x
Pradhan, R. P., Arvin, M. B., Nair, M., & Bennett, S. E. (2020). The dynamics among entrepreneurship, innovation, and economic growth in the Eurozone countries. Journal of Policy Modeling, 42(5), 1106–1122. https://doi.org/10.1016/j.jpolmod.2020.01.004
Puertas, R., Marti, L., & Guaita-Martinez, J. M. (2020). Innovation, lifestyle, policy and socioeconomic factors: An analysis of European quality of life. Technological Forecasting and Social Change, 160(120209), 120209. https://doi.org/10.1016/j.techfore.2020.120209
Schumpeter, J. A. (1939). Business cycles: theoretical, historical, and statistical analysis of the capitalist process. McGraw-Hill.
Solow, R. M. (1956). A contribution to the theory of economic growth. The Quarterly Journal of Economics, 70(1), 65. https://doi.org/10.2307/1884513
Suárez, D. & Natera, J.M. (2024). Métodos para el análisis de los procesos de ciencia, tecnología e innovación. Herramientas para el estudio del desarrollo de América Latina. Vol.2 Métodos cuantitativos. Ediciones UNGS.
Sun, X., Li, H., & Ghosal, V. (2020). Firm-level human capital and innovation: Evidence from China. China Economic Review, 59(101388), 101388. https://doi.org/10.1016/j.chieco.2019.101388
Yang, C.-H. (2018). Exports and innovation: the role of heterogeneity in exports. Empirical Economics, 55(3), 1065–1087. https://doi.org/10.1007/s00181-017-1312-8
Published
2024-09-20
How to Cite
Gutiérrez Rojas, C., Smith-Uldall, J., Ganga-Contreras, F., & González, P. (2024). Characteristics of innovation systems that lead to greater productivity and economic development. Revista Venezolana De Gerencia, 29(108), 1776-1798. https://doi.org/10.52080/rvgluz.29.108.19
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TRIMESTRE
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