Abstract
This study analyzes the role of economic indicators in country-level innovation, represented by patents in the technology sector. Innovation indicators include the ratio of patents owned by foreign residents and the number of patent applications in each industry in the technology sector. Economic indicators include GDP, gross national income, labor cost, R&D expenditure, real minimum wage, tax revenue, and education enrollment. The data for OECD countries collected from stats.oecd.org for 2000 to 2010 is analyzed using Cognos. Results show that countries with low GDP rely on foreign collaboration for innovation; education enrollment stimulates innovation; among the sectors, government and higher education have higher R&D expenditures than private and non-profit sectors. A significant contribution of our research lies in the dimension of internationalization and ownership of technology innovation. We suggest viable solutions for countries facing tax revenue losses arising from mobility of patents.
Highlights
Today, the world’s societies face severe economic and social challenges
What are the key economic factors that determine the success of innovation at a country level? This study addresses the question by exploring the association between economic indicators and innovation for OECD countries for the years 2000 to 2010
This study investigates the relationship between economic development and innovation at a country level for the OECD-member countries
Summary
The world’s societies face severe economic and social challenges. The economic downturn of 2008–2009 has led to reduced growth, rising unemployment, and soaring public debt. Countries need to find new and sustainable sources of growth. Innovation—the introduction of a new or significantly improved product, process, or method—holds the key to boosting economic growth and productivity. Innovation has much broader implications than Research & Development and is influenced by a wider range of factors. Innovation can help accelerate economic recovery and put countries on a path to sustainable and greener growth. Innovation allows a country to discover opportunities that exist or are likely to emerge in time, to focus on existing business processes and practices that improve efficiency, to find potential customers, to minimize wastage, and to increase profits
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