IDEAS home Printed from https://ideas.repec.org/a/wsi/serxxx/v60y2015i01ns0217590815500046.html
   My bibliography  Save this article

Determinants Of Innovative Activities: Evidence From Europe And Central Asia Region

Author

Listed:
  • CHI KEUNG MARCO LAU

    (Newcastle Business School, Northumbria University, Newcastle, UK)

  • FU STEVE YANG

    (School of Management, Centennial College, 3 Wah Lam Path, Pokfulam, Hong Kong)

  • ZHE ZHANG

    (Department of Management, Marketing and International Business, School of Business, Eastern Kentucky University, Kentucky, USA)

  • VINCENT K. K. LEUNG

    (Department of Marketing, School of Business, Hong Kong Baptist University, Hong Kong)

Abstract

Recent studies in the innovation literature show that Foreign Direct Investment (FDI) enhances innovations in recipient countries through spill-over effects. In this paper we extend the existing literature by incorporating the corruption index in the estimation procedure. Using a cross-country analysis from the Europe and Central Asia (ECA) region, covering 57 countries over the period of 1995–2010, we find no evidence of FDI spill-over effects on innovations, when corruption is endogenously modelled in the regression. Interestingly, we find that corruption and expenditure on education sector are positively related to the number of patents applications, suggesting anti-corruption programs encourage innovations that promote economic growth. Our study shed light on the national innovations and anti-corruption programs.

Suggested Citation

  • Chi Keung Marco Lau & Fu Steve Yang & Zhe Zhang & Vincent K. K. Leung, 2015. "Determinants Of Innovative Activities: Evidence From Europe And Central Asia Region," The Singapore Economic Review (SER), World Scientific Publishing Co. Pte. Ltd., vol. 60(01), pages 1-18.
    • Handle: RePEc:wsi:serxxx:v:60:y:2015:i:01:n:s0217590815500046
    DOI: 10.1142/S0217590815500046
    as

    Download full text from publisher

    File URL: http://www.worldscientific.com/doi/abs/10.1142/S0217590815500046
    Download Restriction: Access to full text is restricted to subscribers
    File URL: https://libkey.io/10.1142/S0217590815500046?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to look for a different version below or search for a different version of it.

    Other versions of this item:

    References listed on IDEAS

    as
    1. Anokhin, Sergey & Schulze, William S., 2009. "Entrepreneurship, innovation, and corruption," Journal of Business Venturing, Elsevier, vol. 24(5), pages 465-476, September.
    2. Unknown, 2009. "Minnesota Applied Economist 722, Review of 2008-2009," Minnesota Applied Economist\Minnesota Agricultural Economist 53840, University of Minnesota, Department of Applied Economics.
    3. Jaffe, Adam B., 1989. "Characterizing the "technological position" of firms, with application to quantifying technological opportunity and research spillovers," Research Policy, Elsevier, vol. 18(2), pages 87-97, April.
    4. Smarzynska, Beata K. & Shang-Jin Wei, 2000. "Corruption and the composition of foreign direct investment - firm-level evidence," Policy Research Working Paper Series 2360, The World Bank.
    5. Grande, Edgar & Peschke, Anke, 1999. "Transnational cooperation and policy networks in European science policy-making," Research Policy, Elsevier, vol. 28(1), pages 43-61, January.
    6. Yan Leung Cheung & P. Raghavendra Rau & Aris Stouraitis, 2012. "How much do firms pay as bribes and what benefits do they get? Evidence from corruption cases worldwide," NBER Working Papers 17981, National Bureau of Economic Research, Inc.
    7. Osamu Onodera, 2008. "Trade and Innovation Project: A Synthesis Paper," OECD Trade Policy Papers 72, OECD Publishing.
    8. Wang, Yuanyuan & You, Jing, 2012. "Corruption and firm growth: Evidence from China," China Economic Review, Elsevier, vol. 23(2), pages 415-433.
    9. Chen, Yunling & Liu, Ming & Su, Jun, 2013. "Greasing the wheels of bank lending: Evidence from private firms in China," Journal of Banking & Finance, Elsevier, vol. 37(7), pages 2533-2545.
    10. Laura de Dominicis & Raymond J.G.M. Florax & Henri L.F. de Groot, 2013. "Regional clusters of innovative activity in Europe: are social capital and geographical proximity key determinants?," Applied Economics, Taylor & Francis Journals, vol. 45(17), pages 2325-2335, June.
    11. Zoltan J. Acs & Luc Anselin & Attila Varga, 2008. "Patents and Innovation Counts as Measures of Regional Production of New Knowledge," Chapters, in: Entrepreneurship, Growth and Public Policy, chapter 11, pages 135-151, Edward Elgar Publishing.
    12. David Roodman, 2006. "How to Do xtabond2," North American Stata Users' Group Meetings 2006 8, Stata Users Group.
    13. Gene M. Grossman & Elhanan Helpman, 1993. "Innovation and Growth in the Global Economy," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262570971, December.
    14. Varsakelis, Nikos C., 2006. "Education, political institutions and innovative activity: A cross-country empirical investigation," Research Policy, Elsevier, vol. 35(7), pages 1083-1090, September.
    15. Furman, Jeffrey L. & Porter, Michael E. & Stern, Scott, 2002. "The determinants of national innovative capacity," Research Policy, Elsevier, vol. 31(6), pages 899-933, August.
    16. Varsakelis, Nikos C., 2001. "The impact of patent protection, economy openness and national culture on R&D investment: a cross-country empirical investigation," Research Policy, Elsevier, vol. 30(7), pages 1059-1068, August.
    17. Paolo Mauro, 1995. "Corruption and Growth," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 110(3), pages 681-712.
    18. Prashanth Mahagaonkar, 2008. "Corruption and Innovation: A Grease or Sand relationship?," Jena Economics Research Papers 2008-017, Friedrich-Schiller-University Jena.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Wang, Quan-Jing & Feng, Gen-Fu & Chen, Yin E. & Wen, Jun & Chang, Chun-Ping, 2019. "The impacts of government ideology on innovation: What are the main implications?," Research Policy, Elsevier, vol. 48(5), pages 1232-1247.
    2. Qizhen Wang & Suxia Liu, 2022. "How Do FDI and Technological Innovation Affect Carbon Emission Efficiency in China?," Energies, MDPI, vol. 15(23), pages 1-16, December.
    3. Yu, Zhichao & Youn, Ik Joong & Alessa, Noha & Borgi, Hela, 2023. "Does natural-resource-dependency create the need of green innovation?," Resources Policy, Elsevier, vol. 85(PA).
    4. Hanen Sdiri & Mohamed Ayadi, 2022. "Does Innovation Foster or Mitigate the Corruption Obstacle? Firm-Level Evidence from Tunisia," Journal of the Knowledge Economy, Springer;Portland International Center for Management of Engineering and Technology (PICMET), vol. 13(1), pages 367-386, March.
    5. Reza Tajaddini & Hassan F. Gholipour, 2018. "Control of Corruption and Luxury Goods Consumption," Kyklos, Wiley Blackwell, vol. 71(4), pages 613-641, November.
    6. Chen, Yin-E & Li, Chunyan & Chang, Chun-Ping & Zheng, Mingbo, 2021. "Identifying the influence of natural disasters on technological innovation," Economic Analysis and Policy, Elsevier, vol. 70(C), pages 22-36.
    7. Dokas, Ioannis & Panagiotidis, Minas & Papadamou, Stephanos & Spyromitros, Eleftherios, 2023. "Does innovation affect the impact of corruption on economic growth? International evidence," Economic Analysis and Policy, Elsevier, vol. 77(C), pages 1030-1054.
    8. Cooray, Arusha & Dzhumashev, Ratbek & Schneider, Friedrich, 2017. "How Does Corruption Affect Public Debt? An Empirical Analysis," World Development, Elsevier, vol. 90(C), pages 115-127.
    9. Swati Mehta, 2018. "National Innovation System of India: An Empirical Analysis," Millennial Asia, , vol. 9(2), pages 203-224, August.
    10. shah, Muhammad ibrahim, 2019. "Fostering innovation in South Asia: Evidence from FMOLS and Causality analysis," MPRA Paper 96193, University Library of Munich, Germany.
    11. Boying Li & Yu Hao & Chun-Ping Chang, 2018. "Does an anticorruption campaign deteriorate environmental quality? Evidence from China," Energy & Environment, , vol. 29(1), pages 67-94, February.
    12. Feng, Suling & Sui, Bo & Liu, Huimin & Li, Guoxiang, 2020. "Environmental decentralization and innovation in China," Economic Modelling, Elsevier, vol. 93(C), pages 660-674.
    13. Halkos, George E. & Papageorgiou, George J. & Halkos, Emmanuel G. & Papageorgiou, John G., 2020. "Public debt games with corruption and tax evasion," Economic Analysis and Policy, Elsevier, vol. 66(C), pages 250-261.
    14. Apergis, Nicholas & Katsaiti, Marina-Selini, 2018. "Poverty and the resource curse: Evidence from a global panel of countries," Research in Economics, Elsevier, vol. 72(2), pages 211-223.
    15. Nedra Baklouti & Younes Boujelbene, 2020. "A simultaneous equation model of economic growth and shadow economy: Is there a difference between the developed and developing countries?," Economic Change and Restructuring, Springer, vol. 53(1), pages 151-170, February.
    16. Wang, Quan-Jing & Feng, Gen-Fu & Wang, Hai-Jie & Chang, Chun-Ping, 2021. "The impacts of democracy on innovation: Revisited evidence," Technovation, Elsevier, vol. 108(C).
    17. Feng, Gen-Fu & Zheng, Mingbo & Wen, Jun & Chang, Chun-Ping & Chen, Yin E., 2019. "The assessment of globalization on innovation in Chinese manufacturing firms," Structural Change and Economic Dynamics, Elsevier, vol. 50(C), pages 190-202.
    18. Qizhen Wang & Qian Zhang, 2022. "Foreign Direct Investment and Carbon Emission Efficiency: The Role of Direct and Indirect Channels," Sustainability, MDPI, vol. 14(20), pages 1-23, October.
    19. Wen, Jun & Wang, Siqin & Yang, Xiuyun & Zhou, Xiaozhou, 2023. "Impacts of epidemics on innovation: An empirical analysis," Technovation, Elsevier, vol. 119(C).

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Varsakelis, Nikos C., 2006. "Education, political institutions and innovative activity: A cross-country empirical investigation," Research Policy, Elsevier, vol. 35(7), pages 1083-1090, September.
    2. Wang, Quan-Jing & Feng, Gen-Fu & Wang, Hai-Jie & Chang, Chun-Ping, 2021. "The impacts of democracy on innovation: Revisited evidence," Technovation, Elsevier, vol. 108(C).
    3. Wang, Quan-Jing & Feng, Gen-Fu & Chen, Yin E. & Wen, Jun & Chang, Chun-Ping, 2019. "The impacts of government ideology on innovation: What are the main implications?," Research Policy, Elsevier, vol. 48(5), pages 1232-1247.
    4. Priya, Pragati & Sharma, Chandan, 2023. "Reinforcing the effects of corruption and financial constraints on firm performance: Normal versus crisis period in developing economies," Economic Modelling, Elsevier, vol. 127(C).
    5. Cristiana Tudor & Robert Sova, 2022. "Driving Factors for R&D Intensity: Evidence from Global and Income-Level Panels," Sustainability, MDPI, vol. 14(3), pages 1-16, February.
    6. Lain-Tze Tee & Soo-Wah Low & Si-Roei Kew & Noor A. Ghazali, 2014. "Financial Development and Innovation Activity: Evidence from Selected East Asian Countries," Prague Economic Papers, Prague University of Economics and Business, vol. 2014(2), pages 162-180.
    7. Roberto Iorio & Maria Luigia Segnana, 2022. "Is paying bribes worthwhile? Corruption and innovation in middle-income countries," Eurasian Business Review, Springer;Eurasia Business and Economics Society, vol. 12(3), pages 475-504, September.
    8. Dincer, Oguzhan, 2019. "Does corruption slow down innovation? Evidence from a cointegrated panel of U.S. states," European Journal of Political Economy, Elsevier, vol. 56(C), pages 1-10.
    9. Han, Linsong & Li, Xun & Xu, Gang, 2022. "Anti-corruption and poverty alleviation: Evidence from China," Journal of Economic Behavior & Organization, Elsevier, vol. 203(C), pages 150-172.
    10. Micheline Goedhuys & Pierre Mohnen & Tamer Taha, 2016. "Corruption, innovation and firm growth: firm-level evidence from Egypt and Tunisia," Eurasian Business Review, Springer;Eurasia Business and Economics Society, vol. 6(3), pages 299-322, December.
    11. Ruohan Wu, 2019. "Firm Development and Bribery: An Empirical Study from Latin America," Atlantic Economic Journal, Springer;International Atlantic Economic Society, vol. 47(1), pages 53-64, March.
    12. Krammer, Sorin M.S., 2009. "Drivers of national innovation in transition: Evidence from a panel of Eastern European countries," Research Policy, Elsevier, vol. 38(5), pages 845-860, June.
    13. Yogeeswari Subramaniam & Nanthakumar Loganathan, 2022. "Uncertainty and technological innovation: evidence from developed and developing countries," Economic Change and Restructuring, Springer, vol. 55(4), pages 2527-2545, November.
    14. Alam, Ashraful & Uddin, Moshfique & Yazdifar, Hassan, 2019. "Institutional determinants of R&D investment: Evidence from emerging markets," Technological Forecasting and Social Change, Elsevier, vol. 138(C), pages 34-44.
    15. Chaminda Wijesinghe & Henrik Hansson & Love Ekenberg, 2021. "Determinants of ICT Innovations: Lessons Learned from Sweden and Sri Lanka," Administrative Sciences, MDPI, vol. 11(4), pages 1-13, November.
    16. Pragati Priya & Chandan Sharma, 2023. "Do financial constraints and corruption limit firms' innovation capability? Evidence from developing economies," Managerial and Decision Economics, John Wiley & Sons, Ltd., vol. 44(4), pages 1935-1961, June.
    17. Alexandre Almeida & Aurora A.C. Teixeira, 2007. "Does Patenting negatively impact on R&D investment?An international panel data assessment," FEP Working Papers 255, Universidade do Porto, Faculdade de Economia do Porto.
    18. Sharma, Abhijit & Sousa, Cristina & Woodward, Richard, 2022. "Determinants of innovation outcomes: The role of institutional quality," Technovation, Elsevier, vol. 118(C).
    19. Luigi Aldieri & Cristian Barra & Nazzareno Ruggiero & Concetto Paolo Vinci, 2023. "Corruption and firms’ efficiency: international evidence using an instrumental variable approach," Economia Politica: Journal of Analytical and Institutional Economics, Springer;Fondazione Edison, vol. 40(2), pages 731-759, July.
    20. Pezeshkan, Amir & Smith, Adam & Fainshmidt, Stav & Amini Sedeh, Amirmahmood, 2016. "National business systems and firm innovation: A study of developing economies," Journal of Business Research, Elsevier, vol. 69(11), pages 5413-5418.

    More about this item

    Keywords

    Foreign direct investment; corruption; innovation; technology transfer; O32; O34; O38; F21; D73;
    All these keywords.

    JEL classification:

    • D73 - Microeconomics - - Analysis of Collective Decision-Making - - - Bureaucracy; Administrative Processes in Public Organizations; Corruption
    • F21 - International Economics - - International Factor Movements and International Business - - - International Investment; Long-Term Capital Movements
    • O32 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Management of Technological Innovation and R&D
    • O34 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Intellectual Property and Intellectual Capital
    • O38 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Government Policy

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:wsi:serxxx:v:60:y:2015:i:01:n:s0217590815500046. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Tai Tone Lim (email available below). General contact details of provider: http://www.worldscinet.com/ser/ser.shtml .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.