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Determinants of Innovative Activities: Evidence from Europe and Central Asia Region

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  • Lau, Chi Keung Marco
  • Yang, Fu Steve
  • Zhang, Zhe
  • Leung, Vincent K.K.

Abstract

Recent studies in the innovation literature reveal that Foreign Direct Investment (FDI) promotes the innovation activities in the recipent country through spillover effects. In this paper we extend the existing literature by incooprating 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 spillover effect on innovative activity. However, corporate corruption and expenditure on education sector are positively related to the number of patents applications. Our study shed light on the national innovation activities and anti-corruption programs.

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Bibliographic Info

Paper provided by University Library of Munich, Germany in its series MPRA Paper with number 47153.

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Date of creation: 05 Jan 2013
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Handle: RePEc:pra:mprapa:47153

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Keywords: Foreign direct investment; Corruption; Innovation; Technology transfer;

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  1. Beata K. Smarzynska & Shang-Jin Wei, 2000. "Corruption and Composition of Foreign Direct Investment: Firm-Level Evidence," NBER Working Papers 7969, National Bureau of Economic Research, Inc.
  2. Acs, Zoltan J. & Anselin, Luc & Varga, Attila, 2002. "Patents and innovation counts as measures of regional production of new knowledge," Research Policy, Elsevier, Elsevier, vol. 31(7), pages 1069-1085, September.
  3. Varsakelis, Nikos C., 2006. "Education, political institutions and innovative activity: A cross-country empirical investigation," Research Policy, Elsevier, Elsevier, vol. 35(7), pages 1083-1090, September.
  4. 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, Elsevier, vol. 30(7), pages 1059-1068, August.
  5. Jaffe, Adam B., 1989. "Characterizing the "technological position" of firms, with application to quantifying technological opportunity and research spillovers," Research Policy, Elsevier, Elsevier, vol. 18(2), pages 87-97, April.
  6. Furman, Jeffrey L. & Porter, Michael E. & Stern, Scott, 2002. "The determinants of national innovative capacity," Research Policy, Elsevier, Elsevier, vol. 31(6), pages 899-933, August.
  7. Mauro, Paolo, 1995. "Corruption and Growth," The Quarterly Journal of Economics, MIT Press, MIT Press, vol. 110(3), pages 681-712, August.
  8. Grande, Edgar & Peschke, Anke, 1999. "Transnational cooperation and policy networks in European science policy-making," Research Policy, Elsevier, Elsevier, vol. 28(1), pages 43-61, January.
  9. Anokhin, Sergey & Schulze, William S., 2009. "Entrepreneurship, innovation, and corruption," Journal of Business Venturing, Elsevier, vol. 24(5), pages 465-476, September.
  10. Chen, Yunling & Liu, Ming & Su, Jun, 2013. "Greasing the wheels of bank lending: Evidence from private firms in China," Journal of Banking & Finance, Elsevier, Elsevier, vol. 37(7), pages 2533-2545.
  11. 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, Taylor & Francis Journals, vol. 45(17), pages 2325-2335, June.
  12. Wang, Yuanyuan & You, Jing, 2012. "Corruption and firm growth: Evidence from China," China Economic Review, Elsevier, Elsevier, vol. 23(2), pages 415-433.
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