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The impact of governance and infrastructure on innovation

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  • Rudolf Sivak
  • Anetta Caplanova
  • John Hudson

Abstract

This article uses a recent wave of the World Bank Enterprise Survey to analyse four aspects of innovation: (i) the introduction of a new product or service, (ii) product/service upgrading, (iii) R&D and (iv) the licensing of technology. Good governance affects innovation on several dimensions. Bureaucracy, in the form of permits posing a problem for firms, can deter firms from innovating themselves, moving them towards the licensing of foreign technology, and corruption deters R&D. However, there is evidence of a negative impact of good and effective courts on innovation and R&D. Although perhaps slightly surprising, this is not inconsistent with much of the literature. In addition regional infrastructure, which is to varying degrees also determined by government policy, is significant in determining innovation. This includes transport, IT and financial infrastructure.

Suggested Citation

  • Rudolf Sivak & Anetta Caplanova & John Hudson, 2011. "The impact of governance and infrastructure on innovation," Post-Communist Economies, Taylor & Francis Journals, vol. 23(2), pages 203-217.
  • Handle: RePEc:taf:pocoec:v:23:y:2011:i:2:p:203-217
    DOI: 10.1080/14631377.2011.570050
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    References listed on IDEAS

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    1. Philippe Aghion & Reinhilde Veugelers & Clément Serre, 2009. "Cold Start for the Green Innovation Machine," Policy Contributions 354, Bruegel.
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    Cited by:

    1. Andrés Rodríguez-Pose & Marco Di Cataldo, 2015. "Quality of government and innovative performance in the regions of Europe," Journal of Economic Geography, Oxford University Press, vol. 15(4), pages 673-706.
    2. Anetta Čaplánová & Rudolf Sivák & John Hudson, 2012. "Vplyv priamych zahraničných investícií na inovačnú činnosť firiem
      [The Impact of Foreign Direct Investment on Firms´ Innovation Activities]
      ," Politická ekonomie, University of Economics, Prague, vol. 2012(6), pages 764-779.

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