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Is Innovation in Pakistan Driven by Specialisation or Diversity?

Author

Listed:
  • Adeel Ali

    (Project Economist/Research Assistant, Applied Economics Research Centre, University of Karachi, Karachi)

  • Faizan Iftikhar

    (Assistant Professor, Applied Economics Research Centre, University of Karachi, Karachi)

  • Muhammad Sabihuddin Butt

    (Associate Professor, Applied Economics Research Centre, University of Karachi, Karachi)

Abstract

Innovation is among the main drivers of industrial development leading to economic growth. However, the question triggers that what drives innovation? Is innovation driven by specialisation or diversification? The literature has supported both, the specialisation and diversification as driver of innovation. Therefore, the purpose of this paper is to explore the determinants of innovation in Pakistan with a special emphasis on specialisation and diversity. The analysis is based on the cross sectional data set of 784 firms across 13 different cities of Pakistan, i.e. Investment Climate Survey (ICS) 2007, compiled by the World Bank Enterprise Group. Our findings have showed the positive relation between innovation and diversity i.e. diversity is conducive to innovation. On the other hand, specialisation has a negative effect i.e. it hinders innovation in cities of Pakistan.

Suggested Citation

  • Adeel Ali & Faizan Iftikhar & Muhammad Sabihuddin Butt, 2016. "Is Innovation in Pakistan Driven by Specialisation or Diversity?," The Pakistan Development Review, Pakistan Institute of Development Economics, vol. 55(4), pages 705-714.
    • Handle: RePEc:pid:journl:v:55:y:2016:i:4:p:705-714
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    References listed on IDEAS

    as
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    More about this item

    Keywords

    Innovation; Specialisation; Diversity; Logistic Regression;
    All these keywords.

    JEL classification:

    • C21 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Cross-Sectional Models; Spatial Models; Treatment Effect Models
    • C25 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Discrete Regression and Qualitative Choice Models; Discrete Regressors; Proportions; Probabilities
    • O31 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Innovation and Invention: Processes and Incentives
    • O32 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Management of Technological Innovation and R&D

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