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The Importance of Innovation for Productivity

Author

Listed:
  • Someshwar Rao
  • Ashfaq Ahmad
  • William Horsman
  • Phaedra Kaptein-Russell

Abstract

Innovation is widely recognized as a key ingredient of productivity success. This article by Someshwar Rao, Ashfaq Ahmad, William Horsman, and Phaedra Kaptein-Russell of Industry Canada provides support for this view by finding a strong positive relationship between measures of fundamental innovation, labour productivity and GDP per capita across OECD countries. The authors paint a nuanced portrait of Canada's innovation performance. The existence of an innovation gap with the United States is evidenced by our lower R&D/GDP ratio and the lower rate of patenting by Canadians in the United States, although Canada, perhaps surprisingly, has a greater relative number of R&D personal in the total economy than does the United States. But the innovation gap with the United States appears to have narrowed in the 1990s, due to faster growth in this country in the number of patents by Canadians in the United States and in R&D expenditures relative to GDP.

Suggested Citation

  • Someshwar Rao & Ashfaq Ahmad & William Horsman & Phaedra Kaptein-Russell, 2001. "The Importance of Innovation for Productivity," International Productivity Monitor, Centre for the Study of Living Standards, vol. 2, pages 11-18, Spring.
    • Handle: RePEc:sls:ipmsls:v:2:y:2001:2
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    File URL: http://www.csls.ca/ipm/2/rao-e.pdf
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    File URL: http://www.csls.ca/ipm/2/rao-f.pdf
    File Function: version en francais, pp:10-18
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    References listed on IDEAS

    as
    1. Ginarte, Juan C. & Park, Walter G., 1997. "Determinants of patent rights: A cross-national study," Research Policy, Elsevier, vol. 26(3), pages 283-301, October.
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    Cited by:

    1. Someshwar Rao & Jianmin Tang & Weimin Wang, 2003. "Canada's Recent Productivity Record and Capital Accumulation," International Productivity Monitor, Centre for the Study of Living Standards, vol. 7, pages 24-38, Fall.
    2. Navera Khan & Sidra Salam & Asifullah Sherpao, 2014. "Impact of Innovation on Customer Satisfaction and Brand Loyalty: A Case Study of Professionals," International Journal of Management Sciences, Research Academy of Social Sciences, vol. 3(9), pages 663-672.
    3. Othmani, Abdelhafidh & Ben Yedder, Nadia & Bakari, Sayef, 2023. "The Cointegration Relationship between Patent, Domestic Investment and Economic Growth in United States of America," MPRA Paper 118245, University Library of Munich, Germany.
    4. Someshwar Rao & Jianmin Tang & Weimin Wang, 2002. "The Importance of Skills for Innovation and Productivity," International Productivity Monitor, Centre for the Study of Living Standards, vol. 4, pages 15-26, Spring.
    5. Andrew Sharpe, 2003. "Why are Americans More Productive than Canadians?," International Productivity Monitor, Centre for the Study of Living Standards, vol. 6, pages 19-37, Spring.
    6. Mustansar, Talreja, 2023. "Financial innovation, technological improvement and bank’ profitability," OSF Preprints 8wy95, Center for Open Science.
    7. Andrew Sharpe & Olivier Guibaud, 2005. "Indicators of Innovation in Canadian Natural Resource Industries," CSLS Research Reports 2005-03, Centre for the Study of Living Standards.
    8. Iuliana-Tania ZLATCU & Roxana CLODNITCHI, 2018. "The Impact of Competition on Productivity. Theory and Evidence," REVISTA DE MANAGEMENT COMPARAT INTERNATIONAL/REVIEW OF INTERNATIONAL COMPARATIVE MANAGEMENT, Faculty of Management, Academy of Economic Studies, Bucharest, Romania, vol. 19(4), pages 410-421, October.
    9. Andrew Sharpe, 2003. "Why are Americans More Productive than Canadians?," International Productivity Monitor, Centre for the Study of Living Standards, vol. 6, pages 19-37, Spring.
    10. Andrew Sharpe, 2004. "Ten Productivity Puzzles Facing Researchers," International Productivity Monitor, Centre for the Study of Living Standards, vol. 9, pages 15-24, Fall.
    11. Darku, Alexander B. & Malla, Stavroula, 2010. "Agricultural Productivity Growth in Canada: Concepts and Evidences," CAIRN Policy Briefs 273055, Canadian Agricultural Innovation and Regulation Network (CAIRN).

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    More about this item

    Keywords

    Innovation; Productivity; OECD; Innovation Gap; R&D; Patent; Canada; Drivers; Income; Total Factor Productivity; Innovation Policy; Government;
    All these keywords.

    JEL classification:

    • 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
    • O38 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Government Policy
    • O47 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - Empirical Studies of Economic Growth; Aggregate Productivity; Cross-Country Output Convergence
    • O57 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - Comparative Studies of Countries
    • O51 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - U.S.; Canada
    • D24 - Microeconomics - - Production and Organizations - - - Production; Cost; Capital; Capital, Total Factor, and Multifactor Productivity; Capacity
    • E61 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - Policy Objectives; Policy Designs and Consistency; Policy Coordination

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