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National innovation rates: the evidence for/against domestic institutions

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  • Taylor, Mark Zachary

Abstract

Why are some countries more technologically innovative than others? The dominant explanation amongst political-economists is that domestic institutions determine national innovation rates. However, after decades of research, there is still no agreement on precisely how this happens, exactly which institutions matter, and little aggregate evidence has been produced to support any particular hypothesis. This paper will review the equivocating evidence for domestic institutions explanations of national innovation rates. Its survey will show that, although a specific domestic institution or policy might appear to explain a particular instance of innovation, they generally fail to explain national innovation rates across time and space. Instead, the empirical evidence suggests that certain kinds of international relationships (e.g. capital goods imports, foreign direct investment, educational exchanges) affect national innovation rates in the aggregate, and that these relationships are not themselves determined by domestic institutions. In other words, explaining national innovation rates may not be so much a domestic institutions story as it is an international story.

Suggested Citation

  • Taylor, Mark Zachary, 2007. "National innovation rates: the evidence for/against domestic institutions," MPRA Paper 10997, University Library of Munich, Germany.
    • Handle: RePEc:pra:mprapa:10997
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    References listed on IDEAS

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    More about this item

    Keywords

    technology; technological; innovation; politics; institutions; research;
    All these keywords.

    JEL classification:

    • P5 - Political Economy and Comparative Economic Systems - - Comparative Economic Systems
    • O3 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights
    • O14 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Industrialization; Manufacturing and Service Industries; Choice of Technology

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