Determinants Of Innovative Capability Of A Country And Its Role In Economic Growth

Abstract

This paper discusses the role that innovation plays in global competition and provides examples showing how firms from selected emerging markets use innovation to compete with global firms from the developed world. This paper also discusses the role of innovative capability in growth of a country by suggesting that in the long-term, a nation’s higher order competitive advantage can only be built with the innovative capability of its firms. In this context, an empirical model was used to identify the determinants of innovative capability of a country. The discussion of these determinants should be useful to policymakers in countries attempting to promote economic growth by improving the productivity of firms in their respective countries.