In search of key determinants of innovativeness in the regions of the Visegrad group countries
Keywords:determinants of innovativeness, R&D expenditure, patent applications, trademark applications, NUTS-2 regions of the Visegrad Group countries
Research background: Discussions on the state of the economy in times of crisis focus not only on maintaining or improving innovativeness, but also on the emergence of new dimensions of this phenomenon and changing the significance of individual determinants of innovativeness. Innovativeness is a complex, multidimensional and difficult to measure phenomenon, which implies the need to select various indicators and methods for its assessment. Synthetic measures of innovativeness are widely used in comparative analyses, in particular presenting results in international or interregional cross-sections. The degree of innovativeness should also be assessed at different levels of economic aggregation. The lower the level of aggregation, the easier it becomes to capture the specific determinants of the increase in innovativeness of a given area.
Purpose of the article: The main aim of the paper is to attempt to measure the relationship between expenditures and results of innovative activities for NUTS-2 regions of the Visegrad Group countries. Three variables were adopted to describe the effects of innovative activity: PCT patent applications per billion GDP (in PPS), trademark applications per billion GDP (in PPS) and public-private co-publications per million of population.
Methods: The study covered 37 NUTS-2 regions of the Visegrad Group countries in the years 2014?2021. From the point of view of the purpose of the paper and the need to search for the relationship between expenditures on innovative activity and the results of this activity, it is worth emphasizing that the use of static and dynamic econometric models proved to be a substantively correct solution leading to the formulation of clear conclusions.
Findings & value added: The conducted research confirmed that business R&D expenditure on GDP has a positive effect on inventions expressed by patents and trademarks, especially in the long run. In addition, the literature review and empirical analyses indicate that the main determinants of innovativeness (both before and during the pandemic) are the expenditures of economic entities on R&D, competences expressed by the level of education or participation in tertiary education, as well as the number of ICT specialists and the percentage of people employed in science and technology. Despite the deterioration of many macroeconomic indicators in the countries of the Visegrad Group, the expenditures of the business sector on R&D in most regions did not decrease between 2019 and 2021. The added value of the paper is the presented research procedure, which can be used in analyses of innovativeness also for other groups of regions.
Akça, S., & Afşar B. (2020). The relationship between economic growth and in-novation: panel data analysis on chosen OECD countries. In H. Dinçer & S. Yüksel (Eds). Handbook of research on decision-making techniques in finan-cial marketing (pp. 358?382). Hershey PA, USA: IGI Global.
Alpaslan, B., & Ali, A. (2017). The spillover effects of innovative ideas on human capital. Review of Development Economics, 22(1), 333?360. doi: 10.1111/rode. 12344.
Anderson, T. W., & Hsiao, C. (1982). Formulation and estimation of dynamic models using panel data. Journal of Econometrics, 18, 47?82. doi: 10.1016/030 4-4076(82)90095-1.
Arellano, M., & Bond, S. (1991). Some tests of specification for panel data: Mon-te Carlo evidence and an application to employment equations. Review of Economic Studies, 58(2), 277?297. doi: 10.2307/2297968.
Athreye, S., & Wunsch-Vincent, S. (2021). The evolving role of public R&D and public research organizations in innovation. In A. Arundel, S. Athreye & S. Wunsch-Vincent (Eds.). Harnessing public research for innovation in the 21st century: an international assessment of knowledge transfer policies (pp. 3?24). Cambridge: Cambridge University Press. doi:10.1017/9781108904230.005.
Aytekin, A, Ecer, F., Korucuk, S., & Karamaşa, C. (2022). Global innovation efficiency assessment of EU member and candidate countries via DEA-EATWIOS multi-criteria methodology. Technology in Society, 68(1), 101896. doi: 10.101 6/j.techsoc.2022.101896.
Baltagi, B. H. (2021). Econometric analysis of panel data. Springer Cham. doi: 10.1007/978-3-030-53953-5.
Banaszyk, P., Deszczyński, P., Gorynia, M., & Malaga, K. (2021). The Covid-19 pandemic as a potential change agent for selected economic concepts. Entrepreneurial Business and Economics Review, 9(4), 35?50. doi: 10.15678/ EBER.2021.090403.
Bello, M., Caperna, G., Damioli, G., & Mathevet, I. (2022). The innovation output indicator. Luxembourg: Publications Office of the European Union. doi: 10.2760/802325.
Bhattacharya, A. (2016). Reinterpreting innovation and innovation measurement ? a theoretical framework for innovation in organisations. Journal of Organisation & Human Behaviour, 5(4), 47?55.
Bigos, K., & Michalik, A. (2020). The influence of innovation on international new ventures? exporting in Central and Eastern Europe and Central Asia coun-tries. Entrepreneurial Business and Economics Review, 8(3), 47?63. doi: 10.15678 /EBER.2020.080303.
Block, J., Fisch, C., Ikeuchi, K., & Kato, M. (2022). Trademarks as an indicator of regional innovation: evidence from Japanese prefectures. Regional Studies, 56(2), 190?209. doi:10.1080/00343404.2021.1887843.
Blundell, R., & Bond, S. (1998). Initial conditions and moment restrictions in dynamic panel data models. Journal of Econometrics, 87(1), 115?143. doi: 10.101 6/S0304-4076(98)00009-8.
Boschma, R. A. (2005). Proximity and innovation: a critical assessment. Regional Studies, 39(1), 61?74. doi: 10.1080/0034340052000320887.
Burhan, M., Singh, A. K., & Jain, S. K. (2017). Patents as proxy for measuring innovations: a case of changing patent filing behavior in Indian public funded research organizations. Technological Forecasting and Social Change, 123(C), 181?190. doi: 10.1016/j.techfore.2016.04.002.
Castellacci, F. (2008). Innovation and the competitiveness of industries: compar-ing the mainstream and the evolutionary approaches. Technological Forecast-ing & Social Change, 75, 984?1006. doi: 10.1016/j.techfore.2007.09.002.
Chamberlain, G. (1978). Omitted variable bias in panel data: estimating the re-turns to schooling. Annales de l'inséé, 30/31, 49?82. doi:10.2307/20075285.
Chen, J., Viardot, E., & Brem, A. (2020). Innovation and innovation management. In J. Chen, A. Brem, E. Viardot, P. K. Wang (Eds.). The Routledge companion to innovation management (pp. 3?16). London and New York: Routledge Tay-lor & Francis Group. doi: 10.4324/9781315276670-1.
Cichy, J., & Gradon, W. (2016). Innovative economy, and the activity of financial market institutions: case of Poland. Journal of International Studies, 9(1), 156?166. doi: 10.14254/2071-8330.2016/9-1/11.
Ciołek, D., & Golejewska, A. (2022). Efficiency determinants of regional innova-tion systems in Polish subregions. Gospodarka Narodowa. The Polish Journal of Economics, 311(3), 24?45. doi: 10.33119/GN/151792.
Czupich, M. (2018). The innovative potential of the Visegrad group regions. University Economic Bulletin, 38, 14?22. doi: 10.31470/2306-546X-2018-38-14-22.
de Carvalho, G. D. G., Cruz, J. A. W., de Carvalho, H. G., Duclós, L. C., & de Fátima Stankowitz. R. (2017). Innovativeness measures: a bibliometric review and a classification proposal. International Journal of Innovation Science, 9(1), 81?101. doi: 10.1108/IJIS-10-2016-0038.
Denkowska, S., Fijorek, K., & Wegrzyn, G. (2020). Formal and non-formal edu-cation and training as an instrument fostering innovation and competitiveness in EU member countries. Journal of Competitiveness, 3, 82?98. doi: 10.7441/joc. 2020.03.05.
Doyle, E., & Perez-Alanis, M. (2017). From the concept to the measurement of sustainable competitiveness: social and environmental aspects. Entrepreneur-ial Business and Economics Review, 5(4), 35?59. doi: 10.15678/EBER.2017. 050402.
Duľová Spišáková, E., Gontkovičová, B., Majerníková, J., Spišák, E., & Pacana, A. (2019). Management of research and development activities in the context of strategy Europe 2020. Polish Journal of Management Studies, 19(2), 112?123. doi: 10.17512/pjms.2019.19.2.09.
Dutta, S., Lanvin, B., León, L. R., & Wunsch-Vincent, S. (Eds.) (2021). Global innovation index 2021. Tracking innovation through the COVID-19 crisis. WIPO: Geneva, Switzerland.
Dutta, S., Lanvin, B., & Wunsch-Vincent, S. (Eds.) (2014). Global innovation index 2014. The human factor in innovation. Cornell Universi-ty/INSEAD/WIPO: Fontainebleau, Ithaca, and Geneva.
ErvitsI. (2020). Quadrants of invention: individual patent applications as unu-tilized resource of innovative capacity. International Entrepreneurship Re-view, 6(1), 7?27. doi: 10.15678/IER.2020.0601.01.
European Commission, Directorate-General for Enterprise and Industry (2014). Innovation union scoreboard 2014, Publications Office. Retrieved from https://data.europa.eu/doi/10.2769/88936 (10.06.2022).
European Commission, Directorate-General for Internal Market, Industry, Entre-preneurship and SMEs (2021). Regional innovation scoreboard 2021. Publica-tions Office. Retrieved from https://data.europa.eu/doi/10.2873/674111 (10.06.2022).
European Commission (2019). European regional competitiveness index 2019. Publications Office 2019. Retrieved from https://ec.europa.eu/regional_policy/e n/information/maps/regional_competitiveness/ (26.06.2022).
Firlej, K. A. (2019). Expenditure on research and development activities as a determinant of the innovativeness of the European Union?s economy. Re-search Papers of the Wroclaw University of Economics, 550, 35?46. doi: 10.15611/pn. 2019.7.03.
Freimane, R., & B?li?a, S. (2016). Research and development expenditures and economic growth in the EU: a panel data analysis. Economics & Business, 29(1), 5?11. doi: 10.1515/eb-2016-0016.
Gault, F. (2018). Defining and measuring innovation in all sectors of the econo-my. Research Policy, 47(3), 617?622. doi: 10.1016/j.respol.2018.01.007.
Golejewska, A. (2013). Competitiveness, innovation and regional development. The case of the Visegrad group countries. Gospodarka Narodowa. The Polish Journal of Economics, 265(7-8), 87?112. doi:10.33119/GN/100953.
Guellec, D., & van Pottelsberghe de la Potterie, B. (2000). The impact of public R&D expenditure on business R&D. OECD Science, Technology and Industry Working Papers, 2000/04. doi: 10.1787/670385851815.
Hameed, K., Arshed, N., Yazdani, N., & Munir, M. (2021). Motivating business towards innovation: a panel data study using dynamic capability framework. Technology in Society, 65(C), 101581. doi: 10.1016/j.techsoc.2021.101581.
Hollanders, H., & Es-Sadki, N. (2021). European innovation scoreboard 2021. Publications Office of the European Union: Luxembourg, European Union.
Huňady, J., & Pisár, P. (2021). Innovation and invention in the EU business sec-tor: the role of the research and development expenditures. Interdisciplinary Description of Complex Systems, 19(2), 168?188. doi: 10.7906/indecs.19.2.1
Hunady, J., Pisar, P., Musa, H., & Musova, Z. (2017). Innovation support and economic development at the regional level: panel data evidence from Vise-grad countries. Journal of International Studies, 10(3), 147?160. doi: 10.14254/2071 -8330.2017/10-3/11.
IMD (2020). World competitiveness yearbook. Lausanne: IMD Competitiveness Center.
Ivanová, E., & Masárová, J. (2018a). Evaluation of innovation performance of Visegrad countries regions putting a stress on human capital. Social & Economic Revue, 16(2), 27?34.
Ivanová, E., & Masárová, J. (2018b). Performance evaluation of the Visegrad Group countries. Economic Research-Ekonomska Istraživanja, 31(1), 270?289. doi: 10.1080/1331677X.2018.
Ivanová, E., & Masárová, J. (2019). Differences in innovation performance of Visegrad Group regions. In V. Bevanda (Ed.) EMAN 2019 ? economics & management: how to cope with distrupted times. Conference Proceedings (pp. 635?640). Belgrade: Association of Economists and Managers of the Balkans. doi: 10.31410/EMAN.2019.635.
Ivus, O., Jose, M., & Sharma, R. (2021). R&D tax credit and innovation: evidence from private firms in India. Research Policy, 50(1), 104128. doi: 10.1016/j.r espol.2020.104128.
Janoskova, K., & Kral, P. (2019). An in-depth analysis of the summary innovation index in the V4 countries. Journal of Competitiveness, 11(2), 68?83. doi: 10.7441/joc.2019.02.05.
Jewell, C. (2021). Global innovation index 2021 ? tracking innovation through the COVID-19 crisis 2021. WIPO Magazine, 2021, 3.
Kalapouti, K., Petridis, K., Malesios, C., & Dey, P. K. (2020). Measuring effi-ciency of innovation using combined Data Envelopment Analysis and Struc-tural Equation Modeling: empirical study in EU regions. Annals of Operations Research, 294(1/2), 297?320. doi: 10.1007/s10479-017-2728-4.
Khedhaouria, A., & Thurik, R. (2017). Configurational conditions of national innovation capability: a fuzzy set analysis approach. Technological Forecast-ing and Social Change, 120, 48?58. doi: 10.1016/j.techfore.2017.04.005.
Kirillova, E., & Uvarova, N. (2021). Multilayered balanced indicators system for evaluating the results of innovation activities within the framework of cooper-ation. In N. Akatov & K. Antipyev (Eds.). SHS web of conferences, 10th annu-al international conference ?Schumpeterian readings?. ICSR. doi: 10.1051/shsc onf/202111600061.
Lei, L., Yuchen, Y., & Yuanchang, W. (2020). The impact of R&D input on tech-nological innovation: evidence from South Asian and Southeast Asian coun-tries. Discrete Dynamics in Nature and Society, 2020, 6408654. doi: 10.1155 /2020/6408654.
Lopez-Cabarcos, M. A., Pineiro-Chousa, J., & Quinoa-Pineiro, L. (2021). An approach to a country?s innovation considering cultural, economic, and social conditions. Economic Research-Ekonomska Istraživanja, 34(1), 2747?2766, doi: 10.1080/1331677X.2020.1838314.
Mamede, R. P. (2017). Structural asymmetries, innovation measurement and innovation policies in the EU. Portuguese Journal of Social Science, 16, 377?392. doi: 10.1386/pjss.16.3.377_1.
Mikhaylova, A. A., Mikhaylov, A. S, Oksana V. Savchina, O. V., & Plotnikova, A. P. (2019). Innovation landscape of the Baltic region. Administratie si Management Public, 33, 165?180. doi: 10.24818/amp/2019.33-10.
Misala, J. (2014). Theoretical grounds of the development of long-term competi-tive advantages in international trade. In M. A. Weresa (Ed.). Innovation, hu-man capital and trade competitiveness. How are they connected and why do they matter? (pp. 3?52). Cham?Heidelberg?New York?London: Springer.
Orozco, L. A., Sanabria, J. A., Sosa, J. C., Aristizabal, J., & López, L. (2022). How do IT investments interact with other resources to improve innovation? Journal of Business Research, 144, 358?365. doi: 10.1016/j.jbusres.2022.01.078.
Parrilli, M. D., Balavac, M., & Radicic, D. (2020). Business innovation modes and their impact on innovation outputs: regional variations and the nature of innovation across EU regions. Research Policy, 49(8), 104047. doi: 10.1016/j.resp ol.2020.
Pleśniarska, A. (2018). Research and development ? a strong or weak position of the EU in comparison with global competitors. Central and Eastern European Journal of Management and Economics, 6(2), 81?93. doi: 10.29015/ceejm e.722.
Porter, M. E. (2008). The five competitive forces that shape strategy. Harvard Business Review, 86, 79?93.
Preda, A. M., Crişan, D. A., Stănică, J. L., & Samuel, A. N. A. (2019). Innovation and ICT development: an analysis for the EU-28 Member States. Journal of Information Systems & Operations Management, 13(2), 154?163.
Pylak, K., & Wojnicka-Sycz, E. (2017). Transforming innovation models in Eu-ropean regions: breaking out of path dependency and growing faster? Miscellanea Geographica: Regional Studies on Development, 21(2), 51?59. doi: 10.1515/mgrsd-2017-0006.
Raymond, W., Mairesse, J., Mohnen, P., & Palm, F. (2015). Dynamic models of R&D, innovation and productivity: panel data evidence for Dutch and French manufacturing. European Economic Review, 78, 285?306. doi: 10.1016/j.euroe corev.2015.06.002.
Roszko-Wójtowicz, E., & Białek, J. (2019). Measurement of the average innova-tiveness change over time in the EU member states. Journal of Business Economics and Management, 20(2), 268?293. doi: 10.3846/jbem.2019.8337.
Roszko-Wójtowicz, E., & Białek, J. (2016). A multivariate approach in measuring innovation performance (Multivarijantni pristup u mjerenju inovacija). Zbor-nik Radova Ekonomskog Fakultet au Rijeci, 34(2), 443?479. doi: 10.18045/zbefri .2016.2.443.
Roszko-Wójtowicz, E., & Grzelak, M. M. (2020). Macroeconomic stability and the level of competitiveness in EU member states: a comparative dynamic ap-proach. Oeconomia Copernicana, 11(4), 657?688. doi: 10.24136/oc.2020.027.
Roszko-Wójtowicz, E., & Grzelak, M. M. (2021). Multidimensional analysis of regional investment attractiveness in Poland. Equilibrium. Quarterly Journal of Economics and Economic Policy, 16(1), 103?138. doi: 10.24136/ eq.2021.004.
Roszko-Wójtowicz, E., Grzelak, M. M., & Laskowska, I. (2019). The im-pact of research and development activity on the TFP level in manufacturing in Poland. Equilibrium. Quarterly Journal of Economics and Economic Policy, 14(4), 711?737. doi: 10.24136/eq.2019.033.
Roukanas, S. (2021). Measuring innovation of countries. Economies of the Balkan and Eastern European countries. KnE Social Sciences, 2021, 157?189. doi: 10.18502/kss.v5i9.9892.
Schwab, K. (2019). The global competitiveness report 2019. World Economic Forum: Geneva, Switzerland.
Sharma, A., Sousa, C., & Woodward, R. (2022). Determinants of innovation out-comes: the role of institutional quality. Technovation, 118, 102562. doi: 10.101 6/j.technovation.2022.10256.
Silaghi, M., Alexa, D., Jude, C., Litan, C. (2014). Do business and public sector research and development expenditures contribute to economic growth in Cen-tral and Eastern European countries? A dynamic panel estimation. Economic Modelling, 36, 108?119. doi: 10.1016/j.econmod.2013.08.035.
Sinclair-Desgagné, B. (2022). Measuring innovation and innovativeness: a data-mining approach. Quality & Quantity: International Journal of Methodology, 56(4), 2415?2434. doi: 10.1007/s11135-021-01231-6.
Skalický, R., Meluzín, T., Zinecker, M., Balcerzak, A. P., & Rogalska, E. (2022). Brand valuation: an innovative approach based on conversion ratios. Econom-ic Research-Ekonomska Istraživanja. Advance online publication. doi: 10.1080/1 331677X.2022.2097110.
Sochuľáková, J., (2020). Research and development expenditure and their im-portance for innovation development 2020. University Review, 14(4), 18?23.
Song, H., Zhao, Z., & Varma, A. (2022). The impact of sustainable input on re-gional innovation performance: moderating effects of policy support and cul-tural value. Sustainability, 14(19), 12706. doi: 10.3390/su141912706.
Stasiulis, N. (2017). The idea of the creative society and the development of crea-tive industries. Economics and Sociology, 10(2), 217?226. doi: 10.14254/2071-789X.2017/10-2/16.
Strahl, D., & Sobczak, R. (2017). Conceptual roots for innovation and innovative-ness of the economy in Poland. GeoScape, 11(1), 41?51. doi: 10.1515/geosc-2017-0004.
Szopik-Depczyńska, K., Cheba, K., Bąk, I., Kędzierska-Szczepaniak, A., Szczepa-niak, K., & Ioppolo, G. (2020). Innovation level and local development of EU regions. A new assessment approach. Land Use Policy, 99, 1?11. doi: 10.1016/j.landusepol.2020.104837.
Terzic, L. (2017). The role of innovation in fostering competitiveness and eco-nomic growth: evidence from developing economies. Comparative Economic Research ? Central and Eastern Europe, 20(4), 65?81. doi: 10.1515/cer-2017-0028.
Tsionas, M. (ed.) (2019). Panel data econometrics. Theory. Academic Press. doi: 10.1016/C2017-0-01562-8.
UNDP (2021). The global knowledge index 2021.
Weresa, M. A. (2015). Innovation and sustainable competitiveness: evidence from Poland. International Journal Transitions and Innovation Systems, 4(3/4), 150?163. doi: 10.1504/IJTIS.2015.077197
Węglarz, M. (2018). Innovation of the Polish economy in comparison with the EU member states. Economic and Environmental Studies, 18(2), 971?993. doi: 10.25167/ees.2018.46.31.
Wang, Z., & Qi, Z. (2021). Analysis of the influences of ICTs on enterprise inno-vation performance in China. Managerial and Decision Economics, 42, 474?478. doi: 10.1002/mde.3247.
Zhengwen, W, Hongli, Y., Fei, F., Yingfeng, F., & Hong, Z. (2022). Science and technology insurance and regional innovation: evidence from provincial panel data in China. Technology Analysis & Strategic Management. Advance online publication. doi: 10.1080/09537325.2022.2053518.
Zygmunt, A. (2022). The effect of research and development personnel on inno-vation activities of firms: Evidence from small and medium-sized enterprises from the Visegrad Group countries. Entrepreneurial Business and Economics Review, 10(3), 105?121. doi: 10.15678/EBER.2022.100307.
Žítek, V., Klímová, V., & Králová, M. (2016). Assessment of regional innovation systems as an assumption for innovation policy adjustment. Transylvanian Review of Administrative Sciences, 49E, 169?186.