Uncertainty and technological innovation: evidence from developed and developing countries

Uncertainty will not only harm the economy but may also provide an opportunity for technological innovation. It is well established from past studies that technological innovation is a useful tool for reducing uncertainty across countries. However, it is not known whether this uncertainty can contri...

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Bibliographic Details
Published in:Economic change and restructuring 2022-11, Vol.55 (4), p.2527-2545
Main Authors: Subramaniam, Yogeeswari, Loganathan, Nanthakumar
Format: Article
Language:English
Subjects:
Corruption
Developed countries
Developing countries
Development Economics
Economic Growth
Economic Policy
Economics
Economics and Finance
Industrialized nations
Innovations
Intellectual property
International Economics
LDCs
Macroeconomics/Monetary Economics//Financial Economics
Political Economy/Economic Systems
Population growth
Research & development expenditures
Technological change
Uncertainty
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Summary:Uncertainty will not only harm the economy but may also provide an opportunity for technological innovation. It is well established from past studies that technological innovation is a useful tool for reducing uncertainty across countries. However, it is not known whether this uncertainty can contribute to innovation across countries. Hence, in this study, we develop an empirical model to examine the impact of uncertainty on technological innovation across a global panel of both developed and developing countries over the period 2013–2018. Using generalized methods of moment (GMM), we find that uncertainty have significant negative and positive impact on technological innovation in developing and developed countries, respectively. Given these findings, the study argues that the role of uncertainty in improving technological innovation significantly varies across both developed and developing countries. Therefore, significant implications have to do with the fact that developing countries need to initiate effective action to look uncertainty as a key to unlocking opportunity, while developed countries should take into consideration that uncertainty is a viable strategy for addressing innovation ideas.
ISSN:1573-9414
1574-0277
DOI:10.1007/s10644-022-09402-7