The roles of formal and informal institutions on innovations activity
This paper analyses the impact of institutions on the innovation level of countries. This analysis is performed by segregating the dimension of institution into two, namely formal institutions and informal institutions. Using samples of 62 cross-section countries and employing robust standard error...
| Main Authors: | , |
|---|---|
| Format: | Article |
| Language: | English |
| Published: |
Penerbit Universiti Kebangsaan Malaysia
2016
|
| Online Access: | http://psasir.upm.edu.my/id/eprint/57093/1/The%20roles%20of%20formal%20and%20informal%20institutions%20on%20innovations%20activity.pdf |
| _version_ | 1796976621265092608 |
|---|---|
| author | Lee, Weng Chang Law, Siong Hook |
| author_facet | Lee, Weng Chang Law, Siong Hook |
| author_sort | Lee, Weng Chang |
| collection | UPM |
| description | This paper analyses the impact of institutions on the innovation level of countries. This analysis is performed by segregating the dimension of institution into two, namely formal institutions and informal institutions. Using samples of 62 cross-section countries and employing robust standard error ordinary least squares (OLS) estimation, this study has found evidence that both formal and informal institutions affect the innovation level of countries. The results suggest that countries with higher formal institutions (institutional quality) and higher informal institutions (social capital) are associated with higher innovation levels. However, informal institutions demonstrate that at 10th percentile quantile estimations it exhibit a significant positive impact on innovation, while the formal institutions show such impact after exceeding the 50th percentile. Hence, this result suggests the formal institutions play important role when innovation level in a country is high. Both formal and informal institutions are crucial in influencing the level of country’s innovation. |
| first_indexed | 2024-03-06T09:28:21Z |
| format | Article |
| id | upm.eprints-57093 |
| institution | Universiti Putra Malaysia |
| language | English |
| last_indexed | 2024-03-06T09:28:21Z |
| publishDate | 2016 |
| publisher | Penerbit Universiti Kebangsaan Malaysia |
| record_format | dspace |
| spelling | upm.eprints-570932017-09-07T04:30:38Z http://psasir.upm.edu.my/id/eprint/57093/ The roles of formal and informal institutions on innovations activity Lee, Weng Chang Law, Siong Hook This paper analyses the impact of institutions on the innovation level of countries. This analysis is performed by segregating the dimension of institution into two, namely formal institutions and informal institutions. Using samples of 62 cross-section countries and employing robust standard error ordinary least squares (OLS) estimation, this study has found evidence that both formal and informal institutions affect the innovation level of countries. The results suggest that countries with higher formal institutions (institutional quality) and higher informal institutions (social capital) are associated with higher innovation levels. However, informal institutions demonstrate that at 10th percentile quantile estimations it exhibit a significant positive impact on innovation, while the formal institutions show such impact after exceeding the 50th percentile. Hence, this result suggests the formal institutions play important role when innovation level in a country is high. Both formal and informal institutions are crucial in influencing the level of country’s innovation. Penerbit Universiti Kebangsaan Malaysia 2016 Article PeerReviewed application/pdf en http://psasir.upm.edu.my/id/eprint/57093/1/The%20roles%20of%20formal%20and%20informal%20institutions%20on%20innovations%20activity.pdf Lee, Weng Chang and Law, Siong Hook (2016) The roles of formal and informal institutions on innovations activity. Jurnal Ekonomi Malaysia, 50 (2). pp. 167-179. ISSN 0126-1962 http://www.ukm.my/fep/jem/content/2016-2.html |
| spellingShingle | Lee, Weng Chang Law, Siong Hook The roles of formal and informal institutions on innovations activity |
| title | The roles of formal and informal institutions on innovations activity |
| title_full | The roles of formal and informal institutions on innovations activity |
| title_fullStr | The roles of formal and informal institutions on innovations activity |
| title_full_unstemmed | The roles of formal and informal institutions on innovations activity |
| title_short | The roles of formal and informal institutions on innovations activity |
| title_sort | roles of formal and informal institutions on innovations activity |
| url | http://psasir.upm.edu.my/id/eprint/57093/1/The%20roles%20of%20formal%20and%20informal%20institutions%20on%20innovations%20activity.pdf |
| work_keys_str_mv | AT leewengchang therolesofformalandinformalinstitutionsoninnovationsactivity AT lawsionghook therolesofformalandinformalinstitutionsoninnovationsactivity AT leewengchang rolesofformalandinformalinstitutionsoninnovationsactivity AT lawsionghook rolesofformalandinformalinstitutionsoninnovationsactivity |