The Impact of Global Innovation on Economic Growth in Developing Countries

The study aimed at identifying the effect of innovation on economic growth in developing countries, relying on it determinants, namely fixed capital formation, labor force, trade openness and the global innovation index (GII). The study relied on panel data for 32 developing countries covering the period (2011-2018). The FMOLS methodology was adopted to estimate the relationships between the above Mentioned variables. The study disclosed a positive and statistically significant relationship between economic growth and each of fixed capital formation, labor force and the global innovation index (GII). However, trade openness was statistically insignificant. The reached several conclusion regarding the efficiency of innovation to enhance growth such as, creating a suitable environment for institutions to work in, enhancing the effectiveness of education, increasing expenditure on scientific research, optimal investment in human capital, freeing markets, encouraging the increase in the size of business and innovation output also . The study recommended that developing countries should focus intensely on translating innovation policies into national strategies, which can have a positive effect on economic growth.