Abstract:

During the past decade, the World Economic Forum has published its annual reports in which the Global Competitiveness Index is included. This paper aims to investigate the key factors for achieving an innovation-driven economy. In this paper, we used partial canonical correlation analysis (PCCA) to examine the relationships between key pillars in “efficiency enhancers” and “business sophistication” factors. The results of Pearson correlation showed that “technological readiness” and “innovation” are highly correlated. Then, the PCCA method was used to understand the relationships between their sub-pillars. Our findings showed that “availability of latest technologies” and “firm-level technology absorption” in the technological readiness pillar, and “quality of scientific research institutions”, “university-industry collaboration in R&D” and “companies’ spending on R&D” in the innovation pillar present the highest correlations. Furthermore, according to the canonical second root analysis, we analyse some other interrelations. Thus, policymakers can employ the results to prioritize their macro policies.

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