The Innovation and Economic Growth Nexus: Lesson from G20 Nations

Abstract

This paper investigates the nexus between innovation and economic growth in some G20
countries in the period from 1960 to 2020. The data in this study was taken from World Bank Open Data and Nasdaq Data Link, combined with Pearson test, Hausman test, Wald test, Wooldridge test, FEM, REM model, ordinary least squares method and feasible general least squares method (FGLS). As a result, we find that innovation has a positive impact on economic growth of G20 countries, which means the higher the level of innovation activity, the higher the economic growth rate in these nations. Based on the empirical results, we recommend several experiences for Vietnam’s policy in innovation and economic growth.