Specific Effect of Innovation Factors on Socioeconomic Development of Countries in View of the Global Crisis

Round 1

Reviewer 1 Report

Comments and Suggestions for Authors

To mitigate the socioeconomic consequences of COVID-19, numerous countries have implemented various measures, including accelerating innovation development. Drawing from this context, the authors conducted a series of tests examining the relationships between socioeconomic indicators. However, there are still some issues that need to be addressed. There remain some problems.

1.       Many scholars have conducted research on the impact of various socio-economic indicators. What are the unique characteristics of this study compared to the existing research?

2.       This paper has tried to explore the specific effects of innovation factors on socioeconomic development. However, the empirical results are highly fragmented and lack systematic organization.

3.       The structure and layout of the article need to be improved. For example, the introduction and literature review be combined as the introduction is to provide practical significance of this study while the literature review is to provide its theoretical background.

4.       Literature review requires not only sorting out existing relevant literature, but also reviewing the literature, and finally explaining the research contributions of this article.

5.       The research design of this article is not sufficiently clear and needs to clearly specify the variables, data, and other content.

Regrettably, due to these concerns, this article is rejected. Thank you for giving us the opportunity to consider your work!

Comments on the Quality of English Language

Minor editing of English language required!

Author Response

Comment 1: Many scholars have conducted research on the impact of various socio-economic indicators. What are the unique characteristics of this study compared to the existing research?

Response 1: Thank you for this comment. If this question occurs, then the manuscript lacks to clarify this point enough. Nevertheless, the unique characteristics of our research stem from the following assertions:

- firstly, we have determined the dynamic differences in innovation factors for the countries from five socioeconomic models during the global crisis period. It provides an opportunity to develop specific measures for each country to prevent and eliminate the consequences of the crisis-induced factors. There are neither relevant studies regarding grouping of the countries conducted previously;

- secondly, we have identified the patterns of influence of some innovation factors on the economic performance of the countries. It provides an opportunity to develop specific measures to concentrate resources on the development of individual innovation factors, thereby increasing the potential for GDP growth per capita and reducing inflation.

The work by Dempere et al. (Dempere, Juan, Muhammad Qamar, Hesham Allam, and Sabir Malik. 2023. The impact of innovation on economic growth, foreign direct investment, and self-employment: A global perspective. Economies 11: 182. doi: 10.3390/economies11070182) is the most similar-sounding research in terms of the methodology. Having analyzed a sample of 120 countries, the authors provided a holistic evaluation of national innovation using generalized-linear and panel-corrected standard-error models. The obtained results revealed that innovation positively influenced the GDP, domestic institutional framework, local infrastructure, etc. In contrast, innovation negatively correlated with domestic self-employment, often associated with necessity-driven entrepreneurship. In addition, a negative impact was also identified in relation to domestic self-employment, often associated with entrepreneurship. It should be noted that the chosen 2013–2019 period was characterized by relative economic stability. As for our research, it was aimed at searching for patterns of influence of innovation factors on the economy during the period of drastic changes (the 2020–2022 global crises). This research aspect was neither previously found in the scientific literature, nor the methodology was of a very sparse nature. We have added some relevant references to the Literature Review Section (subsection 2.3) that highlight the uniqueness of our research compared to those currently available.

Comment 2: This paper has tried to explore the specific effects of innovation factors on socioeconomic development. However, the empirical results are highly fragmented and lack systematic organization.

Response 2: Thank you for this comment. The structure of this particular part of the study is based on a consistent analysis of each innovation pillar effect on socioeconomic factors. The designated sequence is dually represented, that is, by content and time. First, we have investigated the impact of each innovation pillar on the selected socioeconomic indicators. Second, we have assessed the impact of the innovation pillars on socioeconomic factors according to the following arrangement: the impact of 2019 innovation indicators on the economic performance indicators for 2020 (subsubsection 4.2.1); the impact of 2019 innovation indicators on the economic performance indicators for 2021 (subsubsection 4.2.3); the impact of 2019 innovation indicators on the economic performance indicators for 2022 (the impact has not been proven); the impact of 2020 innovation indicators on the economic performance indicators for 2020 (subsubsection 4.2.2); the impact of 2021 innovation indicators on the economic performance indicators for 2021 (subsubsection 4.2.4); and the impact of 2022 innovation indicators on the economic performance indicators for 2022 (the impact has not been proven). Probably, the work lacks a transparent research scheme, because we have only outlined those patterns of influence that were proven by statistical tests, being challenging occasionally. However, there are correlation coefficients for the whole lot of relationships provided in the Appendix, including those that failed to prove the reliability thereof via validation tests. This factor should enhance the understanding of the entire empirical analysis structure.

Comment 3: The structure and layout of the article need to be improved. For example, the introduction and literature review be combined as the introduction is to provide practical significance of this study while the literature review is to provide its theoretical background.

Response 3: Thank you for this comment. We have attempted to structure an introductory part with the key theses on the applicability of our research, thus specifying the relevance and significance of the topic. As for the review of previously conducted studies related to the investigated issue, it was arranged in a special section to highlight the formation of a research base to be built up using the results obtained. When working on the manuscript, we planned to make sure that researchers interested in such topics would grasp an idea of enhancing scientific knowledge regarding previously obtained results presented in the Literature Review Section. Thus, it seems appropriate to single out literature review into a special section for making this task easier. Apropos of the practical significance of the conducted research, it is specified in the final section of the manuscript.

Comment 4: Literature review requires not only sorting out existing relevant literature, but also reviewing the literature, and finally explaining the research contributions of this article.

Response 4: We have thoroughly reviewed the literature and reinforced the survey by adding a number of critical comments to better understand the current state of the investigated problem (section 2.1). Besides, we have analyzed some sources that consider the problem of the influence of innovation factors on economic performance, and emphasized certain limitations of the previously obtained results (section 2.3).

Comment 5: The research design of this article is not sufficiently clear and needs to clearly specify the variables, data, and other content.

Response 5: We have finalized the methodological part of the work in terms of specifying the variables and data. Thus, Section 3 was renamed as Data and Methodology, and it was restructured for the explicit presentation. In particular, we have identified several methodological steps to be implemented for the research purposes:

1. An analysis of some indicators for the level of innovation development of the countries.
2. An assessment of the impact of innovation indicators on some indices of socioeconomic development for 20 countries from the analyzed socioeconomic models.
3. Calculation of potential values of economic performance indicators when changing the levels of individual innovation factors based on the obtained econometric regression models.

Section 3 describes the steps in detail.

Figures 2-6 have been modified. For better understanding and clarity, we have calculated the data and constructed a graph representing the average values ​​of the dynamics of innovation factors for the countries from each socioeconomic model. This made it possible to more indicatively present the specifics of changes in innovativeness peculiar to the countries from each model and to more clearly conduct a comparative analysis of the dynamics of innovation factors between different models.

Comment 6: Minor editing of English language required!

Response 6:    We have carefully checked the entire manuscript, revised the wording, and made the necessary adjustments (highlighted in red in the text).

Reviewer 2 Report

Comments and Suggestions for Authors

Please state the research aim clearly in your introduction.  As it is presented, we cannot see the research value of the paper. The literature review is solid. However, you should highlight additional sources related to the Impact of Innovation on Socioeconomic Indicators. How did you decide on the delayed effect of innovation on economic indicators? This should be explained in the methodology. Do you think it was possible to do some additional quantitative analysis to compare different models (e.g. using t-test)? You are showing the results of regression in the findings, but you should elaborate on this in the methodology as well. In the conclusion, show the practical applications of your study. 

Author Response

Comment 1: Please state the research aim clearly in your introduction.  As it is presented, we cannot see the research value of the paper.

Response 1: We have formulated the purpose of the study in the Introduction Section as follows:

“The purpose of this article is to determine the specific dynamics of innovative behavior of the countries from different socioeconomic models during the global crisis, to identify the key innovation factors affecting the economic performance of the countries, and to calculate the expected potential for economic growth with the development of innovativeness.”

Furthermore, we have added a number of research questions to be answered within the research framework:

“Here are some specific research questions addressed in this study: Which innovation factors are most vulnerable in the countries from different socioeconomic models during the global crisis? What are the specifics of the dynamics thereof in different crisis periods? Is it feasible to identify the innovation factors affecting the economic performance of the countries using statistical analysis? What are the existing patterns of influence? What is the potential for economic growth, determined by the development level of innovation factors?”

Comment 2: The literature review is solid. However, you should highlight additional sources related to the Impact of Innovation on Socioeconomic Indicators.

Response 2: Thank you for this comment. We have expanded the review of studies related to assessing the impact of innovation factors on socioeconomic indicators. Wherein, certain works dealt with a period of relative stability, others addressed a crisis stage, and some papers considered forecast estimates. A common drawback of the conducted research into the impact of innovation on socioeconomic development is an insufficient amount of innovation factors analyzed, thus limiting the likely reliable research findings.

Comment 3: How did you decide on the delayed effect of innovation on economic indicators? This should be explained in the methodology.

Response 3: In Section 3, we have detailed the procedure for selecting periods for innovation and economic performance indicator values to conduct correlation and regression analysis. On the one hand, the delayed analysis over a period of several years is urgent to understand the importance of establishing a system of innovation development prior to the crisis onset (until 2019 inclusive). On the other hand, it provides an insight of the inherent potential of innovation development to improve the sustainability of economic performance indicators during the crisis period (2022–2022). A quick positive response of the economy is extremely important during a crisis; hence it is vital to identify the key factors of innovation development. The initial quantitative values for the indicators of the designated periods are given in Appendix A.

Comment 4: Do you think it was possible to do some additional quantitative analysis to compare different models (e.g. using t-test)?

Response 4: Thank you for this comment. We have modified Figures 2-6 for the greater clarity of the comparative analysis of the dynamics of the Global Innovation Index pillars for the countries from different socioeconomic models. We have calculated the average values ​​to determine the specifics of changes in innovation factors within each model by year and to compare these changes between the models. In this case, quantitative analysis methods would provide a low level of reliability, since a limited range of data compared hinders validation testing. In the future, we will attempt to expand the scope of data to enhance the capacity of quantitative assessments in comparative analysis.

Comment 5: You are showing the results of regression in the findings, but you should elaborate on this in the methodology as well.

Response 5: We have changed the structure of Section 3 (Data and Methodology) and added some critical disclosures:

“Correlation and regression analysis was performed in terms of close relationship between 2019 innovation indicators and economic performance indicators for 2020 (the effect on the economy delayed by 1 year relative to the year of assessment of innovation factors); for 2021 (the effect on the economy delayed by 2 years relative to the year of assessment of innovation factors); and for 2022 (the effect on the economy delayed by 3 years relative to the year of assessment of innovation factors). The delayed analysis over a period of several years is urgent to understand the importance of establishing a system of innovation development prior to the crisis onset. It also provides an insight of the inherent potential of innovation development to improve the sustainability of economic performance indicators during the crisis period.

A correlation and regression analysis was also carried out within a year (without any delay) to analyze the close relationship between the level of innovation factor development and economic performance: between 2020 innovation indicators and economic performance indicators for 2020; between 2021 innovation indicators and economic performance indicators for 2021; between 2022 innovation indicators and economic performance indicators for 2022. A quick positive response of the economy is extremely important during a crisis; hence it is vital to identify the key factors of innovation development. The initial quantitative values for the indicators of the designated periods that undergone correlation and regression analysis are given in Appendix A.

As a result, a list of innovation factors influential to economic development was determined, and the reliability of the identified connections was proven. A number of econometric regression models were built and presented graphically.

3. Calculation of potential values of economic performance indicators when changing the levels of individual innovation factors based on the obtained econometric regression models. Wherein, the calculation was made for the minimum and maximum initial values of innovation levels for each GII pillar.

The research results have evidenced the effect of each specific indicator of innovation activity for a certain year on socioeconomic indicators measured during the global crisis.”

Comment 6: In the conclusion, show the practical applications of your study. 

Response 6: We have added some recommendations regarding practical application of the results obtained to Section 5:

 “The results obtained have practical significance in the development of strategic and tactical measures to stimulate innovation development. Firstly, governments of the countries from different socioeconomic models should pay attention to the innovation pillars that were most affected during the crisis (these factors differ depending on the model a particular country belongs to). Secondly, when forming a budget for supporting innovation, one should focus on the presented key innovation groups influencing socioeconomic performance. Finally, to forecast economic development, in particular, GDP per capita or inflation, one should consider the potential for the growth thereof with an increase in the values of innovation pillars, including the inherent specific indicators.”

Reviewer 3 Report

Comments and Suggestions for Authors

The article "Specific Effect of Innovation Factors on Socioeconomic Development of Countries in View of the Global Crisis" examines the influence of innovation on economic performance indicators across selected countries worldwide from 2019 to 2022. The authors aimed to evaluate the relationship between increases in GDP and decreases in inflation and unemployment, and the level of innovation development at the country level, as measured by pillars of the Global Innovation Index (GII) such as Institutions, Human Capital and Research, Infrastructure, Market Sophistication, Business Sophistication, Knowledge and Technology Outputs, and Creative Outputs. Empirical research relied on data from the Global Innovation Index and its seven pillars, as published by the World Intellectual Property Organization.

Strengths of this study include its significant relevance to socioeconomic development, the suitability of the applied research methods, clear presentation of research findings, an up-to-date bibliographic review, and readability.

Suggestions for improvement include:

1.       Expanding the abstract to include the spatial and temporal scope of the empirical research and the research methods employed.

2.       Supplementing the Introduction with research questions and hypotheses.

3.       Expanding Part 2.3, The Impact of Innovation on Socioeconomic Indicators, which is directly relevant to the article's subject matter.

4.       Providing a more detailed explanation in Part 3, Methodology, regarding the criteria for selecting countries and delineating socio-economic models. Additionally, it would be beneficial to present the stages of the research procedure in a more organized manner.

5.       Considering the use of precise values for xmin and xmax based on data from the appendix in Part 4, Results.

In my opinion, after addressing these suggestions, the article qualifies for publication in the journal "Economies."

Author Response

Comment 1: Expanding the abstract to include the spatial and temporal scope of the empirical research and the research methods employed.

Response 1: Thank you for this comment. The Abstract has been supplemented with the relevant information:

 “The conducted research analysis covered the period from 2019 to 2022 based on the data for the GII pillar development level and economic performance indicators for 20 countries from five socioeconomic models. Descriptive and comparative statistics, as well as correlation and regression analysis were used to prove that innovation development is a key driver in increasing GDP and reducing inflation. Special attention should be paid to such GII pillars as Institutions and Human capital and research to increase the GDP value, while Infrastructure and Human capital research are the pillars underlying inflation reduction.”

Comment 2: Supplementing the Introduction with research questions and hypotheses.

Response 2: We have added the following information to the Introduction Section:

 “The purpose of this article is to determine the specific dynamics of innovative behavior of the countries from different socioeconomic models during the global crisis, to identify the key innovation factors affecting the economic performance of the countries, and to calculate the expected potential for economic growth with the development of innovativeness.

Here are some specific research questions addressed in this study: Which innovation factors are most vulnerable in the countries from different socioeconomic models during the global crisis? What are the specifics of the dynamics thereof in different crisis periods? Is it feasible to identify the innovation factors affecting the economic performance of the countries using statistical analysis? What are the existing patterns of influence? What is the potential for economic growth, determined by the development level of innovation factors?

To consider these issues, the methods of descriptive and comparative statistics, as well as correlation and regression analysis were used.”

Comment 3:  Expanding Part 2.3, The Impact of Innovation on Socioeconomic Indicators, which is directly relevant to the article's subject matter.

Response 3: Thank you for this comment. We have expanded the review of studies related to assessing the impact of innovation factors on socioeconomic indicators. Wherein, certain works dealt with a period of relative stability, others addressed a crisis stage, and some papers considered forecast estimates. A common drawback of the conducted research into the impact of innovation on socioeconomic development is an insufficient amount of innovation factors analyzed, thus limiting the likely reliable research findings.

Comment 4:  Providing a more detailed explanation in Part 3, Methodology, regarding the criteria for selecting countries and delineating socio-economic models. Additionally, it would be beneficial to present the stages of the research procedure in a more organized manner.

Response 4: The criteria for selecting countries appropriate to a particular socioeconomic model, as well as specific features of each model were detailed in our earlier publication (Vasin, Sergey M. 2022. Comparative analysis of socioeconomic models in COVID-19 pandemic. Economies 10: 278. doi: 10.3390/economies10110278) presented in the References. We have not cited this manuscript, since the presented research is done within the scope devoted to the development of the theory and practice of socioeconomic dynamics.

We have finalized the methodological part of the work in terms of specifying the variables and data. Thus, Section 3 was renamed as Data and Methodology, and it was restructured for the explicit presentation. In particular, we have identified several methodological steps to be implemented for the research purposes:

1. An analysis of some indicators for the level of innovation development of the countries.
2. An assessment of the impact of innovation indicators on some indices of socioeconomic development for 20 countries from the analyzed socioeconomic models.
3. Calculation of potential values of economic performance indicators when changing the levels of individual innovation factors based on the obtained econometric regression models.

Section 3 describes the steps in detail.

Comment 5: Considering the use of precise values for x_min and x_max based on data from the appendix in Part 4, Results.

Response 5: Thank you for this comment. We have recalculated the values ​​of growth potential for performance indicators based on the precise values ​​for x_min and x_max for the GII pillar indicators. In some cases, the resulting values ​​may notably vary despite minor changes in the independent variables.

Round 2

Reviewer 1 Report

Comments and Suggestions for Authors

The manuscript was revised, but Quality of the revised manuscript is not meet the publication standard.

Comments on the Quality of English Language

Minor editing of English language required!

Author Response

Please see the attachment.

Author Response File: Author Response.pdf

Reviewer 2 Report

Comments and Suggestions for Authors

Some improvements have been made according to my comments. Still, for my comment  4: Do you think it is possible to do some additional quantitative analysis to compare different models (e.g. using a t-test), you have modified figures? However, these figures do not tell us the significance of the difference between these models. Again, the t-test (or ANOVA) is required if we want to have clear information on this 

Author Response

Please see the attachment.

Author Response File: Author Response.pdf

Reviewer 3 Report

Comments and Suggestions for Authors

Accept in present form.

Author Response

Thank you for your feedback!

Round 3

Reviewer 2 Report

Comments and Suggestions for Authors

The paper is significantly improved with additional analyses (t-test paired comparison). This is elaborated in the methodology, with full results given in the findings. The literature review if further extended provides additional value to the manuscript. I am satisfied on how the authors addressed my other comments that I provided in the previous revision phases. 

Author Response

Please see the attachment.

Author Response File: Author Response.pdf