The Technological Potential of Innovation Ecosystems

Federico Moscatelli, Julio Raffo, Shreyas Gadgin Matha, Christian Chacua, Matté Hartog, Eduardo Hernandez Rodriguez and Muhammed A. Yildirim

No 90, WIPO Economic Research Working Papers from World Intellectual Property Organization - Economics and Statistics Division

Abstract: In developing countries' innovation activities, limited patenting suggests structural gaps that hinder technological progress. This paper investigates whether countries can leverage their scientific and productive capabilities to realize untapped technological potential. We analyze connections between trade, science, and technology across global innovation ecosystems and introduce an indicator to assess where countries are positioned to expand their technological capabilities. Our results show that the indicator predicts technological output growth, though growth slows when countries exceed their predicted potential, indicating diminishing returns. The indicator performs better in more complex ecosystems. These findings provide valuable insights for policymakers, offering a framework to address weaknesses in innovation ecosystems and foster balanced, sustainable technological development.

Keywords: Innovation capabilities; complexity metrics; innovation ecosystems; science and technology policies; industrial policy; economic development; smart specialization (search for similar items in EconPapers)
JEL-codes: O11 O14 O25 O31 O33 (search for similar items in EconPapers)
Date: 2026-01
New Economics Papers: this item is included in nep-cse and nep-sbm
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