Governance and innovation-based strategic autonomy: an exploratory study

Gouvernance et autonomie stratégique par l’innovation: Une étude exploratoire

Dorgyles Kouakou () and Eva Szego ()
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Dorgyles Kouakou: UEA - Unité d'Économie Appliquée - ENSTA Paris - École Nationale Supérieure de Techniques Avancées - IP Paris - Institut Polytechnique de Paris
Eva Szego: UEA - Unité d'Économie Appliquée - ENSTA Paris - École Nationale Supérieure de Techniques Avancées - IP Paris - Institut Polytechnique de Paris

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Abstract: The identification of ways to increase strategic autonomy, that is, a country's ability to ensure its autonomy in strategic sectors (e.g. defense activities) has attracted increased interest recently. Such an autonomy can be perceived in terms of innovation. More precisely, this involves both having the knowledge and technologies to act alone and being able to influence technical progress at an international level. This is referred to as "innovation-led strategic autonomy". In this paper, we study the determinants of innovation-led strategic autonomy using panel data from 33 countries worldwide, observed over the period 2000-2015. Our main focus is on governance (economic, institutional, and political), that is, to what extent differences in strategic autonomy between countries can be attributed to differentiated levels of governance. Country-level strategic autonomy scores are calculated using patent data from the European Patent Office, and relying on the economic dominance theory and structural economic methods. At the level of governance, data from the Worldwide Governance Indicators (WGI) are exploited. The estimation strategy is based on random- and fixed-effects panel regressions. Then, a Hausman test allows to highlight the model that fits the data better. It emerges that "voice and accountability" is correlated positively with innovation-led strategic autonomy. That is, countries with better participation of citizens in selecting their rulers, freedom of expression, free press, and freedom of association, exhibit greater innovation-led strategic autonomy. The greater the likelihood of terrorism, politically-motivated violence, and, more generally, destabilization or overthrow of the government, the greater a country's level of strategic autonomy. Hence, political governance appears to be critical in explaining the differentials in strategic autonomy between countries. At the level of the control variables, military expenditures are found to be correlated positively with strategic autonomy. Results also show the association between investment and innovation-led strategic autonomy to be U-shaped. That is, there is a minimum level of investment to be achieved so that increases in investment can result in increases in strategic autonomy. We conclude by discussing policy implications.

Keywords: Strategic autonomy; innovation; governance; patent (search for similar items in EconPapers)
Date: 2022-06-30
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Published in 25th International Conference on Economics and Security, J. Paul Dunne; Luca Pieroni, Jun 2022, Perugia (Italy), Italy

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