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15INNOVATIVE DEVELOPMENT AND ITS INFLUENCE ON COMPETITIVENESS OF UKRAINE
Zhuravlova Yu.
Odessa National Economic University, Candidate of Sciences in Public Administration (PhD),
Doctoral Student
Abstract
In article the influence of innovative development on the competitiveness of the country is considered. The dynamics of the level of innovative development of Ukraine on the basis of The Global Innovation Index for 20112017 are analyzed. The strengths and weaknesses of the Ukrainian innovation system were identified.
Keywords: innovation development, intellectual potential, the Global Innovation Index, competitiveness, socio-economic development.
The urgency of the innovative model of development is due to the growing influence of science and new technologies on socio-economic development. Therefore, the strategic priority is the transfer of Ukraine's economy to an innovative way of development that will contribute to improving the quality of life of the population through the introduction of innovations, the use of new resource-saving technologies, updating the technological base.
Innovation activity is the main source of effective functioning of modern society. Economic growth, competitiveness of a country in the world depends, in particular, on such a key factor of innovation development as intellectual potential, its concentration and degree of development. Knowledge, as a public good, becomes the foundation of the global economy, and innovation is the stimulus of economic growth. At the same time, this requires additional investments that will stimulate the realization of creative abilities of a person and increase production volumes.
In addition, new technologies affect the nature of labor, accelerated pace of technological change requires an accelerated replacement of jobs with new ones, which in turn require different skills and knowledge [1, p.411]. Thus, special attention is needed to the development of innovative competence as the most important component of human potential.
The assessment of the state of innovation in Ukraine, the justification of strategic directions of the state's innovation development, and the development of
concrete proposals for its promotion are provided in a scientific report, edited by Geits V.M., Danilenko A.I., Libanova E.M., Gritsenko A.A., Makarova O.V., Ki-zima M.O., Egorova I.U., Odotyuk I.V. [2]. An analysis of approaches to assessing the impact of innovation on economic development is carried out Pisarenko T.V., Kvasha T.K., Karlyuk G.V., Lyakh L.V. [3], a comparative analysis of innovation development in Ukraine and other countries is in sight Amoshi O.I. and Niko-layenko A.I. [4]. Kramarenko A.V. analyzes the mechanism of interaction of innovative systems of Ukraine and the countries of the European Union on the basis of structural complementarity [5]. Assessment of the level of innovative development of Ukraine is given by Pal-amarchuk O.S. [6].
The purpose of the article is to analyze the dynamics of the level of innovative development of Ukraine on the basis of The Global Innovation Index and its impact on the country's competitiveness.
Report The Global Innovation Index 2017, co-sponsored by Cornell University, the INSEAD School of Business, and the World Intellectual Property Organization (WIPO), includes 81 innovation indicators and covers 127 countries that collectively produce 98% of world GDP. They are home to 92% of the population. The authors of the tenth ranking highlight the continuing gap in the innovative capabilities of developed and developing countries, the slow pace of increased research and development activity both in the public sector and at the corporate level [7].
Figure 1. Structure The Global Innovation Index — 2017 Source: [7, p.11].
As we see in Figure 1, the rating includes indicators of innovation activity, grouped in seven main areas: institutions; human capital and research; infrastructure; market sophistication; business sophistication; knowledge and technology development; creative outputs. The first five areas represent the Innovation Input Sub-Index, the last two - the Innovation Output Sub-Index. The final rating (GII-2017) is calculated as the average of these sub-indices.
Lead the ranking of leading innovation countries GII-2017 Switzerland, Sweden, the Netherlands, the United States and the United Kingdom. And Switzerland is heading the overall GII rating for the seventh consecutive year. High-income countries include twenty-four of its first twenty-five seats. An exception to this series is China, which ranked twenty-second. In 2016, China became the first middle-income country to enter that group.
Table 1.
Leaders in Innovation by Region
Region Rating Country Position at GII-2017
1 Switzerland 1
Europe 2 Sweden 2
3 Netherlands 3
South America 1 USA 4
2 Canada 18
Latin America and the Caribbean 1 Chile 46
2 Costa Rica 53
3 Mexico 58
Southeast Asia, East Asia and Oceania 1 Singapore 7
2 Republic of Korea 11
3 Japan 14
1 India 60
Central and South Asia 2 Iran 75
3 Kazakhstan 78
1 Israel 17
North Africa and West Asia 2 Cyprus 30
3 UAE 35
1 South Africa 57
Sub-Saharan Africa 2 Mauritius 64
3 Kenya 80
Source: [7].
Ukraine is ranks 33rd among the 35 leading European states [7, p.14].
Table 2.
Group of countries by income level
Indicator Rating Country Position at GII-2017
High-income countries (total 48 countries) 1 Switzerland 1
2 Sweden 2
3 Netherlands 3
Countries with an income above average (total 35 countries) 1 China 22
2 Bulgaria 36
3 Malaysia 37
Countries with lower income than average (total 27 countries) 1 Vietnam 47
2 Ukraine 50
3 Mongolia 52
Low income countries (total 17 countries) 1 Tanzania 96
2 Rwanda 99
3 Senegal 100
Source: [7, p.27 ].
As Table 2 shows, in GII-2017 countries are grouped by income. Ukraine belongs to the group of "countries with lower incomes" and ranks 2nd among 27 countries in its group.
In GII-2017, Ukraine ranks 50th, rising 6 positions in comparison with 2016: under the Innovation Output Sub-Index, Ukraine remained at the same position, and under the Innovation Input Sub-Index lost 1 position (Table 3).
Table 3.
The dynamics of Ukraine's position in The Global Innovation Index: 2011-2017
Years GII Innovation Output Innovation Innovation Effi-
(total number of coun- Sub-Index Input ciency Ratio
tries) Sub-Index
2017 (127) 50 40 77 11
2016 (128) 56 40 76 12
2015 (141) 64 47 84 15
2014 (143) 63 46 88 14
2013 (142) 71 58 83 31
2012 (141) 63 47 78 14
2011 (125) 60 52 67 40
Source: compiled by the author on the basis of [7-13].
The analysis of Table 3 shows that in The Global Innovation Index - 2017 Ukraine occupies the highest position (50) during 2011-2017 and improves the indicators compared to 2013 by Innovation Output Sub-Index by 18 positions, and by Innovation Input Sub-Index
- 11 positions (2014). The best indicators are observed: by the Innovation Output Sub-Index in 2016 and 2017
- 40; for Innovation Input Sub-Index - in 2011 (67).
Table 4.
Dynamics of Ukraine's position in the Global Innovation Index by the main indicators: 2011 -2017 years
Indicator Years
2011 2012 2013 2014 2015 2016 2017
Innovation Input Sub-Index 52 47 58 46 47 40 40
Institutions 103 117 105 103 98 101 101
Human capital & research 40 48 44 45 36 40 41
Infrastructure 101 98 91 107 112 99 90
Market sophistication 64 68 82 90 89 75 81
Business sophistication 45 51 79 87 78 73 51
Innovation Output Sub-Index 67 78 83 88 84 76 77
Knowledge & technology outputs 40 30 45 32 34 33 32
Creative outputs 70 83 81 77 75 58 49
It should be noted that in 2013 Ukraine ranked the lowest in the Global Innovation Index (71) and had the worst indicator for Innovation Output Sub-Index (58). Ukraine's worst indicator for Innovation Input Sub-Index (88) is observed in The Global Innovation Index -2014.
Source: compiled by the author on the basis of [7-13].
The data in Table 4 shows that during 2011-2017, the positions for indicators such as: institutions (at 2 positions), infrastructure (at 11 positions), knowledge & technology outputs (at 8 positions) and creative outputs (at 21 positions). Indicators have worsened their positions: human capital & research (at 1 position), market sophistication (at 17 positions), business sophistication (at 6 positions).
The best indicators are observed by indicators over the years: institutions (98th position, 2015); human capital & research (36th position, 2015), infrastructure (90th position in 2017); market sophistication (64th position in 2011); business sophistication (45th position
in 2011); knowledge & technology outputs (30th position in 2015); creative outputs (49th position in 2017).
The worst indicators are observed by indicators over the years: institutions (117th position in 2012); human capital & research (48th position in 2012); infrastructure (112th position in 2015); market sophistication (90th position in 2014); business sophistication (87th position in 2014); knowledge & technology outputs (45th position in 2013); creative outputs (83th position in 2012).
The rating assesses the strengths and weaknesses of the Ukrainian innovation system (Table 5).
Table 5.
Strengths and weaknesses of the innovation system of Ukraine: Global-2017
Strengths Weaknesses
Innovation Input Sub-Index
Institutions
Ease of starting a business (18) Political environment (122th position from 127 countries of the world)
Political stability and absence of violence/terrorism(124)
Regulatory quality (105)
Rule of law (110)
Ease of resolving insolvency (120)
Government effectiveness (96)
Human capital & research
Expenditure on education/ Government expenditure on education (% of GDP) (22)*
Government expenditure on education per pupil, secondary (% of GDP per capita) (22)*
Pupil-teacher ratio, secondary(2)
Tertiary enrolment(12)*
Graduates in science and engineering (28)*
Infrastructure
ICT use (93)
General infrastructure (108)
Gross capital formation (% of GDP) (108)
GDP per unit of energy use (112)
Market sophistication
Investment (107)
Intensity of local competition (99)
Business sophistication
Females employed with advanced degrees (3) State of cluster development (114)
GERD financed by abroad (23)
Innovation Output Sub-Index
Knowledge & technology outputs
Utility model applications by origin (1) Growth rate of GDP per person engaged (97)
Total computer software spending (6)
ICT services exports (15)
Patent applications by origin (18)
Creative outputs
Trademark application class count by origin (12) ICTs and business model creation (112)
Industrial designs by origin (11) National feature films produced (102)
Source: compiled by the author [7, p. 319-399]. * data provided for 2014
Analysis of Table 5 shows that among the competitive advantages of Ukraine there are applications for useful models of origin (1). By this indicator, Ukraine shares first position with China, the Republic of Korea and Moldova. The country has a high position in terms
of ratio of pupils / teacher in secondary education (2), employment of women with higher education (3), expenses for computer software (6). According to such an indicator characterizing the development of human
capital, as the gross coefficient of coverage of higher education, Ukraine ranks 12th position.
Among the weaknesses of the Ukrainian innovation system are the following indicators: political stability and lack of terrorism (124), political environment (122), rule of law (110), and state development of clusters (114). By GDP growth per capita, Ukraine ranks 97th, GDP per unit of energy use is 112th position.
Thus, it can be concluded that during 2011-2017 Ukraine has improved its position in the international ranking of The Global Innovation Index and in 2017 it is ranked 50th among 127 countries, which is the best indicator for the specified period.
Ukraine has a high educational and scientific potential. Knowledge, as a public good, becomes the main intangible asset, affects the growth of production volumes, which in turn affects the competitiveness of the country in the world.
Thus, among the strengths of the Ukrainian innovation system, indicators that characterize human capital and research can be noted; knowledge and technology development.
The weaknesses include, in particular, the institutional indicator and infrastructure. This indicates a lack of effective state innovation policy, which complicates the receipt of economic returns in the form of completed innovations and their implementation in various spheres of the economy. Therefore, the policy of the state should be directed, in particular, to the institutional provision of innovation activity.
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