Financial Drivers of Innovation: An Analysis of Its Determinants in G10 Nations

Tianqi Xiong

doi:10.54254/2754-1169/2025.19879

Research Article

Open access

Published on 9 January 2025

Download pdf

Xiong,T. (2025). Financial Drivers of Innovation: An Analysis of Its Determinants in G10 Nations. Advances in Economics, Management and Political Sciences,161,24-33.

Export citation

Financial Drivers of Innovation: An Analysis of Its Determinants in G10 Nations

Tianqi Xiong *^,1,

¹ University College London (UCL)

* Author to whom correspondence should be addressed.

https://doi.org/10.54254/2754-1169/2025.19879

Abstract

Innovation plays a crucial role in the financial growth and development of the nation. This is because an increase in portfolio investment attracts foreign capital into the economy, which further adds to innovation due to increased capital. In addition, financial growth signifies a rise in the production of goods and services in an economy, which further stimulates the wages and profitability of businesses in the long run. Thus, this research incorporates a panel data analysis to explore the association between financial determinants and innovation index in G10 economies using the RE model, the FE model, and the Hausman test. The results of the research indicate that a rise in financial determinants adds to the innovation index in G10 economies

Keywords

Innovation index, financial growth, portfolio investment, capitalization

View pdf

References

[1]. UK Government (2024) G10 nations to harness AI and innovation to drive growth and productivity. https://www.gov.uk/government/news/G10-nations-to-harness-ai-and-innovation-to-drive-growth-and-productivity#:~:text=G10%20nations%20have%20signed%20an,global%20productivity%20and%20economic%20growth.&text=the%20public%20sector-,G10%20nations%20have%20signed%20an%20agreement%20to%20unite%20and%20harness,global%20productivity%20and%20economic%20growth.

[2]. WIPO (2024) Global Innovation Index. https://www.wipo.int/web/global-innovation-index

[3]. IGI Global (2024) What is Financial Factors? https://www.igi-global.com/dictionary/financial-factors/39752

[4]. Khraisha, T., Arthur, K. (2018) Can we have a general theory of financial innovation processes? A conceptual review. Financial Innovation, 4: 1-27.

[5]. Khan, A., Chenggang, Y., Hussain, J., Kui, Z. (2021) Impact of technological innovation, financial development and foreign direct investment on renewable energy, non-renewable energy and the environment in belt & Road Initiative countries. Renewable Energy, 171: 479-491.

[6]. García-Quevedo, J., Segarra-Blasco, A., Teruel, M. (2018) Financial constraints and the failure of innovation projects. Technological forecasting and social change, 127: 127-140.

[7]. Smol, M., Kulczycka, J., Avdiushchenko, A. (2017) Circular economy indicators in relation to eco-innovation in European regions. Clean Technologies and Environmental Policy, 19: 669-678.

[8]. Dziallas, M., Blind, K. (2019) Innovation indicators throughout the innovation process: An extensive literature analysis. Technovation, 80: 3-29.

[9]. Bloomfield, J., Fisher, M.J. (2019) Quantitative research design. Journal of the Australasian Rehabilitation Nurses Association, 22(2): 27-30.

[10]. Park, Y.S., Konge, L., Artino Jr, A.R. (2020) The positivism paradigm of research. Academic medicine, 95(5): 690-694.

[11]. World Development Indicators (2024) Data Bank. https://databank.worldbank.org/source/world-development-indicators#

Cite this article

Xiong,T. (2025). Financial Drivers of Innovation: An Analysis of Its Determinants in G10 Nations. Advances in Economics, Management and Political Sciences,161,24-33.

Data availability

The datasets used and/or analyzed during the current study will be available from the authors upon reasonable request.

Disclaimer/Publisher's Note

The statements, opinions and data contained in all publications are solely those of the individual author(s) and contributor(s) and not of EWA Publishing and/or the editor(s). EWA Publishing and/or the editor(s) disclaim responsibility for any injury to people or property resulting from any ideas, methods, instructions or products referred to in the content.

About volume

Volume title: Proceedings of the 4th International Conference on Business and Policy Studies

Conference website: https://2025.confbps.org/

ISBN：978-1-83558-895-6(Print) / 978-1-83558-896-3(Online)

Conference date: 20 February 2025

Editor：Canh Thien Dang

Series: Advances in Economics, Management and Political Sciences

Volume number: Vol.161

ISSN：2754-1169(Print) / 2754-1177(Online)

© 2024 by the author(s). Licensee EWA Publishing, Oxford, UK. This article is an open access article distributed under the terms and conditions of the Creative Commons Attribution (CC BY) license. Authors who publish this series agree to the following terms:
1. Authors retain copyright and grant the series right of first publication with the work simultaneously licensed under a Creative Commons Attribution License that allows others to share the work with an acknowledgment of the work's authorship and initial publication in this series.
2. Authors are able to enter into separate, additional contractual arrangements for the non-exclusive distribution of the series's published version of the work (e.g., post it to an institutional repository or publish it in a book), with an acknowledgment of its initial publication in this series.
3. Authors are permitted and encouraged to post their work online (e.g., in institutional repositories or on their website) prior to and during the submission process, as it can lead to productive exchanges, as well as earlier and greater citation of published work (See Open access policy for details).