THE IMPACT OF INNOVATION ON ECONOMIC GROWTH IN ALGERIA: AN ECONOMETRIC ANALYSIS USING THE ARDL MODEL (1996–2021)

Abstract

The present study has been conducted for the purpose of analysing the relationship between innovation and economic growth in Algeria during the period 1996-2021. The study adopted a standard quantitative analytical approach using the augmented distributed lag regression (ARDL) model to estimate the relationships. The model was applied to a sample of 24 observations using EViews version 12. The study addressed four independent variables: high and medium technology exports, patent applications by residents, patent applications by non-residents, and scientific and technological articles. The findings indicated a negative correlation between high- and medium-technology exports and gross domestic product (GDP), with no discernible impact on the latter. Conversely, scientific and technological articles exhibited a positive correlation with GDP, albeit without exerting an effect on the immediate economic landscape. Furthermore, patent applications by residents demonstrated a negative correlation with GDP, affecting it in both the short and long term. In contrast, patent applications by non-residents exhibited a negative effect on GDP in the long term. In light of the findings, it is evident that innovation in Algeria is characterised by inefficiency and economic unproductivity within the prevailing structural framework. This necessitates a thorough re-evaluation of the policies and strategies associated with the national innovation system and Algerian economic growth by the state.