Entrepreneurship, innovation and competitiveness: A public institution love triangle

Diverse and different research studies have approached the impact of the quality of public institutions on entrepreneurship, innovation and competitiveness. However, this relationship has not hitherto been subject to simultaneous study but rather only separately. In turn, our research thus holds the objective of simultaneously evaluating the impact of the quality of public institutions on entrepreneurship, innovation and competitiveness based on data aggregated at the OECD member state level. We therefore seek to demonstrate how the higher the perceptions of public institution quality held by individuals, the higher the indices of entrepreneurship, innovation and competitiveness. To this end, we deploy data collected from various sources, specifically the United Nations (UN), the World Bank (WB), the Organisation for Economic Cooperation and Development (OECD), World Intellectual Property Organization (WIPO), Global Entrepreneurship Monitor (GEM), World Economic Forum (WEF), International Bank for Reconstruction and Development (IBRD) and Freedom House (FH), for the years between 2006 and 2018 (13 years). For the analysis of this data, we apply an econometric methodology based on multiple regression models for unbalanced panel data. We may thus report that the higher the perception of quality of public institutions, the greater the level of the variables applied for entrepreneurship, innovation and competitiveness. We believe our empirical results contain important implications whether for researchers, politicians and decision-makers involved in drafting public policies.