Economic growth and gross domestic expenditure on R&D in G7 countries with some benchmarking with BRICS countries: Long-run comparative synergy analyses

Abstract

Background: This paper’s focus is on the synergy in GDP (Gross Domestic Product) and GERD (Gross Expenditure Research and Development) interaction in G7 countries. It allows us to present an explorative analysis of the relationships between key variables (in this case GDP and GERD). Further, it allows a critical synergy analysis on the long-run dynamics of economies. In this article, we demonstrated the methodological power of combining synergy analysis and conventional benchmarking analysis. Method: This study is based on statistical synergy methodology. Data about the G7 countries (USA, Canada, Germany, France, UK, Japan and Italy) was collected from the World Bank. Research question: How can the decree of synergy and trade-off between GERD and GDP impact innovation and knowledge management at a macroeconomic level. Results: The benefits of the synergy methodology include that it provides essential information for economic and social policy-makers. It is a new tool for sustainability analysis. The evaluation of a synergy/trade-off proposed in this paper indicates only a possible and potential causality. However, it does not infer a causal relationship between the variables. Conclusions: Normally, experts and decision-makers expect that there is positive synergy between GERD and GDP. However, finally it is a purely empirical question to evaluate. Synergy dynamics is different among G7 countries. The United Kingdom has the highest synergy level and Japan has the lowest. UK, France and USA have the highest long-run synergy levels among G7 countries. Almost all countries have improved synergy levels between GDP and GERD in the long run which indicates harder competition in the field of global innovation ecosystems.