Efficacy of the WIPO Global Innovation Index as a Driver of Innovation: Analysis of GII Data for the ten ASEAN Economies

Abstract

There is a worldwide trend to take account of the WIPO Global Innovation Index (GII) when driving the innovation potential of national economies at a high level as well as at the micro level to encourage local industries. Analysis of the background data shows that such approaches might be misplaced. This study is an in-depth analysis of the underlying GII data of the ten ASEAN economies to determine each economy's patterns, strengths, and weaknesses. The literature guides which pillars and sub-pillars for innovation should be assessed. Analysis should keep at the front of mind that developing nations have significantly differentiated institutional structures, so policy measures from one system cannot be simply taken from one jurisdiction and applied to another. Assessing the components of the seven innovation pillars used by WIPO to develop the annual GIIs shows that a number of the components cannot be improved over the short term. Hence, they will have limited effect on improving the innovation potential of a particular industry. In other words, there is a need to drill down into the data and identify areas for focus to improve innovation potential in both short and medium terms. Simply focussing on the components and pillars that will have the most significant impact on improving the GII is a fool's errand as it may have a limited impact on innovation output. The paper explore the GII rankings at the component level of each of the ten economies: one is developed, six are developing, and three are least developed, according to United Nations criteria. Some components can only be improved at the government level, whilst others can be improved at the industry level. Strategies will then be presented on how industries can improve their innovation potential and hence improve the nation's potential.