Evaluation of the Institutional Environment’s Influence on Innovative Output of Enterprises in the National Economy

Abstract

The aim of this article is to study how institutional environment encourages or impedes innovative activity of enterprises and other subjects of the National Innovation System (NSI). NSI is defined as a system of interconnected elements such as state policy, knowledge infrastructure and institutional environment. Institutional environment is divided into eight domains (institutions managing markets and competition, legal institutions, institutions of higher education and research system, etc); expert evaluations of the institutions’ quality for 37 OECD member countries and candidates (including Russia) are correlated with the innovation output of these countries; with the help of factor analysis the weight of every institutional domain is defined. Strengths and weaknesses of institutional environment of Russia’s NSI are discussed; recommendations aimed at the improvement of its quality and therefore increasing the innovation output of enterprises are developed for every domain of institutions.