Search Results for arab-economies

Abstract

This research aims to analyze the asymmetric impact of the Global Innovation Index (GII) on Gross Domestic Product (GDP) growth in South Korea over the period (2004–2024). It further explores the potential for adapting this experience within the economies of Iraq, Egypt, and Jordan. Utilizing a Nonlinear Autoregressive Distributed Lag (NARDL) model, the study examines the dynamics of this relationship in both the short and long runs. The empirical findings reveal a nonlinear cointegration relationship, indicating that the South Korean economy exhibits hyper-sensitivity toward negative innovation shocks. Specifically, a 1% negative shock in innovation leads to a growth contraction of approximately 1.65%, whereas the growth response to positive shocks does not exceed 0.33%. Furthermore, CUSUM and CUSUMQ tests confirmed the structural stability of the model over two decades. The research concludes that the innovation gap in the studied Arab countries necessitates policies that support innovation budgets to ensure the stability of structural growth parameters, independent of fluctuations in traditional sectors.