Business Sector Investment in R&D as a Factor for Improving Innovation - Evidence from Hungary, Romania, Bulgaria, and Serbia

ABSTRACT

The purpose of this paper is to investigate whether a country’s innovative capacity increases when the business sector invests more in research and development. The empirical investigation covers Serbia and its three neighboring countries in the European Union – Hungary, Romania, and Bulgaria – for the period from 2011 to 2021. The results indicate that an increase in investment by the business sector at the current level of GDP influences the increase in innovation in the case of Serbia, Hungary, and Bulgaria.

KEYWORDS:

• Business sector
• GDP
• innovation
• investment
• R&D

JEL CLASSIFICATION:

• O3
• E22

Acknowledgments

The research presented in this paper was funded by the Ministry of Science, Technological Development and Innovation of the Republic of Serbia under contract number 451-03-47/2023-01/200005.

Disclosure statement

No potential conflict of interest was reported by the author(s).

Additional information

Notes on contributors

Ivana Domazet

Ivana Domazet is a Principal Research Fellow at the Institute of Economic Sciences, Belgrade. Her scientific interests are primarily in the field of digital business and focused on the economic effects of the digitalization of the business environment and labor market. She is an expert in ICT in business and higher education, and national competitiveness. Has an extensive scientific portfolio (157 publications during her career) and was a principal investigator of several international projects related to digital transformation. She is a member of the Scientific Committee for Economics, Law and Political Science of the Republic of Serbia; Professor at Belgrade Banking Academy – Faculty for banking, insurance and finance at master teaching courses: IT in Business; Digital Marketing and Integrated Marketing Communications and doctoral studies (Marketing in Finance) and mentor of 4 doctoral theses and 19 final masters at papers at Belgrade Banking Academy – Faculty for banking, insurance and finance.

Darko Marjanović

Darko Marjanović is a Senior Research Associate at the Institute of Economic Sciences. He completed his graduate, master, and doctoral studies at the Faculty of Economics in Subotica, University of Novi Sad. He served as a financial director (CFO) in a large trading company BB Trade ad from 2015 to 2018. His current areas of professional interest are public finance, competitiveness, and foreign direct investment. He has published, as author or co-author more than 60 scientific papers. He has participated in a few international projects, as well as several research and scientific projects, financed by the Ministry of Education, Science, and Technological Development of the Republic of Serbia and the Provincial Secretariat for Science and Technological Development of the Autonomous Province of Vojvodina. He is a member of the Scientific Board at the Institute of Economic Sciences and associate member of the Scientific Society of Economists of Serbia. He was a Vice President of the Scientific Board at the Institute of Economic Sciences, head of the Center for Strategic Cooperation, coordinator of the Macroeconomics Department and editor-in-chief of the international publication SEE-6 Economic Outlook.

Deniz Ahmetagić

Deniz Ahmetagić works at the Faculty of Economics in Subotica, as Expert Associate in Science. He completed his graduate, master, and doctoral studies at the Faculty of Economics in Subotica, University of Novi Sad. He has participated in the development of project proposals and project management activity for projects funded by the programs of the European Commission, TEMPUS, SEE IPA and others. He also managed national projects funded by the Provincial Secretariat for Science and Technological Development, the Republic of Serbia, the Ministry of Education Science and Technological Development, and others. Deniz has published as an author or co-author of more than 30 articles in management and finance.

Milica Bugarčić

Milica Bugarčić is Assistant professor at Belgrade banking academy - Faculty for banking, insurance and finance. She teaches Microeconomics, Financial Statistics and Data Analysis at undergraduate studies, Marketing Research, Economic Analysis and Advanced Data Analysis at postgraduate studies. Her scientific interests refer to demand analysis and marketing research. She published as author or co-author more than 15 articles. From 2020 she has been engaged as an external associate of the Institute of Economic Sciences and is an active member of the Serbian Marketing Association.

Vladimir Simović

Vladimir Simović is a Head of the Digital Economy Department at the Institute of Economic Sciences, Belgrade Serbia, and a Research Fellow in the Scientific Research Center at the Australian University in Kuwait. His research interests are digital entrepreneurial competencies, relevant competence frameworks and assessment tools. He is a PI in two research projects funded by Kuwait Foundation for the Advancement in Sciences (KFAS) dedicated to digital entrepreneurial competence assessment for university students and remote work capacity building. Also, he is an Associate professor in digital entrepreneurship, digital marketing and CRM.