The impacts of democracy on innovation: Revisited evidence

Abstract This research empirically tests the Popper hypothesis (2012) by utilizing panel data that cover 132 countries over the time period 1980–2017 and via panel GMM estimation in order to investigate the causal link from democracy to innovation, which is captured by two comprehensive variables, patent application and trademark application. Aside from the relationship between democracy and innovation, we further explore whether or not the change of democracy significantly influences innovation, whether the influence of democracy on innovation varies among different kinds of democracy or autocracy, and hence pay more attention on factors such as economic development level, economic performance, globalization, and international trade, and how do they change the democracy's impact on technical innovation. To confirm credibility, we carry out the robustness test by changing the measurement of democracy, the measurement of innovation and deleting extreme values. In summary, while democracy promotes innovation performance, autocracy generally exhibits lower technological innovation performance. This study provides evidence on the influence of democracy on innovation being affected by other factors such as those stated above.