Joint Research Centre Statistical Audit of the 2015 Global Innovation Index

Conceptual and practical challenges are inevitable when trying to understand and model the fundamentals of innovation at the national level worldwide. The Global Innovation Index (GII) considers these conceptual challenges in Chapter 1 and deals with practical challenges—related to data quality and methodological choices—by grouping country-level data into 21 sub-pillars, 7 pillars, 2 sub-indices, and, f inally, an overall index. The object of this annex is to offer a detailed insight into the practical issues related to the construction of the index, analysing in-depth the statistical soundness of the calculations and assumptions made to arrive at the f inal index rankings. Notwithstanding, statistical soundness should be regarded as a necessary but not sufficient condition for a sound GII, since the correlations underpinning the majority of the statistical analyses carried out herein ‘need not necessarily represent the real inf luence of the individual indicators on the phenomenon being measured’.1 Consequently, the development of the GII must be nurtured by a dynamic iterative dialogue between the principles of statistical and conceptual soundness or, to put it another way, between the theoretical understanding of innovation and the empirical observations of the data underlying the variables. The Econometrics and Applied Statistics at the European Commission Joint Research Centre (JRC) in Ispra ANNEX 3