A statistical method for analyzing data from National systems of innovation surveys

Abstract

A National System of Innovation (NSI) represents the strength and quality of the systematically organized interactions and linkages between Government, Knowledge-Based Institutions (KBIs), Industry and Financial Arbitrageurs. A comprehensive understanding of the factors that affect innovation in the NSI would be crucial in enhancing and promoting innovation as a development asset. The purpose of this paper is to identify the latent factors affecting innovation in NSI. Data used was from Ghana National System of Innovation Survey conducted in 2012.Exploratory factor analysis with principal component analysis extraction method and varimax rotation was used. The analysis produced four latent factors; Poor Human Capital, Regulatory Indiscipline, Undemanding Markets and Regulatory Risks.