THE RELATIONSHIP BETWEEN DEMOGRAPHIC FACTORS AND INNOVATION INDICATORS AMONG SELECTED HIGH POPULATED AND LOW POPULATED COUNTRIES

One way to achieve success in the competitive arena of international trade, is realizing competitive advantage in the form of lower costs of production or provision of variety of and low cost products in a country. To maintain this advantage, countries need to think of more complex longterm competitive advantages through supply of new goods and services or through the production of goods and services with higher efficiency. In both areas, the need for new innovations is essential. Economists suggest various factors that influence on the rate and type of innovation in the community and consider demographic factors as important in assessing the level of innovation. However, until now, there is no comprehensive study on the role of demographic factors on innovation indicators. Hence, this study sought to portray the role of demographic factors such as total population and the proportion of the active population to the total population on indicators of innovation in selected high and low populated countries during the period 2009-1986. Results indicate that generally, demographic factors have positive effects on innovation indicators. Despite this, in the Islamic Republic of Iran, that has higher population in comparison with lower-populated countries studied, demographic factors were not shown to impart much effect on innovation indicators.