Investigating the effect of good governance on innovation in selected OPEC member countries

Innovation and entrepreneurship has been one of the main variables affecting the economic growth of developed countries. For this reason, policy makers are trying to improve the innovation environment and create a suitable ecosystem for the development of innovation. One of these variables affecting the creation of a suitable environment for innovation and then the development of innovation in different countries is the index of good governance in these countries. Hence, the aim of this study is to investigate the effect of good governance index on innovation in selected countries in the period from 2010 to 2021. Panel ARDL model has been used to estimate the model. The long-term model estimation results have shown that the good governance index has a significant and positive effect on the global innovation index in countries. Therefore, it is suggested that in the planning related to the development of innovation and entrepreneurship in the society, appropriate planning should be done to increase and improve the governance index. Also, government spending should be increased in businesses and activities that have a higher innovation potential in those activities.