Discussion Paper No. 273 of 2021 on Assessing the Efficiency of National Innovation Systems in Selected African Countries

Abstract

Innovation systems in African countries are largely characterized by low levels of science and technological activities, reliance on government or foreign donor funding, and weak industry linkages. Several efforts have been made by the African Union and national governments to support innovation in the region, yet the region still ranks low in terms of innovation performance. This study examines the efficiency of selected African National Innovation Systems and the drivers of efficiency, since innovation performance is affected not only by availability of resources, but also their efficient utilization. Secondary data retrieved from different sources, including UNESCO Institute of Statistics, Ibrahim Index of Governance, World Bank Development Indicators and African Economic Outlook was used in the study. Thirty (30) African countries were selected as the decision-making Units (DMUs). Bootstrap Data Envelopment Analysis was used to generate efficiency scores for each country, and Tobit regression to determine the drivers of efficiency. The results indicate that the selected countries are, on average, 54.2 per cent efficient, with Mauritius, Rwanda and Cote d’ Ivoire being the best performers. Further, the selected countries were found to spend an average of 0.383 per cent of their GDP on Research and Development (R&D), which was way below the target of 1 per cent set by the African Union. It was observed that 4.4 per cent of the manufactured exports are high technology exports, which is quite low. On the drivers of efficiency, the Tobit results reveal that efficiency scores of the selected countries can be improved through three variables: Education, ICT infrastructure and increased labour force.