Motivating business towards innovation: A panel data study using dynamic capability framework

Abstract National strategic dynamic capabilities refer to the nations' ability to acquire, develop, and transfer national resources into innovation. This would help provoke firms and individuals’ capabilities to sense and seize to expedite innovative performance transformation. This study suggests that through the dynamic capabilities (DC) framework, the government can increase Innovation by channelizing the economic innovation system indicators. Macroeconomic indicators from 62 countries were taken to assess the significance of indicator-based dynamic capabilities model. The results confirm that sensing and seizing indices motivate Innovation, while the cost of business negatively moderates sensing. This model suggests that governments can motivate Innovation by exploring the indicators which are determining the sensing and seizing environment of decision-makers in businesses.