Innovation as an Economic Driving Force in Australia

Australia has vitally identified the benefits of innovation in past few years. The Country is ranked among the top nations in OECD. They are currently working on developing the infrastructure of Research and Development sector of the Country as well as reinforced themselves in developing their Information and Communication technology. Thus, the Country has identified the importance of innovation and how its components can help in achieving increased economic growth. Innovation is the inventive or new ways a company or country adopt to carry out its processes in a more efficient manner. The incorporation of innovation in the processes of economic development through production or other ways lead to higher profitability and broader use of the available resources in an efficient and advanced way. Thus, the purpose of the following research is to analyze innovation as an economic driving force in Australia. For the fulfillment of this purpose, the researcher carried out a quantitative research under which 5-points Likert scale was designed that include questions relating to the various identified components of innovation as the independent variable and economic growth as the dependent variable. The survey was circulated among 219 executives that are working in different sectors of Australia to understand their opinion. The results through multi-regression model depicted that innovation and technology have a significant impact on the growth of Australian economy.


Introduction
It is considered as a universally accepted statement that innovation is one of the most significant factors of long-term economic growth (Dodgson, Hughes, Foster, & Metcalfe, 2011).More specifically, it is known that there have always been 3 most important production factors comprising land, labor, and capital, however, in recent time scholars and analyzers usually related these capabilities of producers with the informative factors (Pilat & Lee, 2001).Thus, the industries in Australia and manufacturers now believe that along with the 3 production factors the information or innovation factor also play a very vital role in the growth of the economy (Foster, 2014).Consequently, it is now been suggested that the traditional production factors should be utilized with the benefits of information and innovation factor by the manufacturers.Looking closely into the matter reveals that the traditional production factors; land, labor, and capital cannot alone assist in achieving long-term competitive sustainability.Most of the natural resources are not consistent enough to be reused or renewed and after a period of time, they become exhausted.Perhaps, the incorporation of innovation in production can open new opportunities and provide long-term sustainability and profitability to the businesses as well as the economy of Australia (Wong, Ho, & Autio, 2005).

Purpose
The purpose of the following study is to analyze the key elements of innovation that work as the economic driving force in Australia.

Research Questions
3. Does skilled labor factor and productivity significantly affect the growth of the economy in Australia?4. Do Information and Communication Technology have an impact on the economy of Australia? 5. Do Research and Development (R&D) cause a significant impact on the growth of the economy of Australia?

Outline
The following study has five chapters in total.The first chapter discusses the fundamental objective of conducting the following study that is to find out the elements of innovation that assist in economic growth in Australia.The second chapter focuses on providing insight of formally surveyed literature on the following subject matter.The third chapter discloses all the methods utilized in collecting data, analyzing and completing the research.Further chapter four talks about the key findings and results of the analysis.The final chapter five will provide concluding statements, implications, and recommendations based on the results of the overall research.

Understanding Innovation
Innovation in the Economic sector as explained by (Eggink & Elizabeth, 2011) is the creation and implementation of new techniques, new ways of producing and utilizing consumer goods, developing the manufacturing process in a way that delivers increased efficiency and productivity.According to Rosenberg (2004), innovation is the invention efforts of an organization to produce highly efficient ways of carrying out the production and other facilities.However, Roberts (2007) argues that every invention cannot be acclaimed as innovation.Rather they are those inventions that deliver a profit or simply innovation is the implementation of those ideas that yield revenue in return for the organization (Black & Lynch, 2004).

Open Innovation
Academically, Open Innovation can be an efficient approach augmenting the organizational performance through the implementation of Innovation and technology.Organizational features, such as flexibility or a brief hierarchy, may signify their opportunities with the application of Open innovation.With the implementation of opening organizational boundaries, these businesses can access the essential harmonizing resources to deal with their scarce research and development (R&D) capability or encompass end-users in their innovation procedure to cultivate marketing associated competence (Muzamil Naqshbandi & Kaur, 2014).
Nevertheless, assuming scarcity of resources for any organization it is not as simple to execute open innovation as it may seem.Additionally, unsettling to the heterogeneity of open innovation, verdicts concerning to its implementation are a greater challenge yet an immense opportunity though organizations nowadays tend to focus more on this field.Open innovation is a model that undertakes an organization's effort towards utilizing their external concepts and internal notions, along with their internal and external routes to market, while incorporating developed research and technology (Marcet, 2008).Through open innovation, according to (Naqshbandi & Naqshbandi, 2016) organizations, nowadays, are utilizing approaches with respects to information flows.Being very comprehensive, along with open innovation's novelty, subsidizes extreme focus on the ways to use it for processes.As (Enkel, Gassmann, & Chesbrough, 2009) argue that the vagueness with the usage further constrains the structure of a comprehensible form of sustainability.

Relationship of Innovation with Economic Growth in Australia
The study by Bassanini, Scarpetta, & Visco (2000) revealed that innovation has a highly significant impact on driving the economic performance of Australia.The Country has adopted multifactor productivity (MFP) through which the industries are able to deliver higher proficiency in the use of labor and capital (Gretton, Gali, & Parham, 2004).Moreover, the implementation of Multifactor productivity (MFP) has been successful in developing the economy with the help of enhanced managerial practices, restructuring of the organization and, most significantly, to smarter and increased use of innovative ways in the process of manufacturing finished goods (Quiggin, 2001).Thus, explaining that innovation has a vital impact on the economic development that is why Australia is investing in improving its innovative techniques in production.
On the other hand, (Parham, Roberts, & Sun, 2001) explains the relationship between innovation and economic growth by comprehending that the implementation of innovation capabilities has played a vital part in the growth dynamics and prosperity of the economy of Australia.The country has recognized that innovation is not merely relating to the utilization of technologies rather it has to be constructed early in the growth process with an aim to retain the learning capabilities and increase in overall productivity.(Gretton, Gali, & Parham, 2004) highlighted that innovation in the Country also required addressing other economic challenges precisely in the local contexts, for instance, increasing literacy rate, eliminating diseases, unemployment and hunger as well as initiating extensive knowledge spreading throughout the Country to sustain return on investment in a form of well-shaped, highly skilled, and economically sustainable nation.Eventually, a fruitful growth strategy has to construct widespread innovation capabilities to foster growth in the Country (Dodgson, Hughes, Foster, & Metcalfe, 2011).Colecchia (2002) explained in their study that technology is the central force nowadays for the existence of a sustainable economy and thus it is of immense significance to Australia both currently and in future.However, (Diewert & Lawrence, 2005) comprehended that Australia believes that technology has insight for the growth, application, and use of technologies and the Country believes in developing in this sector to attain long-term sustainability.Consequently, the research by (Costa, 2001) showed that growth and dispersion of new technology is the foremost source of Australia's manufacturing and economic growth, utilization, and productivity.Similarly, (Gretton, Gali, & Parham, 2004) explained that new technology ascends through change -change in prevailing technologies and change in the process technology is formed, improved or used.Improving Australia's capability to lead and acclimatize to technological change can lead to considerable national profits.

Skilled Labor and Productivity
The labor force is one of the factors of production and it is somehow identified as the most important factor.Skilled labors lead to economic growth if they are utilized in an appropriate manner.The labor force learns, uses their capabilities and shares their knowledge (KPMG, 2016).Once they learn to use a technology or innovation they will attain greater skills which will in the long-run benefit the overall economy increasing the productivity internally as well as economically.Parham ( 2004) hypothesized that if it is skilled in labor formed that, by non-decreasing slight yields, generates growth without any external reason.Khoo, McDonald, Voigt-Graf & Hugo (2007) demonstrated skilled labor delivering constant great returns on investment and extended valuable understandings into the substantial role of having a highly skilled workforce for long-term growth.Skilled workforce understands innovation and technology more efficiently thus increasing the productivity.

Information and Communication Technology (ICT)
Information and Communication Technology ICT are the most wide-ranging determinants of technologies.Australia tends to spend heavily on ICT to achieve very comprehensive impact across the Country's social, cultural, democratic, security and economic structures (Diewert & Lawrence, 2005).ICT is a highly valuable resource of innovation through which greater positive changes are achieved in the economy.Thus, researchers believe that ICT is among the most significant components of innovation that lead to major growth in the economy (Colecchia, 2002).

Research and Development (R&D)
Research and development are major driving innovation and domestic development and economic development, however, there also necessitate a greater investment of time, money, efforts and many other factors to be successful.R&D is that critical sector of an economy that delivers new techniques, and innovative ways to further carry out economic development.Nicolaides (2014) explained R&D as "innovative work commenced in a methodical source in order to upsurge the stock of technology, information, and knowledge.When companies deliver resources for R&D they expect a return on their investment (ROI).

Discussion of Key Findings
The following study sought to establish how innovation works as a driving force of Australian economy.The main purpose was to find out the components of innovation that has the significant impact towards the growth of the economy.Thus, researcher selected to examine 5 independent variables comprising Innovation, Technology, ICT, Research and Development (R&D), and Skilled Labor and Productivity to find out how innovation is developing the economy of the nation.
According to the findings of the research, it is comprehensive that the major economic driving force in Australia tends to be innovation.However, the indispensable encounter of constructing an innovation-based system is the proficient use of advanced technology throughout the distinct processes of different organizations that will add-value to economic competitiveness.Similarly, the results have also shown that technology also plays a significant role in driving the growth of the economy and so Australian organizations believe that the implementation of technology has brought noteworthy changes in the process turning the workforce more skilled and high efficient generating increased productivity in each sector examined.
though it is believed that skilled labor force and R&D causes increased changes in the development of the economy according to the review of the literature, nevertheless, this research has shown insignificancy with these factors.This can perhaps depict that the respondents trust open innovation, advanced technology along with information and communication technology more than other study factors.Future research can focus more on depicting better results for these factors.
To find this out the research developed a five-scale Likert questionnaire having 10 questions relating to the identified variables of the study and these questionnaires were randomly distributed among 219 respondents working in different organizations at various levels.The personal information of the respondents is kept completely confidential according to the demand of respondents.The responses of this survey were then tested through Multiple Regression Model of SPSS.The Durbin-Watson value of 0.970 shows that there is lesser auto-correlation among the variables of the study, however, the R-square is 14.8% indicating the level of the relationship between the independent and dependent variables.
Lastly, the ANOVA test helped in providing with the significance of each variable separately explaining that innovation with sig value of 0.004, technology sig value of 0.002 and Information and Communication technology sig value of 0.00 are the significant variables and these are accepted for the study.On the other hand, the R&D with a sig value of 0.228 and skilled labor and productivity with sig value of 0.143 are rejected in the study as they are insignificant according to the response results.The total sig value of the study is 0.00 indicating the research is significantly accepted.Thus, explaining that innovation and technology plays a significant role in the growth of Australian economy.

Implications of the Study
The study analyzing innovation as an economic driving force in Australia is useful for those who seek to learn about innovation.This is useful for researchers and future scholar in initiating future research based on this subject matter in a more globalized way.Moreover, this study is important for the economists, producers, and administration who seek understand the importance of innovation and technology towards increasing the economic system of the Country.

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Severity to control, assesses, and validate the data was faced.

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The time-frame of the overall research was limited and the quantity of accumulated was time-consuming.
• Collection of data for the research was yet another time-consuming process limiting the authors towards greater presentation.

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The lack of resources constrained the authors to attain the data and information from only the available means.

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The non-serious respondents have cause partiality or inaccuracy in the results to some extent which can be reviewed by future researchers.

Recommendations for Future Research
 The future research should further emphasize the importance of Research and Development as it is believed that R&D leads to the designing and incorporation of technology and innovation yet this research has not appropriately highlighted its importance based on the responses.
 The future research should be based on a broader spectrum developing a broader questionnaire and targeting greater sample to understand the subject matter in a more comprehensive manner.
 The future researchers may also invest more time and resources in data collection and validation processes.

Conclusion
The following research has concluded that for the economy to remain sustainable it is important that they realize the significance of innovation.The results of the study have shown that people believe that innovation and technology are the driving the growth of the economy and Australia has been able to maintain a growth rate of approximately 2.1% from past few year mainly due to their efforts towards developing and implementing innovation in the production of goods and services.Thus, Australia has also introduction multifactor production where they incorporate innovative ways and new technology with the basic factor of productions to carry out the production function in an efficient manner.So, currently, the best resource Australia has to boost its economy is innovation and technology.