The Impact of Entrepreneurship Financial Opportunities and Business Environment on the Country’s Innovation Development and National Wealth

Abstract

The Covid-19 pandemic caused negative consequences for the economic growth and national wealth of countries worldwide. In 2020 the GDP per capita growth was -4,3% worldwide and -5% in Azerbaijan. However, in 2021, it was 4,8% and 5,1% in accordance, indicating Azerbaijan’s economic potential. At the same time, Azerbaijan takes only 80th place from 132 countries in the Global Innovation Index Rank, which is not sufficient and requires further innovation development of the country. Also, Azerbaijan is the 34th of 190 countries in the Ease of Doing Business rank. Still, according to the Enterprise Surveys made by the World Bank, 23,7% of firms in Azerbaijan choose access to finance as their biggest obstacle. At the same time, the average world indicator is 14,2%, and the average one in Europe and Central Asia is 9,4%. Therefore, this research aims to prove the hypothesis about the positive impact of entrepreneurship financial opportunities and the business environment on the country’s innovation development and national wealth. In the first stage, a bibliometric and analytical analysis was carried out using the tools of the Scopus database, the VOSviewer, and Google Trends. In the second stage, a sample of 20 countries was formed. It includes the top 10 leaders in the Global Innovation Index Rank with high-income economies (as benchmark countries for innovation development, according to which Azerbaijan should increase its position) and the top 10 leaders with upper-middle-income economies (similar to Azerbaijan). The informational base consists of data from the World Bank, the World Intellectual Property Organization, and the World Economic Forum for the last 10 available years. In the third stage, the correlation analysis was made to identify the relationship between the indicators of entrepreneurship financial opportunities and business environment (financing of SMEs, venture capital availability, domestic credit to the private sector, ease of doing business, ease of starting a business, ease of getting credit, ease of resolving insolvency, protecting minority investors, number of new limited liability companies, new business density) and the indicators of the country’s innovation development (Global Innovation Index) and national wealth (total wealth per capita). And at the fourth stage, the impact of entrepreneurship financial opportunities and business environment on the country’s innovation development and national wealth was determined based on regression modeling results. The obtained results could be useful for scientists in further research on this issue and for government officials in improving the state’s economic policy.