A Study on the Relationship Between Government Regulations and Innovation Efficiency in Information and Communication Technology (ICT) Industry

Abstract

Although government regulations have a significant impact on innovation, research on the impact of government regulations on innovation efficiency has yet to be sufficiently uncovered. In this study, the effects of government regulations on innovation efficiency in ICT service industry are verified through tobit regression analysis after calculating innovation efficiency by DEA. Government policies are divided into 11 categories, and two different innovation efficiencies are calculated as the innovation process is divided into two stages: R&D efficiency and commercialization efficiency. The results prove that “regulations for small and medium-sized business” and “financial market regulation and separation of banking and commerce” have negatively effects on R&D efficiency.