Innovation in SMEs as a Driver of Sustainable Economic Growth in Algeria: An Econometric Study for the Period 1999-2022
Abstract
Purpose – Innovation has become a pivotal concern for small and medium-sized enterprises (SMEs) as it plays a fundamental role in ensuring their survival and supporting their sustainable growth. This study aims to examine the impact of promoting and supporting innovation within SMEs on economic growth in Algeria during the period from 1999 to 2022. The overarching goal is to contribute to enhancing the added value of national economic output.
Design/methodology/approach – To achieve the study's objectives, the autoregressive distributed lag (ARDL) model was employed as the main methodology. This econometric model was selected because it analyzes the dynamic relationship between innovation and SME development over time, utilizing a standard time-series data set covering key economic indicators related to innovation and enterprise growth.
Findings – The empirical findings of the study revealed a statistically significant and positive long-term relationship between the innovation index and the growth of SMEs. The analysis confirmed that supporting innovation positively influences the development of SMEs and enhances their contribution to economic performance.
Originality/value – This study provides original empirical evidence on the strategic importance of innovation for SMEs in a developing economy context. Unlike previous studies, it focuses specifically on Algeria over a substantial time frame and highlights the necessity of adopting innovation as a strategic priority to foster sustainable economic growth and long-term value creation.
Keywords
References
- Abdilahi, M. H., Hassan, A. A., & Muhumed, M. M. (2017). The Impact of Innovation on Small and Medium Enterprises Performance: Empirical Evidence from Hargeisa, Somaliland. International Journal of Academic Research in Business and Social Sciences , 7 (8), 14-28. http://dx.doi.org/10.6007/IJARBSS/v7-i8/3202
- Boukemoum, M., & Ghiat, C. (2009). Technology business incubators and their role in developing creativity and innovation in small and medium enterprises - the case of Algeria. Managerial economic research , 3 (2), 42-66. https://asjp.cerist.dz/en/article/62824
- Budianto, R., Praptapa, A., Herwiyanti, E., Puji, P., Suyono, E., & Rusmana, O. (2022). Technological innovation in Small and Medium Enterprises: A bibliometric analysis. Journal of Sustainable Tourism and Entrepreneurship (JoSTE) , 4 (1), 55-69. https://doi.org/10.35912/joste.v4i1.1707
- Chesbrough, H. W. (2006). Open Innovation: The New Imperative for Creating and Profiting from Technology. Boston: Harvard Business Press.
- Cui, F., & Song, J.-h. (2022). Impact of Entrepreneurship on Innovation Performance of Chinese SMEs: Focusing on the Mediating Effect of Enterprise Dynamic Capability and Organizational Innovation Environment. Sustainability , 14, 1-17. https://doi.org/10.3390/su141912063
- Dickey, D. A., & Fuller, W. A. (1979). Distribution of the Estimators for Autoregressive Time Series With a Unit Root. Journal of the American Statistical Association, 74 (366), 427-431. https://doi.org/10.2307/2286348
- Jarque, C. M., & Bera, A. K. (1987). A Test for Normality of Observations and Regression Residuals. International Statistical Review , 55 (2), 163-172. https://doi.org/10.2307/1403192
- Kuratko, D. F., & Hodgetts, R. M. (2004). Entrepreneurship : theory, process, practice. Ohio: Thomson South Western.
- Li, N., & Abdullah, M. Y. (2024). Innovation and Risk-Taking in Small and Medium Enterprises (SMEs): How Cultural and Environmental Factors Influence Business Growth in China. Uniglobal Journal of Social Sciences and Humanities , 3 (2), 376-386. https://doi.org/10.53797/ujssh.v3i2.40.2024
- Mustafa, B. (2006). Knowledge and technological innovation and their role in stimulating economic growth. Economic studies , 6 (1), 65-79. https://asjp.cerist.dz/en/article/135264
- Ramsey, J. B. (1969). Tests for Specification Errors in Classical Linear Least-Squares Regression Analysis. Journal of the Royal Statistical Society , 31 (2), 350-371. https://www.jstor.org/stable/2984219
- Romer, P. M. (1990). Human capital and growth: Theory and evidence. Carnegie-Rochester Conference Series on Public Policy , 32, 251-286. https://doi.org/10.1016/0167-2231(90)90028-J
- Schumpeter, J. A. (2021). The Theory of Economic Development (1st Edition ed.). London: Routledge. Webster, M. (n.d.). innovation definition & meaning. Retrieved July 25, 2025, from Merriam Webster: https://www.merriam-webster.com/dictionary/innovation
Cezayir'de Sürdürülebilir Ekonomik Büyümenin Sürücüsü Olarak KOBİ'lerde İnovasyon: 1999-2022 Dönemi İçin Ekonometrik Bir Çalışma
Abstract
Amaç – İnovasyon, küçük ve orta ölçekli işletmelerin (KOBİ) hayatta kalmalarını ve sürdürülebilir büyümelerini desteklemelerinde temel bir rol oynadığı için onlar için temel bir ilgi alanı haline gelmiştir. Bu çalışma, 1999-2022 döneminde Cezayir'de KOBİ'lerde inovasyonun teşvik edilmesi ve desteklenmesinin ekonomik büyüme üzerindeki etkisini incelemeyi amaçlamaktadır. Genel amaç, ulusal ekonomik çıktının katma değerinin artırılmasına katkıda bulunmaktır.
Tasarım/veri/metodoloji – Çalışmanın hedeflerine ulaşmak için, ana metodolojik yaklaşım olarak otoregresif dağıtılmış gecikmeli model (ARDL) kullanılmıştır. Bu ekonometrik model, inovasyon ve KOBİ'lerin zaman içindeki gelişimi arasındaki dinamik ilişkiyi analiz etmek için seçilmiştir. Bu model, inovasyon ve işletme büyümesiyle ilgili temel ekonomik göstergeleri kapsayan standart bir zaman serisi veri seti kullanmıştır.
Bulgular – Çalışmanın ampirik bulguları, inovasyon endeksi ile KOBİ'lerin büyümesi arasında istatistiksel olarak anlamlı ve pozitif bir uzun vadeli ilişki olduğunu ortaya koymuştur. Analiz, inovasyonu desteklemenin KOBİ'lerin gelişimini olumlu yönde etkilediğini ve ekonomik performansa katkılarını artırdığını doğrulamıştır.
Özgünlük/değer – Bu çalışma, gelişmekte olan bir ekonomi bağlamında KOBİ'ler için inovasyonun stratejik önemine dair orijinal ampirik kanıtlar sunmaktadır. Önceki çalışmalardan farklı olarak, uzun bir zaman diliminde Cezayir'e odaklanmakta ve sürdürülebilir ekonomik büyümeyi ve uzun vadeli değer yaratımını teşvik etmek için inovasyonu stratejik bir öncelik olarak benimsemenin gerekliliğini vurgulamaktadır.
Keywords
References
- Abdilahi, M. H., Hassan, A. A., & Muhumed, M. M. (2017). The Impact of Innovation on Small and Medium Enterprises Performance: Empirical Evidence from Hargeisa, Somaliland. International Journal of Academic Research in Business and Social Sciences , 7 (8), 14-28. http://dx.doi.org/10.6007/IJARBSS/v7-i8/3202
- Boukemoum, M., & Ghiat, C. (2009). Technology business incubators and their role in developing creativity and innovation in small and medium enterprises - the case of Algeria. Managerial economic research , 3 (2), 42-66. https://asjp.cerist.dz/en/article/62824
- Budianto, R., Praptapa, A., Herwiyanti, E., Puji, P., Suyono, E., & Rusmana, O. (2022). Technological innovation in Small and Medium Enterprises: A bibliometric analysis. Journal of Sustainable Tourism and Entrepreneurship (JoSTE) , 4 (1), 55-69. https://doi.org/10.35912/joste.v4i1.1707
- Chesbrough, H. W. (2006). Open Innovation: The New Imperative for Creating and Profiting from Technology. Boston: Harvard Business Press.
- Cui, F., & Song, J.-h. (2022). Impact of Entrepreneurship on Innovation Performance of Chinese SMEs: Focusing on the Mediating Effect of Enterprise Dynamic Capability and Organizational Innovation Environment. Sustainability , 14, 1-17. https://doi.org/10.3390/su141912063
- Dickey, D. A., & Fuller, W. A. (1979). Distribution of the Estimators for Autoregressive Time Series With a Unit Root. Journal of the American Statistical Association, 74 (366), 427-431. https://doi.org/10.2307/2286348
- Jarque, C. M., & Bera, A. K. (1987). A Test for Normality of Observations and Regression Residuals. International Statistical Review , 55 (2), 163-172. https://doi.org/10.2307/1403192
- Kuratko, D. F., & Hodgetts, R. M. (2004). Entrepreneurship : theory, process, practice. Ohio: Thomson South Western.
- Li, N., & Abdullah, M. Y. (2024). Innovation and Risk-Taking in Small and Medium Enterprises (SMEs): How Cultural and Environmental Factors Influence Business Growth in China. Uniglobal Journal of Social Sciences and Humanities , 3 (2), 376-386. https://doi.org/10.53797/ujssh.v3i2.40.2024
- Mustafa, B. (2006). Knowledge and technological innovation and their role in stimulating economic growth. Economic studies , 6 (1), 65-79. https://asjp.cerist.dz/en/article/135264
- Ramsey, J. B. (1969). Tests for Specification Errors in Classical Linear Least-Squares Regression Analysis. Journal of the Royal Statistical Society , 31 (2), 350-371. https://www.jstor.org/stable/2984219
- Romer, P. M. (1990). Human capital and growth: Theory and evidence. Carnegie-Rochester Conference Series on Public Policy , 32, 251-286. https://doi.org/10.1016/0167-2231(90)90028-J
- Schumpeter, J. A. (2021). The Theory of Economic Development (1st Edition ed.). London: Routledge. Webster, M. (n.d.). innovation definition & meaning. Retrieved July 25, 2025, from Merriam Webster: https://www.merriam-webster.com/dictionary/innovation
Details
| Primary Language | English |
|---|---|
| Subjects | Macroeconomics (Other), Sustainable Development |
| Journal Section | Research Article |
| Authors | |
| Submission Date | August 23, 2025 |
| Acceptance Date | December 15, 2025 |
| Publication Date | December 30, 2025 |
| Published in Issue | Year 2025 Volume: 3 Issue: 2 |