Innovation capital: A reflection on the case of the Arab countries
ADLI ABOUZEEDAN, GOTHENBURG UNIVERSITY, SWEDEN
MICHAEL BUSLER, PENNSYLVANIA STATE UNIVERSITY, USA
Economies have different levels of entrepreneurial activities depending on the availability of tangible as well as intangible resources. In their working paper, Abouzeedan and Busler (2004) have established a new type of capital, adding up the components of the most important types of capital. These are the Human Capital, the Financial Capital and the System Capital. In that paper, the two researchers have defined each of the components and explained what they meant with those terminologies. They called this new type of capital, Innovation Capital. The two researchers have argued that Innovation Capital can be used as an indicator for the degree of richness of the entrepreneurial environment in a region and thus the general character of the economy. They also introduced the Innovation Balance Matrix (IBAM) as an analytical tool to classify economies based on their entrepreneurial conditions. In this extended work, we have used their analysis and tried to run it on Arab countries using a general knowledge and deductive approach to the issue. We concluded the paper with some recommendations as how to enrich the Innovation Capital in that region.
Keywords: Human Capital; Financial Capital; System Capital; Innovation Capital; Innovation Balance Matrix; IBAM, Arab Countries; Knowledge Embedded Value; Knowledge Embedded Value Margin