The Influence of Innovation to Economic Growth of the Philippines

Linear modelling of the effect of Innovation to Economic Growth

1. Data Preparation

Data_MAN_201_2 <- read_excel("~/Documents/Data MAN 201 - 2.xlsx")
View(datastat1)

Error in View : object 'datastat1' not found

Patents <- Data_MAN_201_2$`Patent Grant`
GDP <- Data_MAN_201_2$`GDP (in Billions)`
Year <- Data_MAN_201_2$Year
plot(Year, Patents, type = "b", pch = 21)

plot(Year, GDP, type = "b", pch = 21)

2. Linear Modelling

newreg <- lm(GDP ~ Patents)
summary(newreg)

Call:
lm(formula = GDP ~ Patents)

Residuals:
     Min       1Q   Median       3Q      Max 
-116.200  -47.665    7.948   24.086  117.587 

Coefficients:
            Estimate Std. Error t value Pr(>|t|)    
(Intercept) 82.45247   43.79652   1.883 0.079294 .  
Patents      0.16011    0.03655   4.381 0.000537 ***
---
Signif. codes:  0 ‘***’ 0.001 ‘**’ 0.01 ‘*’ 0.05 ‘.’ 0.1 ‘ ’ 1

Residual standard error: 61.62 on 15 degrees of freedom
Multiple R-squared:  0.5613,    Adjusted R-squared:  0.532 
F-statistic: 19.19 on 1 and 15 DF,  p-value: 0.0005372

3. Test of Assumptions

library(lmtest)
plot(newreg)

dwtest(newreg)

    Durbin-Watson test

data:  newreg
DW = 0.75611, p-value = 0.0006139
alternative hypothesis: true autocorrelation is greater than 0

bptest(newreg)

    studentized Breusch-Pagan test

data:  newreg
BP = 0.041784, df = 1, p-value = 0.838