ISSUES OF THE IMPACT OF INNOVATIONS ON THE ECONOMY

Аннотация

This article thoroughly analyzes aspects of innovation as an important driving force of economic growth using examples from foreign experiences, highlighting how innovations can create new industries, increase employment levels, attract foreign investment, and serve as an important factor in achieving competitive advantage in the market by ensuring product quality competitiveness. Keywords: Innovation, globalization, competitiveness, efficiency, microeconomic, innovation zone,technopark, R&D,patent, startup incubators, Innovations are an important driving force of modern economic development. They not only create new products and services, but also accelerate economic growth by improving existing production processes, efficient use of resources, and increasing labor productivity. Thanks to innovative activity, enterprises produce products with high added value and increase competitiveness in domestic and foreign markets. The experience of developed countries shows that high economic efficiency can be achieved by investing in science and technology, supporting research and development. Thus, innovations, as the main factor of economic growth, play a decisiverole in ensuring sustainabledevelopment and competitiveness. Innovations are one of the main factors of economic growth. This effect can be seen in the followingdirections: 1.Increasing laborproductivity 2.Creation ofnew jobs and industries 3.Attraction offoreign investments 4.Improvement ofthe qualityof products and services Innovations, as an important driving force of economic growth, have a direct impact on the development of society. The above-mentioned areas - increasing labor productivity, the formation of new jobs and industries, attracting foreign investment, and improving the quality of products and services - are the result of innovative activity and strengthen the country's competitiveness. Therefore, the development of innovation as a strategic direction, with constant attention to it, is themain guaranteeofensuring economic stabilityand long-term growth[1]. Innovations lead to significant positive changes at the firm level. At the microeconomic level, thatis, at the enterprise orfirm level, innovativeactivityprovides thefollowing main advantages: With the help of innovative technologies, automated equipment, and digital management systems, production efficiency is increased and the consumption of excess resources is reduced. For example, through modern ERP (Enterprise Resource Planning) systems, production, supply, and page1506 INTERNATIONAL JOURNAL OF ARTIFICIAL INTELLIGENCE ISSN:2692-5206,ImpactFactor:12,23 AmericanAcademicpublishers,volume05,issue04,2025 Journal: https://www.academicpublishers.org/journals/index.php/ijai procurement processes will be fully digitized, which will reduce errors and time losses caused by the human factor. As a result, the cost of production decreases, and profit increases. For example, the introduction of automated sewing machines at large textile enterprises in Uzbekistan has significantlyreduced laborcosts[2]. Through innovation, firms improve their products or services in the market. This gives an advantage over competitors. For example, mobile phone manufacturers annually introduce new technologies, increasing the competitiveness of their brands. Thus, Apple maintains its leadership in the competition in the premium segment by implementing advanced camera and security systems oniPhonemodels. As a result of innovations, the quality of the offered products increases, and services that meet new needs appear. This leads to an increase in the number ofbuyers, thus expanding market share. For example, Netflix created an innovative online film platform and took a leading position in the global market as an alternative to traditional television. Innovations allow firms to develop new types of products. New products, especially those that are rare in the market or satisfy a completely new need, have ahigh margin. For example, bybringing electric cars to the market, Tesla not only met the need for environmentally friendly vehicles, but also significantly increased its revenue. Today, innovative development is considered not only as economic growth, but also as an important pillar of national security, competitiveness, social well-being, and state independence. Therefore, supporting, protecting, and stimulating innovative activity is one of the priorities of political strategy in most developed countries. The following approaches are prime examples of this:[3] •Financingof research anddevelopment The state provides financial support for research and development (R&D) to achieve innovative progress. For example, in Germany, there is a system that acts as a bridge between industry and scientific research through the network of "Fraunhofer" institutes. In the USA, the National Science Foundation (NSF) allocates billions of dollars annually to scientific and technological projects. In Uzbekistan, in recent years, grants