Productivity of R&D institution: The case of Indonesia

•We analyzed the performance of Indonesian R&D institutions based on R&D productivity.•We applied an institutional approach and considered the effect of collective determinants.•National innovation system in the developing countries with different model from that in the developed countries.•The non-economic dimension is an essential factor in development of national innovation system in developing countries.

This study analyzes the performance of Indonesian R&D institutions based on R&D productivity. By applying an institutional approach, the effects of collective determinants such as quality of researcher, R&D budgets, locations and ages of R&D institutions on productivity are considered. Our findings show that these performance variables had strong and significant effects on R&D productivity. A national innovation system should be developed in developing countries with different models from those used in developed countries. The non-economic dimension is essential in developing national innovation systems in developing countries such as Indonesia.