Global Innovation Index 2018: China Breaks Into Top 20, US Drops Out Of Top 5

NEW YORK — The 11^th edition of the Global Innovation Index 2018 (GII), co-published by Cornell University, INSEAD, and the World Intellectual Property Organization, was released yesterday at a launch event in New York. This year’s report showed Switzerland still at the top overall, China continuing to rise, the United States slipping, and explored how countries can vary on inputs and outputs of innovation.

“The GII ranks 126 economies based on 80 indicators, ranging from intellectual property filing rates to mobile-application creation, education spending and scientific and technical publications,” according to a WIPO press release. The rankings for 2018 (with their 2017 ranking in parentheses) are:

One highlight of the GII 2018 is the rise of China to number 17 in 2018, from number 22 in 2017. This represents a significant breakthrough because China is the only middle-income country to enter the top 20 most innovative economies, WIPO Director General Francis Gurry told a press briefing in New York yesterday.

Also significant is that the United States dropped out of the GII top five to number 6 in 2018, from number 4 in 2017.

“If you look at the absolute numbers on many innovation parameters, China and the US dominate the space in a big way,” Soumitra Dutta, professor and former dean of management at Cornell University, told the GII 2018 launch event at the new Cornell Tech campus in New York. However, “this year, China, in absolute terms … exceeds the US in number of patents, number of researchers, number of publications … so in key parameters, China has overtaken the US already.”

The theme of this year’s report is “Energizing the World with Innovation,” and the launch event featured a panel discussion on important innovations in the energy sector. The launch event also included a presentation and two panel discussions on “Innovation in the Americas – challenges and opportunities for competitive growth,” with a focus on Brazil.

“Innovation is a key factor in the economic strategy … for all economies at every level throughout the world. In pursuing that strategy of course, countries need some guidance. And the objective of the Global Innovation Index is to provide that guidance by enabling countries to benchmark their performance in innovation against the performance of all other countries, and to see the areas in which they have … relative weaknesses and relative strengths,” WIPO’s Gurry told the press conference

before the launch event.

Input and Output

The GII rankings are calculated by averaging performance on two sub-indices of innovation input and innovation output. “The Innovation Input Sub-Index gauges elements of the national economy which embody innovative activities,” and the “Innovation Output Sub-Index captures actual evidence of innovation results,” according to the press release.

It was pointed out that Singapore is number one on inputs, but nowhere near the top on outputs. “Countries sometimes are not receiving the full reward of their innovations,” said Bruno Lanvin, executive director of global indices at INSEAD (and an IP-Watch Board member), in presenting the report.

Separately, while the United Kingdom came in at number 4, it was noted that the data do not yet include any effect of Brexit. Two-thirds of the data for this year’s report is from 2016, one-third from 2017, a speaker said.

While the GII rankings are normalized according to GDP, in order to enable comparison of economies with different levels of income, Dutta explained, there continues to be a significant correlation between level of country income and GII rank.

These disparities are reflected in the fact that the top 20 most innovative economies are “still quite Euro-focused,” noted Sacha Wunsch-Vincent, head of section for the Economics and Statistics Division of WIPO. Yet, he said, there is reason for optimism.

When you look into the GII data, “some countries just over-perform for their level of development, so they’re not in the top 20, they’re not in the top 30, but they do something that other countries can definitely learn from, and that will help overcome these regional imbalances,” Wunsch-Vincent said.

Lanvin further explained that “[t]here are lessons to be drawn – sometimes they need to be adapted, sometimes they need to be recreated, but there are sources of inspiration that can be taken from anywhere in the world. And, big countries can also draw lessons from smaller economies … so we have reasons to be optimistic.”

“This is not an academic report,” he said. “It is a tool for action. We want the report to inform discussions.”

The Global Innovation Index has been published annually since 2007, and “is now a leading benchmarking tool for business executives, policy makers and others seeking insight into the state of innovation around the world,” states the press release.

David Branigan graduated in May 2018 from the Studley Graduate Program in International Affairs at The New School. His research is focused at the intersection of technology, public policy and human rights.

William New contributed to this report.

 

Image Credits: David Branigan