Thematics

International comparison - Global Innovation Scoreboard

The “Global Innovation Scoreboard” report (GIS)1 compares the innovation performance of the EU25 to that of the other major R&D spenders and emerging economies in the world: Argentina, Australia, Brazil, Canada, China, Hong Kong, India, Israel, Japan, New Zealand, Republic of Korea, Mexico, Russian Federation, Singapore, South Africa and the US.
Of the 25 indicators used to measure innovation performance in the European Innovation Scoreboard (EIS), GIS data were available for 12 of them. Innovation performance is measured by use of a composite indicator, the Global Summary Innovation Index (GSII) decomposed into 5 composite indices measuring 5 key innovation dimensions: Innovation drivers, Knowledge creation, Diffusion, Applications and Intellectual property. Overall data availability for all countries is as high as 97% in the reference year and 90% in the base year. For South Africa, India, Malta and Croatia data availability was poorest.
Based on the ranking of their GSII scores, the countries analysed can be divided into four groups:

• Finland, Sweden, Switzerland, Japan, the US, Singapore and Israel are the global innovation leaders.
• The group of next-best performers includes Germany, Denmark, Netherlands, Canada, the UK, Republic of Korea, France, Iceland, Norway, Belgium, Australia, Austria, Ireland, Luxembourg and New Zealand.
• The group of follower countries includes the Hong Kong, Russian Federation, Slovenia, Italy, Spain, Czech Republic, Croatia, Estonia, Hungary and Malta.
• The group of lagging countries includes Lithuania, Greece, China, Slovakia, South Africa, Portugal, Bulgaria, Turkey, Brazil, Latvia, Mexico, Poland, Argentina, India, Cyprus and Romania.

Cluster analysis using the composite indices for the 5 key innovation dimensions is a more powerful tool for identifying countries with similar performance than the ranking based on the Global Summary Innovation Index (GSII). The GSII can give two countries identical global ratings even if their behaviour in the five composite indices is very different. Based on their absolute scores on the 5 innovation dimensions, the countries can be clustered into 5 performance clusters.

Another option for clustering is to compare relative performance across the five dimensions, so as to identify countries with similar patterns of innovation performance. Absolute differences in performance between countries are excluded and inter-country differences are entirely due to the relative differences in strengths and weaknesses across each dimension. The purpose of a clustering on relative performance is to identify countries that share similar patterns of innovation strengths and weaknesses. This information could assist the policy community in identifying better performing countries with similar patterns. Based on their relative or normalised scores on the 5 innovation dimensions, the countries can be clustered into 6 pattern clusters where countries are comparable in their relative performance structure.

By combining cluster membership based on both absolute and relative performance we can identify 3 clusters including 6 or more countries and 5 mini-clusters including only 2 or 3 countries:

• Japan, Germany, Switzerland, Finland, Sweden and Israel are alike both in their absolute performance and relative performance levels. These countries can be classified as the absolute innovation leaders from which all other countries can learn to improve their innovation performance.
• Austria, Belgium, France, Denmark, Republic of Korea, Norway, Australia, UK, Canada and Netherlands are alike in relative performance to the innovation leaders, but they lag behind in absolute performance.
• Estonia, Slovenia, Czech Republic, Hungary, Croatia and Hong Kong attain similar levels in their absolute and relative innovation performance. These countries are far behind the innovation leaders, their different relative performance structure might be one explanation for this performance lag.

The mini-clusters combine either different groups of European countries (Slovakia, Poland and Portugal; Greece, Lithuania and Bulgaria; Spain and Russian Federation) or Latin American (Argentina and Brazil) or Asian countries (India and China).
Of the non-EIS countries, Israel, Republic of Korea, Australia and Canada are similar to the average performing EU countries. Hong Kong is classified within the better performing new Eastern European Member States and the Russian Federation is classified together with Spain. Neither Argentina and Brazil nor India and China are comparable to any of the better performing EU countries in either absolute or relative performance levels. It would seem that in these countries a substantial improvement in their innovation systems is still necessary to catch-up with the best performing countries.

By comparing the GSII in the most recent reference year and that in the base year, trend performance of the GSII can be compared with current performance. Of the non-EU countries, 11 countries are catching up towards the average EU level of innovation performance, 7 countries are forging ahead (Switzerland, Singapore, Canada, Republic of Korea, Iceland, Norway and Australia), 3 countries are losing momentum (Israel, Japan and the US) and Brazil is falling behind. The EU’s average innovation performance is improving at a slower rate than that of the 18 non-EU countries. Although the average innovation performance of the EU is growing faster than that of three non-European leading countries: Israel, Japan and the US, the EU is still facing a large gap in innovation performance with these countries.

The cluster analysis performed suggests that for most of the EU countries there are only limited learning possibilities to improve their innovation performance from countries such as Argentina, Brazil, India and China. For several of the better performing new Member States it might be worth studying the innovation system of Hong Kong. For some of the better performing EU countries the Republic of Korea, Australia and Canada could be relevant peer countries to learn from. For the best performing EU countries, Japan, Switzerland, (the US) and to a lesser extent also Israel are the relevant peer countries2.