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A Sobering Look at American Competitiveness

Mark Marich

America’s competitiveness challenges are not simply an outgrowth of the current economic crisis. Instead, they are the culmination of decades without a coherent national innovation strategy. That’s the primary message of a new Information Technology and Innovation Foundation (ITIF) report that benchmarks American innovation performance against that of other leading developed economies.

In most of these ranking exercises, the US tends to rank at or near the top. ITIF ranks the US sixth on a basket of key innovation-related measures, behind Singapore, Sweden, Luxembourg, Denmark and South  Korea.

Even more sobering, the US ranks quite low when looking the trends in key performance measures. When tracking performance over a ten-year period (1999-2009), the US ranks last when compared to 35 other economies in terms of improving its innovation performance. While US performance has improved slightly, other economies have made major investments and introduced significant reforms to improve their innovation economies. If the US fails to get serious about a national innovation policy, the gap will continue to close and US performance will continue to lag.

So what would an effective national innovation policy look like? ITIF recommends five key actions:

  • Put in place incentives for firms to innovate within their borders.
  • Be open to high-skill immigration.
  • Foster a digital economy.
  • Support the kinds of institutions that are critical to innovation.
  • Ensure that regulations and other related government policies support, not retard, innovation

 Report: 'The Atlantic Century: Benchmarking EU and US Innovation and Competitiveness' by Robert Atkinson and Scott Andes.

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