n the 2017 Bloomberg Innovation Index, the top five countries are South Korea, Sweden, Germany, Switzerland and Finland.

The 7 factors Bloomberg uses to compile its index are research and development (R&D) intensity, value-added manufacturing, productivity, high-tech density, tertiary efficiency, researcher concentration and patent activity. The term ‘innovation economy’ has been around since Joseph Schumpeter the idea in his 1942 book Capitalism, Socialism and Democracy. In the book he posited that evolving institutions, entrepreneurship and technological breakthroughs are at the heart of economic growth. Innovation economy is now a mainstream concept.

South Korea

South Korea’s top ranking was down to it topping the charts in R&D intensity, value-added manufacturing and patent activity and had top-five rankings in high-tech density, higher education and researcher concentration. Its commitment to fostering research and development in various fields is seen as second to none.

Sweden

Sweden has also gone large with its R&D spending. It has focused on medicine, bioscience, technology and climate research. Government funding for small firms in particular has made a difference to innovative approaches, companies are taking more risks these days. Lindholm Dahlstrand, professor in innovation studies at Lund University in Sweden said “There’s a lot of focus on R&D in Sweden. We’ve seen what’s happened in a lot of other countries where they didn’t do it.”

Germany

According to the Goethe Institute Germany has allocated €80 billion for research and development. This makes it the second biggest global investor in R&D behind the USA. The Federal Ministry of Education and Research, says “the goal is for good ideas to be translated quickly into innovative products and services. This is because innovative solutions are the factors that drive our prosperity and support our quality of life.”

Switzerland

Switzerland has been investing heavily in innovation and information and communication technologies (ICT). It has a highly sophisticated business environment. Each year 70% of Swiss youths enhance their employability by joining apprenticeship programmes offered by corporations where they learn at an early age that change and disruption are essential to keep things moving forward.

Finland

In Finland the Research and Innovation Council is chaired by the Prime Minister. The council is responsible for the formulation of all Finnish science, technology and innovation policies. IBM and GE Healthcare have recently set up Centres of Excellence in Finland. The Finnish Funding Agency for Innovation (Tekes) has worked hard to foster an environment where innovation is cultivated through development platforms and mentoring programmes.

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