X-Y scatter chart and statistics of the relationship between a nation's global innovation index in 2011 as established by INSEAD for 125 countries, and the corresponding GDP per capita. There is a strong correlation between the two variables. The correlation coefficient r = 0.85, and the R² = 0.72.

There is a clear linear association between the global innovation score and the GDP per capita for the 125 countries under consideration. The high correlation coefficient (r = 0.85) indicates a strong association. Seventy two percent of the variation of the innovation index are explained by the variation of the GDP per capita (R² = 0.72). This confirms the results of the 2009 ranking, although the sources, the methods and the panel of countries used are different.

The chart shows the logarithms of the two variables, GDP per capita on the X-axis, and the innovation score on the Y-axis. The choice of the logarithm transformation is justified by the greater simplicity of the line of fit — the red straight line —, compared to the curve that the original information would produce, and by the possibility to further understand the information behind the data by looking at the residuals.

The first evidence rendered by the chart is that high innovation indexes emerge in countries that enjoy higher GDP per capita : as the latter grows by 100 units, the innovation index climbs 16. This fact invalidates, at least partially, the popular claim that necessity is the mother of invention. In reality, you need resources to indulge into innovation — poverty is a hindrance, not a helper. However, this does not tell the full story, otherwise the data dots would coincide exactly with the straight line, which is not the case.

The analysis of residuals — a residual being the difference between the actual innovation score and the corresponding value of the line of fit — reveals that some countries endowed with comparatively high GDP per capita score low in innovation, and vice-verse. GDP per capita is not all — it explains 72% of the innovation score variation (R² = 0.72) —; some other factors must be there to explain the remaining 28%.

There is a set of countries which score higher on innovation than what their GDP per capita would entitle them to. In descending order the top ten are : China, Viet Nam, Moldova, Hong Kong, India, Sweden, Singapore, South Korea, Switzerland and Estonia. Five out of these 10 countries enjoy GDP per capita indexes that are multiples of the overall median (from 3.3 times for Korea to 10.5 for Switzerland) — they are in line with the general association between GDP and innovation. However, 5 other countries are below the median (the GDP per capita of Viet Nam is only 19% of the median, and China's is 70%). It is thus established that comparatively poor economies may succeed in achieving relatively high innovation scores. Assuming that innovation is a lever to improve economic well-being, poor countries need not lose hope — innovation is not out of reach.

At the opposite end, residuals reveal that a number of countries have an innovation performance below their GDP entitlement. The 10 lowest performers are in ascending order : Algeria, Venezuela, Brunei, Kuwait, Sudan, Greece, Yemen, Trinidad and Tobago, Syria and Kazakhstan. Six countries enjoy GDP per capita that are a multiple of the median, ranging from 1.4 times for Kazakhstan to 8.7 time for Kuwait. Four have a fraction of the median : from 17% for Yemen to 71% for Algeria. This is a mirror reflection of the situation portrayed in the last paragraph : notwithstanding enviable opportunities offered by comparatively high GDP, some countries waste their chances of attaining correct innovation indexes.

In summary, rich countries are more adept to achieve high innovation through a generous provision of education, infrastructures, administrative and political enabling environments, and financial and material support. However, The oil-rent rich countries and the largest world economies do not score impressively well. The historian Toynbee is probably right when sustaining that too much hardship crushes the ability to prosper, whilst too easy a life breeds indolence and complacency, thus preventing great achievements. Success, at least for civilizations, said Toynbee, favors those who live in a mildly hostile environment that stimulates them to reach out and accomplish prowess.

 

Global Innovation Index 2011
(Correlation of innovation with wealth)

Rank

Country

Score

GDP 2010
($US billion ¹)

Population 2011
(thousand)

GDP per capita
($US thousand)

80Albania30.4510.63,2693,248
125Algeria19.79143.636,2433,963
58Argentina35.36332.241,8197,944
69Armenia338.33,1882,618
21Australia49.85842.8 ²23,47235,908
19Austria50.75338.98,82538,404
88Azerbaijan29.1746.09,4184,888
46Bahrain37.818.8 ²1,32814,137
97Bangladesh28.0590.2151,574595
24Belgium49.05421.211,31037,238
118Benin23.816.09,134654
112Bolivia25.4417.810,1571,755
76Bosnia and Herzegovina30.8415.23,8583,944
79Botswana30.5113.42,0416,559
47Brazil37.751,881.1199,6849,420
75Brunei Darussalam30.939.8 ²40923,918
42Bulgaria38.4243.07,7445,551
120Burkina Faso23.147.916,998468
111Cambodia25.4610.214,369711
103Cameroon26.9520.220,1221,003
8Canada56.331,418.235,72239,700
38Chile38.84183.317,64510,388
29China46.435,296.41,366,9633,875
71Colombia32.32259.647,4535,472
45Costa Rica37.9131.14,7996,489
117Côte dIvoire24.0820.520,2401,014
44Croatia37.9854.84,57311,990
28Cyprus46.4522.8 ²1,14619,912
27Czech Republic47.3173.110,92515,846
6Denmark56.96279.75,80448,184
93Ecuador28.7553.114,8613,572
87Egypt29.21197.283,1332,372
90El Salvador29.1419.66,3323,101
23Estonia49.1816.81,40012,017
121Ethiopia22.8826.885,076315
5Finland57.5215.25,64438,120
22France49.252,306.566,60034,632
73Georgia31.8710.54,4732,350
12Germany54.892,981.986,45734,490
70Ghana32.4828.225,0951,124
63Greece34.18274.711,96922,948
86Guatemala29.3337.114,8782,494
61Guyana34.832.07612,629
98Honduras27.8113.97,8241,773
4Hong Kong (SAR), China58.8202.27,38727,377
25Hungary48.12117.510,37211,329
11Iceland55.111.333633,819
62India34.521,557.81,250,2321,246
99Indonesia27.78636.6244,1912,607
95Iran28.41301.7 ²75,5793,991
13Ireland54.1183.74,65639,456
14Israel54.03195.87,78425,154
35Italy40.691,848.364,45428,676
92Jamaica28.8812.62,8064,493
20Japan50.324,953.3134,88736,722
41Jordan38.4324.86,3633,904
84Kazakhstan30.32128.816,4007,855
89Kenya29.1528.341,777677
16Korea, Republic53.68914.049,42418,493
52Kuwait36.64136.3 ³2,82748,222
85Kyrgyzstan29.794.25,444764
36Latvia39.821.62,3409,243
49Lebanon37.1135.34,3118,182
40Lithuania38.4932.73,4369,519
17Luxembourg52.6549.653692,686
67Macedonia33.478.22,1093,895
113Madagascar25.417.921,414367
108Malawi25.964.615,435298
31Malaysia44.05214.329,0297,381
107Mali26.358.315,867525
53Mauritius36.478.81,3256,615
81Mexico30.45936.7116,3968,047
39Moldova, Republic38.665.23,6261,443
68Mongolia33.45.52,8191,944
94Morocco28.7382.232,5452,525
78Namibia30.7411.02,3364,693
9Netherlands56.31705.817,33140,726
15New Zealand53.79115.4 ²4,57025,261
110Nicaragua25.785.95,927996
122Niger21.415.016,093311
96Nigeria28.15174.5163,1151,070
18Norway52.6373.45,14972,519
57Oman35.5142.0 ²2,86114,690
105Pakistan26.75157.5177,836886
77Panama30.7724.13,6176,670
74Paraguay31.1716.66,6332,509
83Peru30.34138.629,7394,661
91Philippines28.98179.895,2871,887
43Poland38.02422.239,67010,642
33Portugal42.4205.911,19818,388
26Qatar47.7489.6 ²1,87247,859
50Romania36.83145.622,1406,577
56Russian Federation35.851,333.3147,1009,064
109Rwanda25.865.110,982462
54Saudi Arabia36.44342.4 ²28,25112,122
100Senegal27.5611.712,786913
55Serbia36.3135.310,1813,462
3Singapore59.64200.65,28537,961
37Slovak Republic39.0580.25,62514,261
30Slovenia45.0743.02,12220,277
59South Africa35.22327.750,7676,455
32Spain43.811,268.048,83125,968
82Sri Lanka30.3644.621,3672,089
124Sudan20.3655.944,8141,247
101Swaziland27.523.31,2082,718
2Sweden62.12412.69,94041,515
1Switzerland63.82471.98,07758,426
115Syrian Arab Republic24.8253.220,9072,547
116Tajikistan24.55.17,026723
104Tanzania26.8820.846,402448
48Thailand37.63287.370,7394,061
72Trinidad and Tobago32.1718.41,36413,475
66Tunisia33.8939.910,7253,721
65Turkey34.11662.474,3118,915
106Uganda26.3715.334,625443
60Ukraine35.01124.346,7592,658
34United Arab Emirates41.99209.8 ²7,89626,574
10United Kingdom55.962,023.665,34730,968
7United States56.5713,138.2325,10240,413
64Uruguay34.1836.33,50610,349
102Venezuela27.41349.429,74111,749
51Viet Nam36.7193.389,9591,037
123Yemen20.7224.0 ²24,877966
114Zambia25.2714.613,5251,079
119Zimbabwe23.546.712,838525
 Median34.18  5,551
 ¹ Converted to real $US with the GDP deflator, 2005=100.
 ² Original GDP values for 2009.
 ³ Original GDP value for 2008.

 

Sources: INSEAD - The Global Innovation Index for the innovation index, United Nations Population Division for population data, and World DataBank The World Bank for GDP estimates.

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