The chart shows the spread of the innovation output of 125 countries as a function of the innovation input they use. The linear association between output and input is strong as one would expect : correlation coefficient r = 0.85. Seventy one percent of output variation are explained by the input variation (R² = 0.714). However, some countries are more efficient than others in the way they use their inputs. The efficiency index, computed as the ratio of output per input times 100, provides a best-in-class group : in descending order Côte d’Ivoire (106), Nigeria (103), China, Pakistan, Moldova (101), Sweden (92), Brazil (91), Argentina (90), Bangladesh (89) and India (89).

To better illustrate the relative efficiency of all countries, the chart is divided into four quadrants by the input median (red vertical line), and the output median (red horizontal line) :

1. Upper left quadrant : efficient innovators. This group includes those countries that succeed in getting an above median output from their below median input. Moldova, Brazil, Serbia, Argentina, India, Viet Nam can be found here. They are in relative terms the high-performers.
2. Upper right quadrant : powerful innovators. Included are countries that both use above median inputs and obtain above median outputs. As expected, such countries as Switzerland, Sweden, Netherlands, Germany, United States, Finland, China, Israel, Korea fall in this quadrant.
3. Lower left quadrant : modest innovators. Here one finds countries that use below median inputs and achieve below median outputs. Destitute economies prevail in this quadrant : Niger, Yemen, Ethiopia, Zambia, Rwanda.
4. Lower right quadrant : inefficient innovators. Although they use above median inputs, their innovation output is low. In other terms, some innovation resources are wasted. Examples are Bahrain, Saudi Arabia, Mongolia, Greece.

Given the high correlation of output with input, we can get a better insight of the innovation efficiency ranking by looking at the residuals (difference between the computed output score and the line of fit). Now, the top ten ranking is as follows (residual in brackets) : China (14.1), Sweden (12.4), Moldova (12.2), Switzerland (10.3), Nigeria (10.0), Côte d’Ivoire (9.5), Pakistan (9.3), Hungary (8.8), Netherlands (8.6) and Brazil (8.5).. At the opposite end, the 10 least performers are : Bahrain (-14.8), Algeria (-14.4), Namibia (-11.8), Niger (-10.0), Bosnia and Herzegovina (-10.0), United Arab Emirates (-9.4), Singapore (-8.9), South Africa (-8.8), Australia (-8.5) and Kenya (-8.3).

Such a brief data analysis does not justify any conclusions about the why's and the how's of innovation — even assuming that the methodology used by the source is trustworthy and robust. However, the neighborhood of Moldova and Sweden in the top 10 group may suggest some theory about innovation, for example that countries with huge differences as regards their wealth, economic background and cultural structure can still achieve relative high innovation outputs by adopting proper policies.

A similar reasoning may be applied to the low performers : Singapore and Niger both fall considerably below the line of fit, likely for quite different reasons. Singapore is known for its investment effort in the advanced technologies and in modernizing its economy, but apparently it is not getting enough bang for the buck — could it be a situation of misplaced bets ? Niger may be a plain case of a struggle for survival that does not leave much breathing space to organize for innovation. Further investigation would be required to find the answers.

Sources: INSEAD - The Global Innovation Index

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