The state of innovation

The Global Innovation Index 2014 (GII) has ranked Australia 17th out of 143 economies, measured for progress in innovation performance and having a well-linked innovation ecosystem.

Launched in Sydney by the federal Minister for Industry Ian Macfarlane as part of the meeting of international business leaders (B20), the report details how well economies around the world support innovation and investment with ‘the human factor in innovation’ a key theme.

“We are up two positions on our 19th ranking last year and first in the world for trade and competition,” said MacFarlane.

Australia also had strong performances in tertiary education (ranked 7th), research and development (8th), and general infrastructure (9th).

“The challenge now is for Australia to make further gains by building on our areas of competitive strength. We have a strong base to work from, with Australia recording a solid global performance, coming fourth overall in our region and sitting among the world’s top 10 economies with enabling conditions for innovation activity,” said MacFarlane.

Rather than just looking at traditional measures of innovation such as level of research and development, the GII measures aspects behind innovation such as human capital and research, infrastructure, information and communication technologies, business sophistication (such as knowledge workers, innovation linkages and knowledge absorption), and creative knowledge and technology outputs.

Although what this measure of inputs and outputs really means may not be so obvious, as AusBiotech stated when reporting on last year’s GII: “… the 2013 INSEAD Global Innovation Index ranks Australia 11th in terms of innovation input and 32nd in innovation output, but when these figures are converted to innovation efficiency ratio, Australia dives to 116 out of 140 countries assessed. This stark measure shows that Australians are brilliant at coming up with ideas but poor at translating them into products.”

This year’s GII saw Switzerland remaining on top for the fourth year in a row, with the United Kingdom coming in second and Sweden third. Sub-Saharan Africa posted significant regional improvement.