● South Korea ranks highest in world for idea intensity (number of patents granted per million population) according to new analysis by PwC
● Sweden, Finland, Denmark and Norway also perform strongly
● UK and China appear in top 20 for first time; Germany and US hold steady (8th and 9th place respectively) from 2010 rankings
● Analysis demonstrates clear relationship between public and private investment in research & development (R&D) and idea intensity
London, 12 September - South Korea has been named the world’s most idea-intensive nation, with the top 20 dominated by East Asian and Northern European countries, according to PwC’s Global Economy Watch.
In particular, the Nordic countries punch above their weight in terms of patents granted per million population: Sweden, Finland and Denmark all appear in the top 10 while Norway is ranked 16th. European nations occupy 13 places among the top 20 with Germany and France ranked eighth and thirteenth respectively.
East Asia also performs strongly on the intensity index with Japan placed fourth and Singapore fourteenth. China appears in the top 20 for the first time and leads the way on the absolute number of patents granted.
The findings are based on PwC analysis of World Intellectual Property Organisation (WIPO) datasets regarding patents granted in 2017, with adjustments for population size. The analysis also demonstrates a strong correlation between idea intensity and R&D expenditure with the top 20 dominated by those nations spending the highest proportion of their GDP on research.
The UK has also broken into the top 20, with 311 patents granted per million population, but it still lags behind many European nations, including Ireland. In terms of absolute number of patents given it is ranked eighth in the world.
Jonathan Gillham, Director of Economic Modelling and Econometrics at PwC UK says,
‘Ideas power the global economy: generating innovative new products and services, strengthening competition, increasing productivity and raising living standards. Scoring highly on ideas intensity should be a source of considerable confidence in a country’s future economic growth prospects.
‘Our analysis highlights that there are a number of different factors that influence idea intensity. Specialisation and geography are important drivers: the prominence of Nordic countries is clearly linked to their investment in emerging fields of renewable technologies. Similarly, East Asian countries perform strongly across computer technology, electrical machinery and digital communication technologies.
‘Yet what is revealed so clearly here is the strong positive relationship between R&D expenditure and idea intensity. Over 100 countries were included in this analysis, and we estimate that around 70% of a change in a country’s idea intensity can be explained by a change in its research and development spending.
‘Our recommendation for governments is that combined public and private investment in R&D can deliver a real economic dividend and should be a key area of economic policy.’
The September edition of Global Economy Watch also includes an overview of intergenerational inequality across the G7 and an assessment of the potential impact of falling bond yields. It is available to read here: https://pwc.to/1PRLfIR
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