Benchmarking EuropeBenchmarking Europe’’s competitiveness s competitiveness and innovation capacityand innovation capacity

Findings from Findings from The Global Competitiveness The Global Competitiveness Report 2009Report 2009--20102010

2Inno

vatio

n in

The

Glo

bal C

ompe

titiv

enes

s Re

port

2009

-201

0©

2009

Wor

ld E

cono

mic

For

um

The Global Competitiveness Report

The Global Competitiveness Index (GCI)

Europe’s performance in GCI measures of innovation

Outline

3Inno

vatio

n in

The

Glo

bal C

ompe

titiv

enes

s Re

port

2009

-201

0©

2009

Wor

ld E

cono

mic

For

um

Global Competitiveness Report

Launched in 1979 covering 16 countries; it has since expanded its coverage to 133 countries.

Goal: to provide a benchmarking tool for policy-makers and business leaders

4Inno

vatio

n in

The

Glo

bal C

ompe

titiv

enes

s Re

port

2009

-201

0©

2009

Wor

ld E

cono

mic

For

um

The Global Competitiveness Report What are we trying to measure?

GDP per capita 1980-2008 (PPP in international dollars)

0

5,000

10,000

15,000

20,000

25,000

30,000

1980 1984 1988 1992 1996 2000 2004 2008

Chile Korea, Rep. Nigeria

Source: IMF World Economic Outlook Database, April 2009

5Inno

vatio

n in

The

Glo

bal C

ompe

titiv

enes

s Re

port

2009

-201

0©

2009

Wor

ld E

cono

mic

For

um

The Global Competitiveness Report 2009-2010Country coverage

6Inno

vatio

n in

The

Glo

bal C

ompe

titiv

enes

s Re

port

2009

-201

0©

2009

Wor

ld E

cono

mic

For

um

How we do not define competitiveness: “a country’s share of the world market for its products”

This view implies a zero-sum game – one country’s gain comes at the expense of others

How we do define competitiveness: “the set of institutions, policies, and factors that determine the level of productivity of an economy.”

The level of productivity, in turn, sets the sustainablelevel of prosperity that can be earned by an economy.

The Global Competitiveness IndexDefinition

7Inno

vatio

n in

The

Glo

bal C

ompe

titiv

enes

s Re

port

2009

-201

0©

2009

Wor

ld E

cono

mic

For

um

The process of economic development evolves in stages as captured by the model:

1. Factor-driven stageFirms compete in prices, taking advantage of cheap production factors

2. Efficiency-driven stageFirms use efficient production practices to increase productivity

3. Innovation-driven stageEconomies need to produce innovative products using sophisticated production methods

The Global Competitiveness IndexStages of Development

8Inno

vatio

n in

The

Glo

bal C

ompe

titiv

enes

s Re

port

2009

-201

0©

2009

Wor

ld E

cono

mic

For

um

The Global Competitiveness Index The Framework

Key for

efficiency-driven economies

Key for

factor-driven economies

1. Institutions

2. Infrastructure

3. Macroeconomic stability

4. Health and primary education

5. Higher education and training

6. Goods market efficiency

7. Labor market efficiency

8. Financial market sophistication

9. Technological Readiness

10. Market size

11. Business sophistication

12. Innovation

Key for

innovation-driven economies

INNOVATION & SOPHISTICATIONS FACTORS

BASIC REQUIREMENTS

EFFICIENCY ENHANCERS

9Inno

vatio

n in

The

Glo

bal C

ompe

titiv

enes

s Re

port

2009

-201

0©

2009

Wor

ld E

cono

mic

For

um

The Global Competitiveness Index 2009-2010Countries by stage of development*

•Based on GDP per capita and resource intensityEU27 countries are shown in red print.

Transition from 1 to 2 Stage 2

Transition from 2 to 3

Bangladesh Malawi Algeria Albania Bahrain Australia LuxembourgBenin Mali Azerbaijan Argentina Barbados Austria MaltaBolivia Mauritania Botswana Armenia Chile Belgium NetherlandsBurkina Faso Mongolia Brunei Darussalam Bosnia and Herzegovina Croatia Canada New ZealandBurundi Mozambique Egypt Brazil Hungary Cyprus NorwayCambodia Nepal Georgia Bulgaria Latvia Czech Republic PortugalCameroon Nicaragua Guatemala China Lithuania Denmark Puerto RicoChad Nigeria Indonesia Colombia Mexico Estonia SingaporeCôte d'Ivoire Pakistan Jamaica Costa Rica Oman Finland Slovak RepublicEthiopia Philippines Kazakhstan Dominican Republic Poland France SloveniaGambia, The Senegal Kuwait Ecuador Romania Germany SpainGhana Sri Lanka Libya El Salvador Russian Federation Greece SwedenGuyana Tajikistan Morocco Jordan Turkey Hong Kong SAR SwitzerlandHonduras Tanzania Paraguay Macedonia, FYR Uruguay Iceland Taiwan, ChinaIndia Timor-Leste Qatar Malaysia Ireland Trinidad and TobagoKenya Uganda Saudi Arabia Mauritius Israel UAEKyrgyz Republic Vietnam Syria Montenegro Italy United KingdomLesotho Zambia Venezuela Namibia Japan United StatesMadagascar Zimbabwe Panama Korea, Rep.

PeruSerbiaSouth AfricaSurinameThailandTunisiaUkraine

Stage 1 Stage 3

10Inno

vatio

n in

The

Glo

bal C

ompe

titiv

enes

s Re

port

2009

-201

0©

2009

Wor

ld E

cono

mic

For

um

The Global Competitiveness Index 2009-2010Europe’s performance in the 12 pillars

1.0

3.0

5.0

7.0Institutions

Infrastructure

Macroeconomic stability

Health and primary education

Higher education and training

Goods market efficiency

Labor market efficiency

Financial market sophistication

Technological readiness

Market size

Business sophistication

Innovation

EU Accession 12 EU 15 United States

11Inno

vatio

n in

The

Glo

bal C

ompe

titiv

enes

s Re

port

2009

-201

0©

2009

Wor

ld E

cono

mic

For

um

Local supplier quantityLocal supplier qualityState of cluster developmentNature of competitive advantageValue chain breadthControl of international distributionProduction process sophisticationExtent of marketingWillingness to delegate authorityReliance on professional management-

The Global Competitiveness IndexElements of the Business Sophistication Pillar

12Inno

vatio

n in

The

Glo

bal C

ompe

titiv

enes

s Re

port

2009

-201

0©

2009

Wor

ld E

cono

mic

For

umThe Global Competitiveness Index 2009-2010 Europe’s performance in the business sophistication pillar1

4

Loca

l sup

plie

rqu

antit

y

Loca

l sup

plie

rqu

ality

Stat

e of

clu

ster

de

velo

pmen

t

Nat

ure

of

com

petit

ive

adva

ntag

e

Valu

e ch

ain

brea

dth

Con

trol o

f in

tern

atio

nal d

istri

butio

n

Prod

uctio

n pr

oces

s so

phis

ticat

ion

Exte

nt o

f mar

ketin

g

Willi

ngne

ss to

de

lega

te a

utho

rity

Rel

ianc

e on

pr

ofes

sion

alm

anag

emen

t

7Highest/Low est w ithin EU 27 EU 15 EU Acc 12 United States

Scor

e (1

-7)

13Inno

vatio

n in

The

Glo

bal C

ompe

titiv

enes

s Re

port

2009

-201

0©

2009

Wor

ld E

cono

mic

For

um

Capacity for innovation (of companies)Quality of scientific research institutionsCompany spending on R&DUniversity-industry research collaborationGovernment procurement of advanced technology productsAvailability of scientists and engineersIntellectual property protectionUtility patents

The Global Competitiveness IndexElements of the Innovation Pillar

14Inno

vatio

n in

The

Glo

bal C

ompe

titiv

enes

s Re

port

2009

-201

0©

2009

Wor

ld E

cono

mic

For

um

The Global Competitiveness Index 2009-2010Europe’s performance in the innovation pillar

Scor

e (1

-7)

14

Capa

city

for i

nnov

ation

Quali

ty o

f scie

ntific

rese

arch

inst

itutio

ns

Com

pany

spe

nding

on R

&D

Unive

rsity

-indu

stry

colla

bora

tion

in R&

D

Gov’t

pro

cure

men

t of

adva

nced

tech

pro

duct

s

Avail

abilit

y of

scie

ntist

san

d en

ginee

rs

Utilit

y pa

tent

s*

Inte

llect

ual p

rope

rtypr

otec

tion

7Highest/Low est w ithin EU 27 EU 15 EU Acc 12 United States

15Inno

vatio

n in

The

Glo

bal C

ompe

titiv

enes

s Re

port

2009

-201

0©

2009

Wor

ld E

cono

mic

For

um

The Global Competitiveness Report 2009-2010How to obtain more information

Visit our website for further information and to browse

The Global Competitiveness Report 2009-2010:

www.weforum.org/gcr