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The World’s Most Innovative Economies

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Ranked: The World's Most Innovative Economies

The World’s 10 Most Innovative Economies

In the 21st century, innovation has become the heart and soul of economic policy. Developed and developing nations alike are in the race to leave industrialization behind, adapting instead to technology-focused, entrepreneurial societies.

Customized cancer treatment, faux meat products, and the smart home technologies are frequently positioned as ‘the next big thing’. But which countries are consistently innovating the most?

Today’s graphic comes from the seventh annual Bloomberg Innovation Index and highlights the 10 most innovative economies, and the seven metrics used to rank 2019’s top contenders.

Measuring Innovation

Bloomberg calculated each country’s innovation score using seven equally-weighted metrics.

  1. R&D Spending
    All research and development funding invested in an economy each year.
  2. Patent Activity
    Number of domestic patents filed, total patent grants, patents per population, filings per GDP, and total grants awarded measured against the global total.
  3. Tertiary Efficiency
    Total enrollment at post-secondary institutions, graduation levels, and number of science and engineering graduates.
  4. Manufacturing Value-added
    Manufacturing output levels that contribute to exports and domestic economic growth.
  5. Productivity
    Overall productivity levels of the working-age population.
  6. High-tech Density
    Number of domestic high-tech public companies, measured against the number of domestic public companies and the global total of public high-tech companies.
  7. Researcher Concentration
    Number of professionals currently engaged in research and development roles.

More than 200 countries were initially considered for Bloomberg’s Innovation Index. Any country reporting in less than six categories was automatically eliminated, leaving 95 countries remaining. Bloomberg publishes the results for the top 60 most innovative economies each year.

Notable Countries in the Top 60

The U.S. rejoined the top 10 after dropping to 11th in 2018 for low scores in education. Israel moved up five spots to 5th place, while Romania made the largest overall gain, jumping six spots to rank in the top 30.

2019 RankEconomyTotal ScoreChange in Ranking
#1🇰🇷 South Korea87.380
#2🇩🇪 Germany87.32
#3🇫🇮 Finland85.574
#4🇨🇭 Switzerland85.491
#5🇮🇱 Israel84.785
#6🇸🇬 Singapore84.49-3
#7🇸🇪 Sweden84.15-5
#8🇺🇸 United States83.213
#9🇯🇵 Japan81.96-3
#10🇫🇷 France81.67-1
#11Denmark81.66-3
#12Austria80.980
#13Belgium80.431
#14Ireland80.08-1
#15Netherlands79.541
#16China78.353
#17Norway77.79-2
#18United Kingdom75.87-1
#19Australia75.38-1
#20Canada73.652
#21Italy72.85-1
#22Poland69.1-1
#23Iceland68.411
#24New Zealand68.12-1
#25Czech Republic68.093
#26Malaysia67.610
#27Russia66.81-2
#28Luxembourg66.374
#29Romania64.786
#30Spain64.52-1
#31Slovenia64.11-
#32Hungary63.05-5
#33Turkey62.890
#34Portugal62.79-4
#35Greece62.05-4
#36Estonia61.790
#37Lithuania59.73-3
#38Hong Kong58.9-1
#39Slovakia58.03-1
#40Thailand57.775
#41Bulgaria56.360
#42Latvia55.46-2
#43Malta55.43-4
#44Croatia54.98-2
#45Brazil53.62-
#46U.A.E.52.93-
#47Iran52.812
#48Cyprus52.05-1
#49Serbia51.35-5
#50Argentina51.31-
#51South Africa51.03-3
#52Tunisia48.92-9
#53Ukraine48.05-7
#54India47.93-
#55Kuwait47.27-
#56Saudi Arabia47.18-
#57Qatar46.58-
#58Chile46.4-
#59Mexico46-
#60Vietnam45.92-

Brazil rejoined the list at number 45, after not being included on the 2018 list. The United Arab Emirates made the list for the first time, marking the highest debut ever at number 46.

Tunisia and Ukraine were the two countries with the largest losses, which both fell out of the top 50 this year. To date, South Africa is the only Sub-Saharan nation to be ranked in the index.

Newcomers to the Innovation Index in 2019 are some of the largest emerging economies, such as India, Mexico, Vietnam, and Saudi Arabia.

Impact of Global Innovation

Innovation is complex─many factors play a role in the ideation, development, and commercialization of any new technology. And while innovation success can fuel economic growth, it is generally more accessible in high-income economies, where R&D funding is readily available.

“The battle for control of the global economy in the 21st century will be won and lost over control of innovative technologies.”

—Tom Orlik, Bloomberg Economics

The focus of an economy that prioritizes innovation, however, is not simply allocating resources for a group of people─it’s discovering new methods, models, and products that create a better quality of life for society.

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Cities

Visualizing the Footprint of Highways in American Cities

Highways improved mobility for the average American, ingraining the automobile into the urban fabric of American cities, for better and worse.

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The Impact of Highways

Footprint of Highways in American Cities

Visualizing the Footprint of Highways in American Cities

Driving on the open road is a defining feature of the American experience, made possible by coast-to-coast highways. It defined a generation of life and ingrained the automobile into the urban fabric of American cities, for better and worse.

Today’s animations show how highways reshaped the downtown cores of six American cities and created new patterns of urban life. But first, some background information on the creation of the interstate system.

The Interstate Highway System

The U.S. Interstate System was created on June 29, 1956, when Dwight Eisenhower signed the Federal-Aid Highway Act. It would eventually run 46,876 miles, cost $521 billion and take 36 years to complete.

Map of the US Interstate System

From San Diego to Bangor, the interstate highway system connected Americans and opened up the country to commerce and geographic mobility like never before, but for all its benefits, this new transportation network ripped through established patterns of urban and town life, creating a new era of urban development.

The Legacy of Highways: The Suburbs and Inner Cities

The vast geography of continental America helped to entrench personal mobility and freedom into American society. Highways and automobiles accelerated this lifestyle and even changed the shape of entire cities.

According to Prof. Nathaniel Baum-Snow of the University of Toronto, between 1950 and 1990, the population of central cities in the U.S. declined by 17% despite a population growth of 72% in larger metropolitan areas during the same period. Baum-Snow posits that, had the interstate highway system not been built, central cities’ populations would have increased 8%.

Firms followed the workers to the suburbs, but the highways system also created additional benefits for these firms. Cross-country road access freed manufacturing from ports and downtown rail hubs, while allowing economies to operate across larger distances, altering the dynamics of typical urban economies.

Faced with this new reality, inner cities struggled in years to come.

Inner Cities

The introduction of highways created an increase in the supply of land for development through faster commutes to outlying areas. In 1950, half of all jobs were located in central cities. By 1990, less than one-third of urban jobs were located in the core of American cities.

“Not TV or illegal drugs but the automobile has been the chief destroyer of American communities.” Jane Jacobs, Author The Death and Life of Great American Cities

Benefits of new development accrued to the outer areas while the construction of the highways in inner cities displaced largely low-income communities, segregated neighborhoods, increased the amount of air and noise pollution, devalued surrounding properties, and removed access to jobs for those without a car, further concentrating poverty.

Before and After: Six American Cities

A bird’s eye view of six American cities reveals what was and what is now. By overlaying existing highways over the neighborhoods they replaced, it becomes clear how much interstate construction drastically altered America’s urban landscape.

Oakland
Public opposition to the construction of I-980 was so strong that developers abandoned the project in 1971, only to complete it over a decade later.

Miami Highway
The I-95 carved through Miami’s largely black Overtown neighborhood. The construction of a single highway cloverleaf resulted in 20 square blocks being demolished, displacing over 10,000 people in that community.

Providence Highway
The I-95 comprised unconnected segments between 1957 and 1965 through the densest urban areas in a deliberate effort to prevent premature suburbanization and to revitalize the downtown core.

Cincinnati Highway
The I-71 cuts downtown Cincinnati off from its waterfront and a massive freeway interchange forced the destruction of dozens of blocks west of downtown.

Detroit highway construction
Freeway construction transformed Detroit between 1951 and 2010. Previously, its downtown had been surrounded by a high-density street grid. Today, it’s totally encircled by freeways.

Rochester Highway
Rochester is one of many cities opting to undertake freeway removal projects.

As the dotted line above shows, the “moat” surrounding downtown is slowly being removed. The city used reclaimed land from the Inner Loop freeway to construct three mixed-use developments that include below-market-rate units.

The Future of Urban Living: Do Highways Matter?

A new era of living is reconsidering the impacts of these highways on urban centers. As property values rise and existing housing stock is pressured, there are growing concerns over the environmental impacts of suburban life. As a result, urban planners and residents are looking to revitalize city cores and re-purpose land occupied by burdensome slabs of highway concrete.

Since 1987, there have been more than 20 urban highway segments removed from downtown cores, neighborhoods and waterfronts, mostly in North America. The pace of removals has picked up significantly and an additional 10 highways are now planned for removal in the United States.

During the COVID-19 pandemic, American cities have seen their traffic plummet. Rush-hour trips into cities are taking nearly half the time while some are not even commuting at all.

While this situation is likely temporary, it is offering a moment for reflection of how cities operate and whether the car should be at the center of urban planning.

*Hat tip to Shane Hampton, whose 60 Years of Urban Change compilation served as inspiration for this article. Visit that page for many more examples of highway impact on cities.

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Central Banks

The Anatomy of the $2 Trillion COVID-19 Stimulus Bill

A visual breakdown of the CARES Act, the $2 trillion package to provide COVID-19 economic relief. It’s the largest stimulus bill in modern history.

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The Anatomy of the $2 Trillion COVID-19 Stimulus Bill

The unprecedented response to the COVID-19 pandemic has prioritized keeping people apart to slow the spread of the virus. While measures such as business closures and travel restrictions are effective at fighting a pandemic, they also have a dramatic impact on the economy.

To help right the ship, the Coronavirus Aid, Relief, and Economic Security Act — also known as the CARES Act — was passed by U.S. lawmakers last week with little fanfare. The act became the largest economic stimulus bill in modern history, more than doubling the stimulus act passed in 2009 during the Financial Crisis.

Today’s Sankey diagram is a visual representation of where the $2 trillion will be spent. Broadly speaking, there are five components to the COVID-19 stimulus bill:

CategoryTotal AmountShare of the Package
Individuals / Families$603.7 billion30%
Big Business$500.0 billion25%
Small Business$377.0 billion19%
State and Local Government$340.0 billion17%
Public Services$179.5 billion9%

Although the COVID-19 stimulus bill is incredibly complex, here are some of the most important parts to be aware of.

Funds for Individuals

Amount: $603.7 billion – 30% of total CARES Act

In order to stimulate the sputtering economy quickly, the U.S. government will deploy “helicopter money” — direct cash payments to individuals and families.

The centerpiece of this plan is a $1,200 direct payment for those earning up to $75,000 per year. For higher earners, payment amounts will phase out, ending altogether at the $99,000 income level. Families will also receive $500 per child.

There are three other key things to know about this portion of the stimulus funds:

  1. There will be a temporary suspension for any student loan held by the federal government. This means no payments required and no interest accrued until the end of September, 2020.
  2. Borrowers with federally backed loans can request forbearance on mortgage payments for up to six months.
  3. There will be an expansion of unemployment benefits, including a four-month enhancement of benefits. This plan includes freelancers, workers in the gig economy, and furloughed employees.

Big Business

Amount: $500.0 billion – 25% of total CARES Act

This component of the package is aimed at stabilizing big businesses in hard-hit sectors.

The most obvious industry to receive support will be the airlines. About $58 billion has been earmarked for commercial and cargo airlines, as well as airline contractors. Perhaps in response to recent criticism of the industry, companies receiving stimulus money will be barred from engaging in stock buybacks for the term of the loan plus one year.

One interesting pathway highlighted by today’s Sankey diagram is the $17 billion allocated to “maintaining national security”. While this provision doesn’t mention any specific company by name, the primary recipient is believed to be Boeing.

The bill also indicates that an inspector general will oversee the recovery process, along with a special committee.

Small Business

Amount: $377.0 billion – 19% of total CARES Act

To ease the strain on businesses around the country, the Small Business Administration (SBA) will be given $350 billion to provide loans of up to $10 million to qualifying organizations. These funds can be used for mission critical activities, such as paying rent or keeping employees on the payroll during COVID-19 closures.

As well, the bill sets aside $10 billion in grants for small businesses that need help covering short-term operating costs.

State and Local Governments

Amount: $340.0 billion – 17% of total CARES Act

The biggest portion of funds going to local and state governments is the $274 billion allocated towards direct COVID-19 response. The rest of the funds in this component will go to schools and child care services.

Public and Health Services

Amount: $179.5 billion – 9% of total CARES Act

The biggest slice of this pie goes to healthcare providers, who will receive $100 billion in grants to help fight COVID-19. This was a major ask from groups representing the healthcare industry, as they look to make up the lost revenue caused by focusing on the outbreak — as opposed to performing elective surgeries and other procedures. There will also be a 20% increase in Medicare payments for treating patients with the virus.

Money is also set aside for initiatives such as increasing the availability of ventilators and masks for the Strategic National Stockpile, as well as providing additional funding for the Center for Disease Control and expanding the reach of virtual doctors.

Finally, beyond the healthcare-related funding, the CARES Act also addresses food security programs and a long list of educational and arts initiatives.

Hat tip to Reddit user SevenandForty for inspiring this graphic.

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