The innovation greenroom makes all the difference

Numbers cannot lie, and so goes an adage. The whole globe is fragmented into jealously protected geopolitical entities. Of the 189 or so countries that the lithosphere is divided into, some countries are not as fortunate as others. There is a stark and yawning lacuna between the industrial powers and the lagging agrarian economies plagued by numerous debilitating drags.

Per capita GDP and GDP, the contextual?difference

The richest and most powerful countries belong to two distinct categories. The first category consists of small city-states, principalities, and countries that could strike it rich as global business hubs, tax havens, and areas endowed with precious natural resources. The prominent members of the group are Qatar, Macao, Monaco, Luxemburg, Singapore, UAE, Kuwait, Brunei, San Marino, etc. in terms of GDP these countries are not major contributors to the global economy. But the per capita productivity and income are very impressive. Most often than not, these high-income countries are not playing a lead role in the technological advancement of the world. Strategic geographical position, gifts of nature and farsighted managerial skills of the people at the helm catapulted these countries to the limelight. The counties of this category have not been particularly successful in making the human resources they were endowed with optimally productive to bring out the best of their capabilities. As a matter of fact, per capita GDP is an indicator that reflects the economic muscle and standard of living of the citizens in a country. In a larger geopolitical context, these prosperous and thriving islands of bustling life do not play a lead role.

Table 1: Per capita GDP of major economies as of 2017 (Ref: https://www.worldometers.info/gdp/gdp-per-capita/)

High GDP and innovation intensity

The global economy is engined by a group of traditional and emerging industrial powers. The front runners of this group are the US, China, Japan, Germany, the UK, India, France, Brazil, Italy, and Canada. India has a $2.65 trillion strong economy owing to the sheer strength of its population. With a whopping 1355 million population, India cannot be compared with countries having populations in the 40- 100 million range. As for the other nine members on the elite list, the critical factor that made a difference is the innovation sector. The US, China, Japan, Germany, the UK, and France wield impressive geopolitical power, primarily due to the technological edge and the booming industrial backyard they fall back upon.

There is a natural correlation between GDP and technological edge, this coupling is not linear though. Since WW II, the US has been playing the lead role in the global industrial progression. Rich and diverse natural resources, and a huge population of around 300 million which is inured to a daring entrepreneurial cultural climate not much burdened by the medievalist trappings, capacitated that great nation to play a pioneering role in the forward march. The dynamic and conducive innovation climate placed the country at a vantage point. With a $19 trillion strong economy, the US is much ahead of the rest of the world. The real soft capital of the US is the soft capital to dream it big, plan it big, and execute it big propelled by the innovative funding agencies to fuel it big.

China, on the other hand, is an economy that is waking up. With a 1400 million-strong population, China has begun only, it has still a long way to go to reach a point of productive saturation. The $12.3 trillion strong economy, with the present predominance in the patent publication space, is likely to grow more and even outstrip the US economy. Even amidst the cod scare and global slump, China had been able to maintain its growth momentum. China accounts for 15.1% of the global GDP, which is comparable to the 24.1% that the US accounts for. Whereas India which has almost the same population as China, around 20% of the world population, claims a mere 3% of the world market share. When China reaches a stage of saturation or plateaus at an exalted level, it is likely to be the economic powerhouse of the world. In any case, China had been the innovation capital right from the dawn of civilization. At this rate, so to speak, the best is yet to come from China. The mosaic of nations in the Far East, particularly China, Korea, Japan, and Taiwan, having a cultural common denominator, has a favorable scientific temper, and an assiduous academic bent. This could be a lesson for many countries in the world.

Table 2: The Annual GDP of the major economies in the year 2017 ( Ref: Worldometer)

The traditional industrial economies like Japan, Germany, the UK, France, and Italy continue to be the key players in the innovation circles as usual. But they are way behind the North American and far eastern leaders.

The publication pattern in the powerful economies

The core technology areas where most of the innovation is taking place are depicted in the figure below. Relecura database, covering 160 geographies, shows digital data processing, electric elements, and semiconductor devices, data transmission, testing materials, medical preparations, chemical or physical processes, pictorial communication, data processing, diagnosis and wireless communication. In all areas, China has a solid upper hand. The US is the only country comparable to China.?In the case of chemical or physical processes, China predominates dwarfing all others to insignificance.

Fig. 1: Publication pattern of major industrial economies over the past five years (Courtesy: Relecura)

Table 3: The publication trend in the major economies (Courtesy: Relecura IP analytics platform)

As the table above indicates, during the five-year time period from 2016, China had published 4,756,438 patents, whereas the US had published 2,629,830. Japan, the third most important economy in the world had 1,007,539 in the same period. The traditional industrial powers of western Europe trail way behind.

Conclusion

Though there are outliers and freak performers, as a general rule, the GDP of a country is directly related to the patent assets it is privy to. Economic growth and technological competitiveness could be maintained in the mainstream economies only by streamlining the innovation process. Human resource development, research and development initiatives, and industrial management policies need to be streamlined with this cherished goalpost in mind. Fortunately, there are innovative AI-powered databases and custom tools to goad and guide this process, accruing impressive results on the ground. If Policymakers, technocrats, and research scholars could avail of such tools to navigate their efforts in the patentable direction, that would make a change?the?world over in terms of GDP and human resource management.