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Five nations boosting their culture of innovation

How places like China, Brazil, and Israel are taking aggressive steps to encourage more start-ups – and what that means for the US.

By / Staff writer / February 22, 2010

Andre Averbug (l.) and his partner, Paulo Lerner, have started a software business in Brazil. Here they discuss ideas in their office in a university-based incubator, one of several being started in the country to spur innovation.

Chantal James/Special to The Christian Science Monitor


From Europe to Asia and beyond, the hunger to innovate has created lots of entrepreneurial competition for America.

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Start-up firms are helping to manage traffic in the teeming cities of Brazil and have allowed less-populous nations such as Israel to become fertile soil for new business ideas.

These nations view innovation as a vital source of economic competitiveness. Not that long ago, the United States was the clear world leader in most industries and technology.

Now, while it's hard to put any other nation as "No. 1," America no longer enjoys such a privileged position.

The global spread of inventiveness is a disruptive force but also a beneficial one, economists say. If more of the world's people are innovators, more will be creating new industries or solving problems like how to control carbon emissions.

"Innovation is growth, and growth creates jobs," says Vijay Govindarajan, who heads the Tuck Business School's Center for Global Leadership at Dartmouth College in Hanover, N.H.

And increasingly, he says, innovation is occurring in a global matrix with ideas flowing among developed and developing nations.

"The United States can be competitive in the next 25 years only if we embrace globalization 150 percent," he says. "Globalization is like gravity. You can deny it only at your peril."

Here's a look at five nations that are using varied strategies to ride the elevator of innovation-led growth.


The competition isn't just between East and West. Brazil symbolizes the way continents of the South are ramping up efforts to nurture new businesses. A major government-backed effort to support start-ups includes a growing array of university-based incubator programs.

The effort is giving wings to people like Andre Averbug, a business school graduate whose start-up provides software for mass-transit services. "A few years ago, Brazil was seen as a commodity country," he says. "I think Brazil now is being looked at as a good country to do business."


This island nation has prospered not just because of investments in education and port infrastructure, but also because of its promotion of start-ups. Its experiments have run the gamut from subsidies for ventures involving targeted technologies to putting up public money alongside venture investors who come to the city-state, Harvard University business expert Josh Lerner writes in a recent report for the American Enterprise Institute.

The result: Even though its economy looked similar to that of Jamaica in 1965, per capita gross domestic product has reached $31,400 in Singapore, whereas Jamaica's had edged up to just $4,800.