The Changing Geography of Innovation, the Current Crisis and Implications for Economic Growth

Policy Brief Number 3
January 2012

The Changing Geography of Innovation, the Current Crisis, and Implications for Economic Growth

Author: Shahid Yusuf

Long-term growth in middle-income countries will be sustained by gains in productivity arising from technological convergence, structural change, improved efficiency, and innovation. As countries move closer to the technology frontier, more of the increases in productivity will need to be sources from innovations of all kinds – product, process, design, organizational, and others. Most innovations will be incremental, interspersed with the occasional radical breakthrough. Written in January 2012, this paper shares some preliminary thoughts on the landscape of innovation and their implications for growth.