Science and Technology Leadership: A Test for the Emerging Power

The relationship between achievements in science and technology and economic growth has
been long established, but the path is not always predictable. More significant is the overall
effectiveness of a nation’s National Innovation System (NIS)—the process by which intellectual
concepts are moved toward commercialization for the benefit of a national economy. According
to a NIC-contracted global survey of scientific experts, the United States currently boasts a
stronger innovation system than the developing economies of China and India.

• The idea of an NIS was first developed in the 1980s as an aid to understanding how some
countries were proving better than others at turning intellectual concepts into commercial
products that would boost their economies. The NIS model is evolving as information
technology and the effect of increased globalization (and multinational corporations)
influence national economies.

According to the NIC-commissioned study, nine factors can contribute to a modern NIS: fluidity
of capital, flexibility of the labor pool, government receptivity to business, information
communication technologies, private sector development infrastructure, legal systems to protect
intellectual property rights, available scientific and human capital, marketing skills, and cultural
propensity to encourage creativity.

China and India are expected in 10 years to achieve near parity with the US in two different
areas: scientific and human capital (India) and government receptivity to business innovation
(China). China and India will narrow significantly but not close the gap in all remaining factors.
The United States is expected to remain dominant in three areas: protection for intellectual
property rights, business sophistication to mature innovation, and encouragement of creativity.
Companies in China, India, and other major developing countries have unique opportunities to
be the first to develop a host of emerging technologies. This is especially the case in those
instances where companies are building new infrastructure and not burdened by historical
patterns of development. Such opportunities include distributed electrical power generation,
development of clean water sources, and the next generation of Internet and new information
technologies (such as ubiquitous computing and the Internet of Things—see the foldout). Early
and significant adoption of these technologies could provide considerable economic advantage.

US Government, Global Trends 2025:  A Transformed World, November 2008
NIC 2008-003 (available at www.dni.gov/nic/NIC_2025_project.html)