US still leads the world in innovation, despite economic crisis

America Also Strong on Personal Freedom and Community Life, Finds Legatum Prosperity Index

Finland is the Most Prosperous Nation Overall, While the United States, Ranked 9th, is the Top-Performing Large Nation. Poor Performance on Health Drags the U.S. Down

The third edition of the Legatum Prosperity Index ranks 104 countries (covering 90% of the world’s population), based on a definition of prosperity that combines economic growth together with measures of happiness and quality of life. Finland tops the Index, with the U.S. ranking ninth out of 104 countries in the Index, ahead of large European nations such as Britain, Germany and France, which all still make the top 20. Finland is narrowly ahead of Switzerland, Sweden and Denmark; Zimbabwe ranks last, following Yemen and Sudan.

“From Bobby Kennedy to France’s current President, Nicolas Sarkozy, influential thinkers have lamented that economic growth alone is not sufficient for prosperity,” said Dr. William Inboden, Senior Vice President of the Legatum Institute. “The Legatum Prosperity Index is the world’s only global assessment of both wealth and wellbeing,” he continued. “Among the world’s larger nations, the US is the world leader: it has achieved great prosperity through high levels of innovation and entrepreneurship, robust commitment to personal freedom, and governing institutions that generally foster economic growth. Having a balance with strong families and communities, political and religious liberty, education, and opportunity is also critically important,” concluded Dr. Inboden.

The U.S. scores first globally in the measure of Entrepreneurship and Innovation, a gauge of which countries possess the greatest ability to commercialize ideas and launch new enterprises in the near future. The US has some weaknesses, however, ranking 27th globally on health, and 19th in the world on safety and security.

Key Findings from the 2009 Legatum Prosperity Index:

- The U.S. ranks 1st in the world in Entrepreneurship and Innovation and 2nd in the world in the strength of Democratic Institutions.
- Two other areas of American strength are Education (7th globally), and Social Capital (also 7th globally).
- The U.S. performs worst in the health category, ranking 27th in the world. Dissatisfaction with their overall health is dragging down Americans’ sense of well-being, affecting their determination to get ahead and their faith in their healthcare system.
- Ranking 19th globally, safety and security is another relative weakness of the U.S. Lower scores are driven by the large number of people in the US who feel they live in unsafe places, coupled with a high per capita murder rate relative to other developed nations.
- The U.S. ranks 16th globally on Governance, indicating that Americans believe that there is too much corruption in their government and sometimes doubt the honesty of elections. The United States’ laws  and regulations are generally seen to foster economic growth, but government’s negative effects pull down its citizens’ quality of life.
- Northern Europe dominates the top five spots in the Index: Finland (1st), Sweden (3rd), Denmark (4th), and Norway (5th).

The Index identified nine key factors that drive economic growth and personal wellbeing, which are foundations of prosperity. Each of these nine factors is represented in a sub-index and a country’s final Prosperity Index ranking is generated by averaging its scores across all nine sub-indexes, equally weighted. More information on the Prosperity Index, including full country rankings, background on data and methodology, and profiles of each country can be found at http://www.prosperity.com.

Source: Legatum