The European Union has released its Innovation Scorecard for 2005. The EU is behind:

The US and Japan are still far ahead of the EU25 as shown in Figure II. The innovation gap between the EU25 and Japan is increasing and the one between EU and US is close to stable.

I took a look at their methodology to see what, exactly, is being measured... that is, is this conclusion that the EU is behind a statistical phenomena? Or what?

What the scorecard tries to do is measure both innovation "inputs" and "outputs:"

Inputs include things like workforce education levels, spending on R&D, broadband penetration, and stats related to the growth of small-medium enterprises. (I would be fascinated to see the relationship between some of these factors and overall tax rates). Also, I noted that public funding of R&D figures in a couple slots here as an input. My own take would be to weight private funding *much* more heavily, since the public funding ventures I have examined tend to be a) either of marginal projects with less potential or b) duplicative of private funding. One wonders, if public funding were weighted less heavily, would the EU be even further behind? Or is their emphasis on public funding part of the reason that they are further behind?

Outputs include things like the number of patents and trademarks, employment in high-tech enterprises, and sales of new products. Gee, and we heard that having a lot of patents is bad? I guess not so bad. The innovation leaders seem to have plenty of patents as well as everything else such as product sales. Go figger.