THE economy is recovering, yet American confidence remains mired at levels more commonly seen in recessions. For that blame unemployment, petrol prices and a deeper, nagging feeling that America is in decline. A Gallup poll in February asked Americans to name the world’s leading economic power. By a significant margin, they said China.
Barack Obama has exploited this anxiety. America, he has said, faces a new “Sputnik moment” and must “compete for the jobs and industries of our time” by spending more on research, education and infrastructure. But the notion that America is on the verge of being vanquished by cleverer, more innovative competitors is flawed. First, competitiveness is a woolly concept that wrongly supposes countries, like football teams, win only when another team loses. But one country’s economic growth does not subtract from another’s. Second, America’s ability to innovate and raise productivity remains reasonably healthy. The problem is that the benefits of that innovation and productivity have become so narrowly concentrated that workers’ median wages have stagnated.
To read the full, original article click on this link: Innovation: Still full of ideas, but not making jobs | The Economist