Innovation in the United States and Europe

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This paper explores investment, entrepreneurship, and innovation in the United States and Europe and takes stock of the two region’s relative performance in encouraging technological change. Although there is no single perfect metric for measuring success in innovation, there are several qualitive and quantitative measures through which we can assess how countries compare in fostering a culture that promotes the improvement or development of products and services. That evidence suggests that, at least for now, the United States has a far healthier innovation culture than Europe. This chapter also explores some of the specific criticisms that assert that innovation has declined in the United States as compared to Europe in part because of ineffective competition policy in America. In the end, the fact that the United States continues to be the world’s innovation hub warns against implementing sweeping and radical changes to antitrust and broader regulatory policy that might undermine a culture that fosters competition, innovation, and economic growth.