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Leadership & Organisations

The World’s Smartest Countries

Kai L. Chan, Distinguished Fellow, INSEAD Innovation & Policy Initiative |

The countries most likely to produce the next Google.

When Sergey Brin was 16 and his family had already been living in the United States for a decade, his father took him on a short trip back to Russia. It was 1990 and the Soviet Union was collapsing. By the second day of the trip, the teenager had seen enough to grasp what his life could have been. Taking his father aside, the future co-founder of Google told him in earnest: “Thank you for taking us all out of Russia.”

Although Russia has since rebounded, young Brin won the citizenship lottery, having been raised in the U.S. where he had access to great schooling and an environment to nurture his brain. As a child, he received a Montessori education, known for cultivating creativity. Later he went on to study at Stanford University where he met Larry Page and together they would go on to found one of the most valuable brands in the world.

Brin’s story illustrates how – given the proper environment – education and creativity can give rise to transformative innovation in the global knowledge economy. His sharp mind would have excelled anywhere, but it was the intellectual and entrepreneurial environment of Stanford that enabled Brin’s full talent to blossom.

Building on these parameters, the Intelligence Capital Index (ICI) was created to measure which nations are most likely to foster the big ideas of tomorrow. In that sense, the ICI can be thought of as a ranking of the world’s smartest countries – with a twist.

In contrast to alternative measures of human capital and talent, the ICI has several distinguishing features:

1. It considers education outcomes both in terms of quantity and quality, while emphasizing quality.
2. It measures cognitive skills at different stages of the human life cycle, again with an emphasis on top (elite) performance.
3. It includes migration as an important external channel for countries to acquire and develop human capital.

The smart winners

The U.S. comes out on top. Indeed, it is the only country that gets an overall A+ on the ICI. Its dominant position is a result of its exceptional performance in terms of quality of education (at the elite level). It is home to a majority of the world’s leading institutions of higher learning and has earned an outsized number of Nobel prizes and Fields medals. 

In second place, the United Kingdom performs extremely well for both the quality of education and elite cognitive skills. With a score nearly identical to that of U.K., Germany places third, with strong showings for quality of education. It also ranks well for creativity and openness to foreign talent.

Australia places fourth owing to its top scores for elite cognitive skills and openness to immigration. Ranking fifth, Singapore is also well known for its high scores on standardised tests (e.g. PISA) and its ability to attract top foreign talent. Its performance is outstanding given that some ICI indicators (e.g. the number of top 500 universities) explicitly favour big countries (as large countries are better able to create clusters of excellence).

Sweden, Switzerland, Canada, Finland and Denmark round out the top 10 smartest countries, with typically high scores on the aspects of creativity and attractiveness for immigrants.

The table below shows the top 10 countries according to the ICI. The score and letter grade are computed based on the countries’ global ranks for each of the ICI’s underlying four aspects.

The ICI assessed 128 countries. The full rankings and methodology can be found here.

How the ICI is built

Under the education aspect, indicators measuring quality, such as a country’s number of global top 500 universities, are given twice the weight compared to indicators that measure quantity, such as education enrolment ratios.

Similarly, under the cognitive skills aspect, double the weight is given to indicators measuring elite performance (e.g. the 95th percentile scores on standardised tests such as PISA, or the share of GMAT scores above 700) compared to average performance (e.g. the mean scores on such tests).

Why this insistence on education quality and elite skills indicators? Because the people who will go on to become the next Sergey Brin, Mark Zuckerberg or Jeff Bezos are not middle-of-the-pack students. Rather they are drawn from the right tail of the distribution of talent. Moreover, measures of quantity of education are meaningless without adjusting for quality. To take the most obvious example, a degree from an unknown university simply doesn’t provide the same nurturing as one from Oxford or Princeton.

Creativity should be part and parcel of any measure of human capital. Rote learning and memorisation are fast losing value in an era increasingly relying on computers and robots. Indeed, creativity is what separates humans from robots – it is the key that unlocks the power of education. For the purpose of the ICI, creativity is assessed using the Global Creativity Index and R&D expenditures as a share of GDP.

Last but not least, the attractiveness and openness to foreign talent aspect is key to a country’s stock of “smarts”. Cities such as New York, London, Paris and Singapore are magnets for bright and ambitious people. Even in the absence of a good pipeline of domestic talent, these cities, and thus their respective countries, create fertile conditions for boundary-pushing knowledge and innovation.

Location still matters

If you are an employer, the ICI can be used as a tool in guiding where to look for or where to base talent/staff that will give your company the cutting-edge ideas you need to succeed in the knowledge economy. 

As humans have a tendency to push themselves harder around peers who challenge them, students and working professionals hoping to change the world (or simply grow their own human potential) may look at the ICI as a favoured-destination guide. While it is often said that talent can be based anywhere these days thanks to modern telecommunications, location still deeply matters – in fact, its importance has actually increased.

Wall Street, Hollywood, and Silicon Valley are geographic clusters of excellence that have grown in prominence along with the internet. Likewise, although the educational material taught at Ivy League schools is not much different than at less-competitive institutions, the attractiveness of an elite education has similarly jumped. The urban theorist Jane Jacobs opined that clusters allow for greater interaction and chance encounters of like-minded people holding different pieces of the puzzle.

Education for all

Policymakers may draw insights from their own country’s scorecard details. Although the ICI emphasises the role of geniuses in generating society’s innovations, these elite performers function within the parameters of the national infrastructure. That is, it is necessary to raise the bar for society as a whole while simultaneously harnessing the capabilities of the Einsteins. Take India, ranked 66, as an example of a country that needs to balance the capabilities of its masses and its elites. As The Economist wrote, “India may be famous for its elite doctors and engineers, but half of its nine-year-olds cannot do a sum as simple as eight plus nine.” This gap creates a brain drain, as the elite finds too little support at home in a largely under-educated society.

Of course, a country must also raise its creativity quotient (an important fertiliser being diversity) and remain open to foreign talent. In this sense, global political movements limiting migration (e.g. Brexit) may impede the ability of countries to take advantage of the global talent pool. For instance, if the U.S. had closed its borders to the Brin family when they immigrated in the 1970s, the U.S. – and the world – would have missed out on Google and possibly even the development of Silicon Valley. In that regard, French President Emmanuel Macron’s invitation to the world’s scientists to come to France (ICI rank 16) is a step in the right direction for its ascendency as a hub for smart people.

Might these political developments lead future generations to search the internet in French one day?

Kai L. Chan is a Distinguished Fellow at INSEAD Innovation & Policy Initiative.

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So if I understood correctly a major factor that assesses intelligence in this ranking is knowing English? It is half of the GMAT, so it would be safe to say that for INSEAD, if you know a language you are smart. Which is contrary to the publicly stated reason why the GMAT scores compared to the top 50 US MBAs is lower, which is that because the student body is so international, the verbal part can be lower.
Also, it is somehow unlinked to assess the smartest countries with their capability to "produce the next Google". That statement is very heavily weighted by the easiness from the public and private sector to found businesses and fund them.
I don't know if many people would dare to argue that the Russian technological scene in terms of IT skills, or China, or North Korea, or India is on par, if not better than in the Top 10 countries, they just do not have the regulatory framework to create the next Google, nor the internal market to develop the businesses internally. Also, they don´t speak English as well as the top 10 countries :).

Kai L. Chan,

English is one factor amongst many. I also argued this in my Power Language Index, which shows that English undeniably confers a benefit to its speakers given that it is the global lingua franca. Insomuch as there are biases in GMAT and other tests that favour English, it should be reflected in the index because the world does do business, publishes research, etc. in English. That is, a person could be a genius, but in today's world if that person did not have some kind of proficiency in English he/she would be very much excluded from the global intellectual community.

INSEAD is indeed right in pushing its student body to be proficient in a second or third language, as multilingualism is important in our globalised world. If there is an English bias in the GMAT score, a better place to look is at the quantitative or other non-English-reliant scores of the GMAT to gauge which schools are attracting the 'smartest' people.

The ICI tries to measure which countries are producing and/or home to the world's geniuses, as it will be there that the next great things will emerge. The ICI performance is driven primarily at looking which countries are producing the best elite performance and then also weighing in whether they can keep them or attract the smart people from other countries. Insomuch as poorer/smaller countries do not have the infrastructure to produce the next Google, we may be interested instead on seeing which countries are most likely to produce the next Einstein. And certainly no man/woman is an island, and how they develop and reach their potential is very much dependent on the society they live in. The USA and other large countries do indeed benefit from size (as many of the attributes of 'smarts' are, like most things in life, distributed normally. So in a big population there is a better chance to find an observation 3 standard deviations from the mean (i.e. a "genius" in the case of the ICI and smarts).)

Kai L. Chan,

China is 30, Japan is 11. Actually, if not for the immigration channel, Japan would have ranked 5th. There are several interesting points with China and Japan. First, as these countries have weak English skills, they are disconnected from much of the global intellectual community. They are also less attractive to the global talent pool given the language (and cultural) barrier that most immigrants would find there. Another issue is that although China and Japan score very well in most scholastic/aptitude tests, it is their mean scores that are high. Although their elite scores are also high, they are relatively less strong there. In fact, I would opine (subject to further research) that the top 0.1% there would not be as strong as the top 0.1% in some of the leading countries. Moreover, creativity is probably held back from what it could be in these countries because of cultural and other factors.

Mark Spencer,

I am not convinced that the methodology is entirely sound or paints the most accurate picture... but then what is the ICI except that it is what this assessment is. Some other reports show how flawed the US education institutions are, but this seems to be only measuring the elite, and the elite simply go to where the elite are paid and are continually supported, driving the investment, so in turn the capital. I also suspect that a number of Uni's in the top 500 and Nobel etc. reflects anything more than where they are attracted to which is already measured elsewhere, so compounding the result. So, I am not sure what it is attempting to address?

Kai L. Chan,

The ICI is a way to adjust for other measures of human capital that are over reliant ion mean scores. In fact, to my knowledge this is the first index that explicitly and dominantly measures performance based on the elite measures (e.g. 95th percentile on SAT and share of scores above 700 on the GMAT). Whereas previously the lens was always to look at mean scores, this index reflects the reality that change and genius are associated primarily with elite performers.

The reason this matters is because it is often overlooked that a country can have a lower mean 'smarts' score but also be home to more 'smart' people. Think of 2 countries each with 3 people. In Country A all have 'smarts' of 110, whereas in Country B the 3 people have smarts of 80, 100, and 120. By most standard measures, we are led to believe that Country A is 'smarter'. But if it requires a smart quotient of at least 115 to solve a puzzle, it will be Country B with the lower average 'smarts' score that will prevail.

What the ICI assesses are the elites/geniuses of society; not the average -- even though the elites function amongst the average. In fact, I argued in a WEF piece that although the US is home to the most Nobel Prize winners, elite universities, etc., its delivery of education is weak for the general population.

If I had the sum up what the ICI is trying to address, I'd say that it is that other measurements are flawed because they simply look at, say, the mean GMAT scores across countries and say the one with the highest score is the 'smartest' and where the geniuses or next Googles will be found. I argue here that instead of looking at the mean score, it is more important to look at which countries are performing best at the elite level. Again refer to my example of Countries A and B above.

Mark Spencer,

Thanks for your detailed reply. It does seem difficult to represent the background behind the complex calculations, but I am able to see the effort that has gone into the move away from averages and relate the calculations to more of what really happens. I do appreciate Google, and I'm sure some are comforted by the returns that Google earns, let us hope for something a lot more earth-moving and profound in our shared future.

Dennis Schumann,

These tabulations are suspect with regard to Israel. In America, if you look at the Nobel prize, Musical instrument competition, science, computer programming, and mathematics pro rata, America is coming up very short. By comparison, Israel's pro rata accomplishments are phenomenal. And the "elites", look at where we are with the elites in control. These "elites" are not the super educated they are the privileged class. Elitism through accomplishment is to be admired, but through privilege is to be disdained.

Kai L. Chan,

Hi. Very good question/comment, and indeed Israel is a very special case. Actually, Jewish performance is very strong and accounts for much of the genius observations we see worldwide. Nevertheless, there are interesting dynamics within Israel itself.

First off, you are correct on the measures, if scaled per capita, being less favourable to the USA. However, the index specifically favours large countries because size is needed to generate clusters and to have an intellectual community. A country of population 10 with one Nobel laureate is not likely to have a community to rely on to foster his/her great ideas. Whereas a country with a billion population and 100 Nobel laureates is much more likely to develop and intellectual cluster. There would also be small sample bias in looking purely on pro rata measures.

Israel and other countries with heterogenous populations pose a significant challenge in measurement as data are not usually disaggregated by the various sub-populations. So in Israel the divergent performance of its ultra-religious and secular communities leads for a blended pool to show a low 95th percentile score for the population as a whole, whereas the 95th for each subgroup is highly different. This also applies to the USA where there is a large difference in test scores by the the ethnic/racial sub-populations.

Finally, the elites referred to here are the academic elites. The gauges are test scores (PISA, GMAT, PIAAS) and share of highly ranked schools, etc. These markers try to avoid the elite that are detached from achievement. Indeed, the top-performers are not likely the privileged class -- they are likely to have strong results, but not at the 95th percentile level.

In any case, what the index tries to measure is where the next bright idea will emerge. Given the political and geographic dynamics of the world, bright ideas and minds that originate in one country are often developed or bloomed in the USA.

No measure is perfect, and the next iteration of the index might look at cities rather than countries. It should also try to correct the defects posed by heterogeneity of the data. Another facet that might also be more relevant is to look at the top 99 or 99.9 percentile rather than just the 95th -- these are almost certainly completed detached from the privileged class; rather they are pure measures of the genius class.


But why this countries are here? i know. They have good start and loyal goverment? not like other countries. they work 12h in day and get the same money as britains in 2hours. Thats not fair.

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