LAUSR

In his book How Nations Innovate, Jingjing Huo offers a set of statistical studies on how nations differ in their patterns of technological innovation. The book builds on the ‘varieties of capitalism’ (VOC) literature and this highly specialized work will mainly interest readers familiar with the VOC stream of research. The point of departure is the need to extend the VOC literature beyond its traditionally narrow and often criticized view of innovation as a dichotomy between ’radical’ and ‘incremental’ innovation. In Huo’s first empirical chapter, Huo finds that more coordinated economies like those in continental Europe deliver a higher innovation output on venture capital whereas less-coordinated Anglo-Saxon countries yield higher innovation output from Initial Public Offerings (IPOs), i.e. the first time that the stock of a private company is offered to the public. In reaching such findings, Huo fleshes out comparative differences in the roles played by public and private information played in these different kinds of economies, consistent with the VOC approach. Further chapters turn to the issue of labour markets. The author finds that while technological innovation in Anglo-Saxon economies creates jobs via product innovation, innovation in European economies tends to eliminate jobs via the enhanced productivity of process innovation. In other words, coordinated economies specialize more in process innovation whereas less-coordinated Anglo-Saxon countries specialize more in product innovation. Huo’s studies also indicate that nations differ in the nature of income inequality driven by innovation. In uncoordinated Anglo-Saxon economies innovation increases income inequality at the top via a “superstar effect,” pushing top earners further ahead of median earners. In contrast, innovation in European economies creates a “long-tail” effect widening income inequality at the bottom by dragging bottom earners further behind the median. A strength of the book is its Conclusion: a whole chapter of interesting policy implications drawn from the analysis, such as why the Nordic success story is hard to replicate in other countries. In general, however, Huo’s volume is an anthology of highly technical empirical studies and does target a specialized audience. Within the VOC tradition, however, it will become an important reference in the VOC stream of research for all researchers investigating comparative innovation at the cross-national level.