Editor's note

Traditional classification for states’ progress into, for example,  developed and less developing  countries was based on income and growth (usually, in percentage of GDP or per capita). Even classification made by the World Bank featured the same income approach: states were divided into low, middle and high income countries. Again, it is the approach featuring rate of growth based on GDP’s share!

Static approach to be changed

The “income & growth” approach, however, highlights only the result, an outcome of a state’s development. It does not reveal the factors that have led to a country’s success.

About a half-decade ago the new set of measurements has appeared featuring human well-being, e.g. some say that important is another “growth factor” – national happiness!

Presently, a new fundamental factor and drive for growth has appeared. It is called innovations: thus, the GDP is measured in line with new services, goods, products, etc. for a long-term and sustainable prosperity.

Capacities for innovation

Factors for innovative society have been already elaborated, e.g. by the European Commission in the new EU-2020 strategy with a special strategy’s “sector” for countries’ innovative growth.

Some of them could be mentioned again: scientific and technological base, accelerated public and private investments,  closer connections between research and business, high quality education, transparent politics, “cultural business” and ventures/challenging entrepreneurial spirit ( nothing venture, nothing win).

The Baltic countries have to strive for reaching these innovative growth factors as the only path for human well-being…

Getting stronger understanding

However, the capacities for a new kind of growth could make a new global divide among existing classification of nations’ based GDP’s concept. For example, increasing inequality could hinder innovative process. “Innovative society may be less inclusive and more fragmented”, argued Klaus Schwab, the founder and executive chairman of the World Economic Forum in Davos in International New York Times (16.xii.2013).

Quite notable remark: it’s true, innovative society is a by-product of a country’s development history! “Innovative path” takes its price in social-economic changes: the question is, whether a country wants to take on these new challenges. It could well be that innovative changes might bear disruptive consequences; but that is the price for progress…

New “development revolution”

The innovative ingredients in the states’ development strategies are new phenomena; the process has just begun and it will take quite a while to get a clear vision of all the factors.  

For example, it took about a century to fully understand all the factors in the previous, industrial revolution: such as effects on labour, on education, on corporate organisation and state administration.

However, the innovation strategy is an “elastic process” involving constant changes, which some thinkers describe as “creative destruction” (J. Schumpeter). 

These new disruptive features (as well as creative ones) could be mentioned too: new approaches to jobs (flexible, quick changing, mobile and e-connected), mass education (through open-line courses, MOOCs, etc.), e-communications across the globe and life-long learning, just to name a few.

It the business people understand these challenges, then the state officials would follow…

The Baltic Course’s editorial board wishes our readers, first of all, the decision-makers, a Merry Christmas and very many innovative years ahead! Good luck!