The United States has long dominated much of the knowledge economy, not least owing to an innovation environment that has proved highly attractive to foreign talent. But China has been watching carefully, adapting crucial lessons from the U.S. to the local context. And its efforts are bearing fruit.
America’s lead is significant. In 2000 to 2019, the U.S. had far more Fortune Global 500 companies than any other country. In 2000, the country boasted 179, compared to Japan's 107 and just 10 for China. Though China surpassed the U.S. in 2020, American companies have retained an absolute advantage in market capitalization, profitability and technological innovation.
American tech giants such as Microsoft, Apple and Nvidia are especially dominant, having expanded faster internationally and outsourced their operations more broadly than their counterparts from China, the European Union, Japan and India. Crucially, they have also attracted more of the world’s talent.