In other studies, the World Bank rated the U.S. third, behind Singapore and New Zealand, on ease of doing business. The U.S. was No. 3, behind Canada and Australia, in terms of starting a new business, the bank said.

Insead researchers looked at data from the World Bank, the World Economic Forum's annual Executive Opinion survey and the International Telecommunications Union. They studied to what degree nations and regions respond to the challenge of innovation.

The World Business/INSEAD Innovation Index 2007, researched by Professor Soumitra Dutta and sponsored by BT, ranks nations according to their innovation performance. 

It shows the US to be by far the world’s most innovative nation, based on eight categories of evaluation: institutions and policies; infrastructure; human capacity; technological sophistication; and business markets and capital. The study also factors in knowledge, competitiveness and wealth.

The full study is available online from 17 January at worldbusinesslive.com.