September 11th was a traumatic event for the psychology of the nation but also for its innovation capacity. After 9/11 the United States started admitting fewer highly skilled immigrants, invited fewer students to come study here, and companies and consumers cut back on their travel budgets.
These factors, along with many others, combined to reduce the amount of face to face collaboration and created new innovation headwinds for the country.
In 2001, Michael Porter of Harvard Business School published a report ranking the United States as #1 in terms of innovative capacity. By 2009,the Economist Intelligence Unit had dropped the United States in its innovation rankings from #3 between 2002 - 2006 to #4 between 2004 - 2008. The most recent Global Innovation Index has the United States falling from #1 in 2009 to #7 in 2011 -- behind Switzerland, Sweden, Singapore, Hong Kong, Finland, and Denmark.
