Abstract
Using a data set of highly cited researchers in all fields of science, we show that the gapin scientific performance between Europe, especially continental Europe, and the USAis large. We model the number of highly cited researchers in a sample of countries as afunction of physical and human capital and a country-specific, factor-augmentingHicks-neutral productivity term. We find that differences in productivity betweenAnglo-Saxon countries and other countries are not solely due to differences in the levelsof inputs. Not surprisingly, our results reveal the importance of English proficiency.However, they also show that the governance and design of research institutions thatcharacterize Anglo-Saxon countries, as well as a few other countries that have similarinstitutions, is another critical factor for research output.