Innovation has been redefined as the implementation of a new product, process or organization.† Adoption from a developed economy is considered innovation.† The mirror image is that productivity growth accounts not only for technical change, but also efficiency change.† The latter component is more important to developing economies.† R&D pertains more to technical change and competition and free trade to efficiency change.† Empirical studies confirm that R&D is more potent in developed economies and that competition and free trade spur development.