California’s San Jose tops the World Knowledge Competitiveness Index (WKCI) for 2005, reflecting an economy within which knowledge is an integral part of production.

The index, produced by Robert Huggins Associates, is a composite and relative measure of the knowledge economies of the world’s best performing regions. It serves as a benchmark of the knowledge capacity, capability and sustainability of each region and the extent to which that knowledge is translated into economic value and transferred into the wealth of the citizens of each region.

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Last year the top 14 positions on the WKCI were taken by US regions, while this year that figure has been reduced to the top seven due to the strong performance of Stockholm, which climbs seven places up to eighth position. Tokyo also improved its ranking considerably, jumping 16 places from the previous year.

But other regions found it difficult to beat those of the US. This year only eight non-US regions broke into the top 50, while the lowest ranked US region is Miami, which comes in at 70th. The UK regions of London and South-east fell out of the top 50, mainly due to a decline in scores for both managers and private equity.

There were some relative changes among regions: Rochester, New York, for example, was fourth in 2003 but has since slipped to ninth place, and Austin, Texas, was in second place in 2003 but this year fell another 10 places and now occupies 19th place. Both regions have suffered significant increases in unemployment recently, resulting in a worsening of performance, and this seems to be indicative of the high level of competition throughout the US, Robert Huggins Associates says in its report on the index.