"Each nation must find the right mix of policies to mobilise the innate innovative and creative potential in their economies."

Switzerland, the United Kingdom, and Sweden topped the rankings, followed by the Netherlands and the United States.

The GII surveys 141 economies around the world, using 79 indicators to gauge both innovative capabilities and measurable results.

While still lagging behind more developed economies, both China (29th) and Malaysia (32nd) made significant gains compared to last year.

China scored particularly well in terms of innovation quality, as measured by university performance, the reach of scholarly articles and the international dimension of patent applications.

"Innovation quality matters. Creating world class universities and investing in research is essential for staying ahead in the global race for successful innovation," the co-authors of the study said in a statement.

The study found that a "well-coordinated innovation policy plan with clear targets and a matching institutional set-up have proven to be a tool for success."