[BjoernKW]

I'm not sure you can say that most major technological developments come out of Silicon Valley. Perhaps the most obviously world-changing ones do but the majority of technological development still happens outside of Silicon Valley. Even if you just look at the software industry, where Silicon Valley clearly is leading, the majority of software is still developed outside of Silicon Valley. When considering other industries and disciplines this becomes even more obvious.

Regarding the entrepreneurial itch the same thing has been said about the US in general in the past. People elsewhere are just as smart and can be just as entrepreneurially-minded it's often just that the environment doesn't easily accommodate this drive (e.g. lack of adequate infrastructure or conditions not as amenable to entrepreneurship).

However, with the world becoming ever more connected and networked there is no good reason (other than VCs with ulterior motives as mentioned in the other comments) why people from different parts of the world shouldn't collaborate on new projects and ideas. In fact, this stubborn insistence on location might exactly be what's holding further innovation and entrepreneurship back because it excludes a huge number of people from taking part.

[ashwinaj]

That's true. I didn't mean measure it by lines of code but more by impact and forward thinking.

Despite the connectedness and networking in the other parts of the world, I'm yet to see anything world changing come out from elsewhere. It seems everyone outside the US is just reshashing what's being done in the US (social media, networks, taxi apps, what have you in emerging markets). And my argument is that it is the environment of Silicon Valley that facilitates this enterpreneurship and is hard to replicate elsewhere (yet).