I think the actual reasons are a lot simpler than some imputed aspect of the British national character. Obviously, struggling to compete with US tech supremacy isn't limited to the UK. Specifically:
1. Outside the USA there's no real culture of granting equity to early stage employees. Interestingly, ARM was one of the very few exceptions. Incentivized and passionate employees are considered non-negotiable for US startups, not so elsewhere.
2. The USA and California specifically has some laws that happen to be really good for founding successful internet startups e.g. banning non-competes, at will employment, the first amendment, and so on. UK and EU have the opposite: lots of laws that make it difficult or risky.
3. The USA benefits from a large internal market with homogenous language and timezones. When British computer companies tried to expand into the USA all kinds of logistical issues got in the way of them scaling up, both in the USA and Europe. It's much easier for a company to get big in the US and then start picking off local markets one by one.
The first two problems often combine. Try setting up an employee equity scheme for a new startup in Europe. You'll find the tax systems often make it absurdly complicated or even impossible, and accountancy/legal firms are usually inexperienced with it. I'm going through this problem right now. I asked for a US style straight equity vesting scheme - no options even - and got back some wacky alternative that involves buyback clauses, contractual promises to continue granting equity even after termination for cause and contains nonsensical statements. Justification is local tax law. Sigh.
Are non-conpetes a violation of free market because they stop employees moving freely to a better job?
Or are they free market in action, becauae thats what employer and employee negotiated?
To the best of my knowledge non-conpetes are illegal in most of europe.