Launching The Innovation Renaissance: A New Path to Bring Smart Ideas to Market Fast by Alex Tabarrok. Early this year Tyler diagnosed the cancer that crept into our economy and now his co-blogger Alex gives a brilliant remedy. These $2.99 a pop e-books are too small to be called books and too big for an essay. Until someone coins a better term, I am gonna call them Kindlets. Download this Kindlet now to get en-lighted in less than 45 minutes.
On Patent's:
If Edison were to patent the light bulb today, he would not need to go to such lengths. Instead, Edison could patent the use of an "electrical resistor for production of electro-magnetic radiation," a patent that would have covered oven elements as well as light bulbs.
In fact, something like this almost happened. William Edward Sawyer and Albon Man patented a light bulb prior to Edison and claimed the rights to any light bulb using a filament of "fibrous or textile material," which certainly covered bamboo. The Supreme court however, rejected these claims because Sawyer and Man had not invested the sunk costs necessary to discover that bamboo would in fact work as a filament.
In addition to often being unnecessary, patents can reduce innovation. In many industries, innovation is a cumulative process with new innovations building on older innovations. The problem is that under a strong patent regime, old innovators can block new competitors. Instead of promoting innovation, patents have become a way to veto innovations.
Today it is not necessary to implement an idea to patent it, and many patentable ideas are so broadly phrased that they could not be implemented in a model.
In fact, something like this almost happened. William Edward Sawyer and Albon Man patented a light bulb prior to Edison and claimed the rights to any light bulb using a filament of "fibrous or textile material," which certainly covered bamboo. The Supreme court however, rejected these claims because Sawyer and Man had not invested the sunk costs necessary to discover that bamboo would in fact work as a filament.
In addition to often being unnecessary, patents can reduce innovation. In many industries, innovation is a cumulative process with new innovations building on older innovations. The problem is that under a strong patent regime, old innovators can block new competitors. Instead of promoting innovation, patents have become a way to veto innovations.
Today it is not necessary to implement an idea to patent it, and many patentable ideas are so broadly phrased that they could not be implemented in a model.
On Prizes vs Grants:
The big advantage of prizes over grants is that prizes are open. To give a grant, the grant givers must figure our who is most likely to solve the problem. But how can grant givers predict the most likely solver if they don't already know quite a bit about the solution? When the space of possible solution is large it makes sense to broadcast the problem and have the solvers come to you.
On Education:
In 2009 the U.S. graduated 37,994 students with bachelor's degree in computer and information science. Not bad, but here is the surprise: We graduated more students with computer science degree 25 years ago! In comparison, the U.S. graduated 89,140 students in the visual and performing arts in 2009 - more than double the number of 25 year ago!
Bear in mind that over the past 25 years the total number of students in college has increased by about 50% so the number of graduates in science, technology, engineering and mathematics has stagnated even as the total number of students has increased.
Bear in mind that over the past 25 years the total number of students in college has increased by about 50% so the number of graduates in science, technology, engineering and mathematics has stagnated even as the total number of students has increased.
On Immigration:
We also should create a straightforward route to permanent residency for foreign-born students who graduate with advance degree from American universities, particularly in the fields of science, technology, engineering and mathematics. We educate some of the best and the brightest students in the world in our universities and then on graduation day we tell them, "Thanks for visiting. Now go home!" It's hard to imagine a more shortsighted policy to reduce America's capacity for innovation.
I focus on high-skill immigration by the way, because this policy ought to receive widespread agreement, not because low-skill immigration does not also have advantages. Low-skill immigration can even increase innovation because it helps highly skilled workers to better use their time and skills. A low-skilled worker who mows a physicist's lawn is indirectly helping to unlock the mysteries of the universe. In fact, over the last several decades, the states with greatest low-skilled immigration have seen greater increases in innovation (total factor productivity) than the states with less immigration.
I focus on high-skill immigration by the way, because this policy ought to receive widespread agreement, not because low-skill immigration does not also have advantages. Low-skill immigration can even increase innovation because it helps highly skilled workers to better use their time and skills. A low-skilled worker who mows a physicist's lawn is indirectly helping to unlock the mysteries of the universe. In fact, over the last several decades, the states with greatest low-skilled immigration have seen greater increases in innovation (total factor productivity) than the states with less immigration.
On Deficit:
Together the warfare and welfare states, counting only the big four of defense, Medicaid, Medicare and Social Security, eat up $2.2 trillion, or nearly two-thirds of U.S. federal budget. In contrast the National Institutes of Health, which funds medical research, spends $31 billion annually, and the National Science Foundation spends about $7 billion.
Indeed the top seven busiest airports are all in the United States, not so much because we are big, but because without new construction we are forced to overcrowd our existing infrastructure. The result is delays and inefficiency. Meanwhile, China is building 50 to 100 new airports over the next 10 years.
On Developing Countries:
The past failures of China, India and other developing economies to contribute to world innovation has been a tragedy. If we think of the world population as a giant parallel processor for producing innovation, then billions of pf processors have been offline for the past several hundred years. But those processors are now coming online. The number of idea creators around the world is increasing rapidly, and in 2007, nearly one-quarter of the world research and development expenditures came from the developing world.
I see two views of humanity. In the first view, people are stomachs. More people mean more eaters and less for everyone else. In the second view, people are brains. More brains mean more ideas and more for everyone else. The two different perspectives are not just matter of ideology or mood. We can look for evidence for or against these views. At the broadest level the evidence for the second perspective is quite strong.
I see two views of humanity. In the first view, people are stomachs. More people mean more eaters and less for everyone else. In the second view, people are brains. More brains mean more ideas and more for everyone else. The two different perspectives are not just matter of ideology or mood. We can look for evidence for or against these views. At the broadest level the evidence for the second perspective is quite strong.
"If nature has made any one thing less susceptible than all others of exclusive property, it is the action of the thinking power called an idea, which an individual may exclusively possess as long as he keeps it to himself; but the moment it is divulged, it forces itself into the possession of every one, and the receiver cannot dispossess himself of it. Its peculiar character, too, is that no one possesses the less, because every other possesses the whole of it. He who receives an idea from me, receives instruction himself without lessening mine; as he who lights his taper at mine, receives light without darkening me. That ideas should freely spread from one to another over the globe, for the moral and mutual instruction of man, and improvement of his condition, seems to have been peculiarly and benevolently designed by nature, when she made them, like fire, expansible over all space, without lessening their density in any point, and like the air in which we breathe, move, and have our physical being, incapable of confinement or exclusive appropriation. Inventions then cannot, in nature, be a subject of property. Society may give an exclusive right to the profits arising from them, as an encouragement to men to pursue ideas which may produce utility, but this may or may not be done, according to the will and convenience of the society, without claim or complaint from any body. Accordingly, it is a fact, as far as I am informed, that England was, until we copied her, the only country on earth which ever, by a general law, gave a legal right to the exclusive use of an idea. In some other countries it is sometimes done, in a great case, and by a special and personal act, but, generally speaking, other nations have thought that these monopolies produce more embarrassment than advantage to society; and it may be observed that the nations which refuse monopolies of invention, are as fruitful as England in new and useful devices."
-Thomas Jefferson, Letter to Isaac McPherson, August 13, 1813
-Thomas Jefferson, Letter to Isaac McPherson, August 13, 1813
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