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The responses in this forum have left me both humbled and hopeful. I will react to the three broad issues they raise.
Several respondents ask us to rethink what exactly innovation and prosperity even are, and the connections (if any) between them (Yuen Yuen Ang; Andrea Jimenez Cisneros and Tony Roberts; Andrew Russell). They call for a fuller exploration of the options for communities in the United States (Russell) and across the globe, especially in less developed countries (Ang; Jimenez Cisneros and Roberts), without imposing our (market-based, Euro-American) ideas of what prosperity is. I fully concur with their views; we should.
In those explorations, though, it is crucial to remember that there are two things innovation is not. It is not invention, and certainly not only the coming up with the latest gadgets and technologies. It is also not the cure for all of humanity’s ills. Innovation, quite simply, is one of the main things that makes us human: the act of taking ideas and actualizing them. Specifically in the case of economics, innovation is the act of performing this actualization across the whole production chain of goods and services (and indeed not only in the private sector), from the first application of a novel technology through to its constant improvement, recombination, repurposing, sale, and service. By remembering that this is innovation, we can also answer the question of why we should care about it: not because it is new, but because without it there will be no improvement to human welfare, period. Indeed, it is much more than improvement of human welfare; it is inherent to human nature. To innovate, in the broadest sense, is to be human.
The problem is that we have become obsessed with a particular, financially driven and inequality-toxic techno-fetishistic idolization of innovation. That is the current manifestation of Silicon Valley, which views only a very small subset of innovation as “real” and melds this narrow view with a worship of quick financial exits. This complete monopoly on the meaning of innovation is apparent even in its most ardent critics (such as Russell in this forum). To get out of this mental cage, we need to not only rethink what innovation is, but more importantly, as Jimenez Cisneros and Roberts ask, envision a model of inclusive prosperity our community can aspire to, and then tailor our innovation-policy as a tool to reach this goal. Too often, as Ang reminds us, policy makers view innovation (defined as what some other place is doing) as the goal, instead of remembering that it is only a tool—a critical one, but just a tool nonetheless.
Relatedly, both Ang and Ro Khanna take issue with my use of the word “production,” which they equate with manufacturing. Khanna reminds us of the reality of the digital revolution, its scale and scope and its importance to the creation of new (hopefully decent-paying) jobs. Ang comes at it from another angle, reminding us that innovators are not only in manufacturing. Farmers in all developing countries innovate all the time, as do workers and distributors in the entertainment industries—for example, in Nigeria, where the Nollywood film industry had become the country’s second-biggest export industry (making Nigeria a brilliant case study of how to strategically innovate around the dysfunctional global IPR regime). Here I will have to admit my failing. I spoke of the production of goods and services, since in my mind that encompasses all those activities in all stages and forms, but rereading my essay I realize I fell into an old linguistic trap and gave examples almost solely drawn from physical production.
With regards to digital jobs, while I agree with Khanna that we should not underestimate the scope and impact of digitization, it is not at all clear that those digital jobs would be good ones, especially in the United States. Without ensuring that our innovation engine does not focus solely on novel innovation, there is a clear risk that our innovators will innovate all skills and all wages away from those new digital jobs. This is exactly what Gabriel Winant, in his new book The Next Shift, demonstrates with the case of the new health care industry in Rust Belt cities. It is not enough to pontificate about and hope for the development of worker-enhancing digital technologies instead of worker-replacing (or probably more accurately wage-, skill-, and job-quality-deflating) technologies. We need to take political and policy actions that ensure U.S. innovators take the high-road in the development of new technologies, and that U.S. businesses follow suit in how they implement new technology throughout the economy in all sectors.
Another set of respondents focuses on the sociopolitics of innovation and local growth. Ben Armstrong reminds us that not all regions have capable institutional leadership able to devise the path forward, and that local politics often end up with an unbalanced representation of specific voices and narrow interests. This is especially true in locales that were once extremely successful. Reynolds Farley demonstrates the acuteness of this issue by reminding us that Detroit seems to finally be on the path to recovery, but ironically only because its bankruptcy allowed it to start from a blank page and construct new public–private–NGO political coalitions to lead it. Last, Josh Whitford reminds us that since innovation, in all its stages, is a social endeavor, we should not forget the need to invest in and sustain its social infrastructure, especially the social networks that are its backbone. Again, I could not agree more. In my own work I have focused on delineating the choices open to communities, and the strategies they can (and should) devise to reach their chosen goal. I have also looked at the role of social networks and other public and semi-public goods, and at various ways to embed local actors, particularly policies aiming to fix network failures. It is clear that much more research needs to be done on how to organize and mobilize local leadership, as well as what kind of local leadership is best suited to the task. Where I personally would like to see this research go further is not just in identifying what forms of leadership work in what contexts and when, but also in how communities can mobilize and organize the right leadership mix for a given task (preferably without the joys of bankruptcy court). It is a critical undertaking, even if it does not fit tidily within any one particular mainstream social science discipline and would thus be hard to pursue within the strictures of the academic tenure process.
I conclude by noting that over all the responses rests the shadow of globalization. For better or worse, we now have a globally fragmented system of production; this is taken as a given but do not as yet truly impact policy decisions. As a result, while everyone pays lip service to globalization, almost all locales—from cities to states to countries—plan as if global trading and production systems still behave as they did in the 1970s. They do not, and it is high time we start to take the fragmentation of production seriously. This means focusing not only on industries, technologies, and sectors, but on what specific stage a particular locale should play at. We need to start focusing on developing stage-specific capabilities instead of thinking about the world as organized into discrete industries. It is eye-opening to me that, even in this forum, we have hardly discussed this issue.
The significant growth of inequality within countries is now one of the defining social and political problems of our time. Additionally, the growth of digital technologies (especially self-automated systems) has so greatly disrupted our work and private lives that communities have been left uncertain about which strategies and innovations will lead toward inclusive prosperity, and which will only point toward greater inequality. Meanwhile, with the decline of manufacturing, it is not clear what paths to growth are still open to less developed countries. And if we are honest, we aren’t even sure how to research those questions properly.
We need forums in which we can engage with each other to create a common language of inquiry—a new subdiscipline, if you will. This is exactly what we are trying to do with the Canadian Institute for Advanced Research’s new research program, Innovation, Equity and the Future of Prosperity. Only by creating collaborative spaces in which engineers, social scientists, historians, philosophers, and law scholars can engage each other and those questions on a sustained basis can we come up with satisfactory answers and help our communities to achieve widespread and sustained prosperity. This forum is only the beginning of a much-needed conversation.
Dan Breznitz is University Professor and Munk Chair of Innovation Studies in the Munk School of Global Affairs & Public Policy at the University of Toronto, where he codirects the Innovation Policy Lab, and author of Innovation in Real Places: Strategies for Prosperity in an Unforgiving World.
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