Fostering Innovation

Two ways of foster innovation are through the use of think tanks and government investments. 

Think tanks continue to evolve based upon the changing environment the function in and the challenges they attempt to address.  In the 2015 Global Think Tank Innovations Summit several key recommendations were made (McGann, 2015).  The first stressed the importance of think tank networks and associations.  The idea is to affiliate with think tanks tackling similar problems.  This is not surprising as collaboration is becoming increasingly important.  Related to this point, it was stressed that innovations and best practices should be shared.   Think tanks were encouraged to create newsletters as a means of sharing information.  They also encouraged the use of knowledge sharing platforms and to view other thinks tanks as potential partners.  On a practical front, they stress the importance of transparency with regards to funding.  As researchers, disclosing possible conflicts of interest is critical.

Related to the funding of think tanks is the role the government should play in innovation.  Under the neoclassical economic theory, the role of government policy is to correct market failures (Mazzucato, 2015). The thinking is that the government should step in only when there is a failure in the market, such as a monopoly.  The problem with this view is that markets are often short sited. An example of a long-term government investment that has recently paid off is the extraction of natural gas from shale formations.  In 1976, the Eastern Gas Shales Project was launched by Morgantown Energy Research Center and the Bureau of Mines.  Also, in 1976 the federal government formed the Gas Research Institute which was funded by a tax on natural gas production, resulting in billions of dollars being spent researching the extraction process.

Closer to home, or ear, is the technology used in smartphones.  The Internet it connects to exists thanks to the Defense Advanced Research Project Agency’s ARPANET. The GPS it uses to determine location came from a United States military’s Navstar project.  The fingerprint reader is based on technology created by a company founded by a professor who received a grant from the National Science Foundation.

The key takeaway is not that the government should throw money away on pointless research, but rather that it should invest in strategic world-changing research that only it is in a place to bring to fruition.  It is important to notice that the reward is not immediate.  Investments often take decades before a return is seen or before the impact is fully recognized.   The combination of strategic funding of think tanks with direct government facilitation of research could result in significant breakthroughs. Failure to make the investment may not be noticed immediately but will be felt by subsequent generations.

References

Mazzucato, M. (2015). The innovative state. Foreign Affairs, 94(1), 7-8.

McGann, J. G. (2015). 2015 Global Think Tank Innovations Summit Report: The Think Tank of the Future is Here Today.