Innovation is a constant subject of my blog entries and articles. In fact, innovation is a constant subject of everyday conversations in the sphere of business. However, an increasing number of economists and technology experts and enthusiasts are developing the idea that innovation might be dying.
In the latest print edition of The Economist, the internationally-recognized business publication ran a story under the title Has the ideas machine broken down?, tackling the debate around the issue whether technological innovation has indeed stopped growing. The feature is mainly concerned about the innovative environment in Silicon Valley, the “capital” of innovative technologies and start-ups. The article voiced the fear that has been creeping into numerous minds: “it seemed the world had run out of ideas”. It also referred to the term coined by economist Tyler Cowen to describe the phenomenon: the Great Stagnation. The article also reveals the three major arguments of “innovation pessimists”: growth statistics, the decreasing number of new inventions and patents, and the general ‘feeling’ of stagnation, as compared with the rapid technological revolution of the early 21 st century.
These points, while valid, point back to the age-old debate between quantity and quality.
Can the rate of innovation be accurately and appropriately measured by using figures alone?
The greatest problem with this innovation debate is probably that it is immensely difficult to measure the impact of technological innovations. Millions of start-ups may be established this year, but we can’t really be certain about to what extent they will make a significant impact in people’s lives.
I am digressing now, however, why I go back to the question: is innovation really stagnant? More importantly, are we facing the end of innovative ideas that used to change how we live by their impact?
Last year, author Stian Westlake wrote in The Guardian, “British innovation is not dead. But it needs public investment to flourish”. The gist of the article is that, like before, innovation still has the potential and capacity to make our lives better and enliven the economy (it might, in fact, hold the same ability for the rest of this generation’s time); but for it to realize this potential, it needs a great amount of support and funding from the government. This is not a novel suggestion. It s an obvious fact that technology needs financial support to flourish; but the problem lies in the fact that most governments tend to veer as far from innovative technological projects as possible. Whether this is caused by fear or by mere doubt in the power of innovation, I don’t know. But what I do know is this: the general indifference and scepticism of governments towards the flourishing world of technology would only lead to the worse. What authorities should realise is that they have a major role to play (if not the most important one) in using the power of innovation to transform lives and economies. As Westlake says, “Governments can make it easier or harder for innovation to flourish.”.
Knut Nylænde is a Norwegian businessman and the incumbent CEO of Moxie AS, a group of investment firms based in Oslo. In KnutNylande.com, Knut writes about his business insights, as well as his opinions in culture and economics.