Growth in technology innovation typically happens via

The competitiveness of the U.S. economy depends on technological progress, but recent data suggests that innovation is getting harder and the pace of growth is slowing down. A major challenge in business and policy spheres is to understand the environments that are most conducive to innovation. One way to do that is to look to history. In The golden age is associated with some of America’s leading technology pioneers, such asThomas Edison and Nikola Tesla in electrical illumination and Alexander Graham Bell and Elisha Gray in telephony. Our analysis goes beyond these well-known individuals. We built a systematic data set that contains millions of patented inventions and millions of individuals in Federal Censuses from1880 to1940. We also linked patent data to state- and country-level information. By analyzing this data, we were able toshed light on why the U.S. was so innovative. The context for technological development was very different a century ago. For instance, in 1880 most inventive activity was the result of inventors operating outside the boundaries of firms. Research laboratories, such as the famous one opened, in 1876, by Thomas Edison in Menlo Park, New Jersey, were rare. From the middle of the 20thcentury, however, the modern corporation started to dominate patenting. By 2000 almost 80% of patents were assigned to inventors associated with firms. Nevertheless, the impact of innovation on economic growth was typically large. The chart below illustrates a stron...

Zia Qureshi Senior Fellow - Three basic ingredients drive economic growth—productivity, capital, and labor. All three are facing new challenges in a changing context. Foremost among the drivers of change has been technology, spearheaded by digital transformation. Slowdown in productivity and investment Productivity is the main long-term propeller of economic growth. Technology-enabled innovation is the major spur to productivity growth. Yet, paradoxically, productivity growth has slowed as digital technologies have boomed. Among advanced economies over the past 15 years or so, it has averaged less than half of the pace of the previous 15 years. Firms at the technological frontier have reaped major productivity gains, but the impact on productivity more widely across firms has been weak. The new technologies have tended to produce winners-take-most outcomes. Dominant firms have acquired more market power, market structures have become less competitive, and business dynamism has declined. Investment also has been weak in most major economies. The persistent weakness of investment despite historically low interest rates has prompted concerns about the risk of “secular stagnation.” Weak productivity growth and investment have reinforced each other and are linked by similar shifts in market structures and dynamics. Sinem Kilic Celik, M. Ayhan Kose, and Franziska Ohnsorge Thursday, February 27, 2020 Shifts in labor markets Technology is having profound effects on labor markets. ...

(PDF-310 KB) It’s no secret: innovation is difficult for well-established companies. By and large, they are better executors than innovators, and most succeed less through game-changing creativity than by optimizing their existing businesses. Yet hard as it is for such organizations to innovate, large ones as diverse as Alcoa, the Discovery Group, and NASA’s Ames Research Center are actually doing so. What can other companies learn from their approaches and attributes? That question formed the core of a multiyear study comprising in-depth interviews, workshops, and surveys of more than 2,500 executives in over 300 companies, including both performance leaders and laggards, in a broad set of industries and countries (Exhibit 1). What we found were a set of eight essential attributes that are present, either in part or in full, at every big company that’s a high performer in product, process, or business-model innovation. Since To be sure, there’s no proven formula for success, particularly when it comes to innovation. While our years of client-service experience provide strong indicators for the existence of a causal relationship between the attributes that survey respondents reported and the innovations of the companies we studied, the statistics described here can only prove correlation. Yet we firmly believe that if companies assimilate and apply these essentials—in their own way, in accordance with their particular context, capabilities, organizational culture, and appe...

License and Republishing World Economic Forum articles may be republished in accordance with the Creative Commons Attribution-NonCommercial-NoDerivatives 4.0 International Public License, and in accordance with our Terms of Use. The views expressed in this article are those of the author alone and not the World Economic Forum.

At the same time, the experts responding to questions about civic and social innovations also foresee scores of innovations between now and 2030 that they think might ease some problems. This chapter covers some of the key open-ended answers they offered, organized in 10 broad themes. It includes comments made by an array of respondents, regardless of their responses to our main question about the impact of technology on innovation by 2030. Social media: Experts see a reckoning coming for social platform companies and leaders that will lead to large-scale changes A portion of the experts in this canvassing suggest there will be changes in the overall environment of social media during the next decade. Some say there will be a reckoning for technology companies and their leaders that might produce major revisions to their platforms. Some expect serious efforts to break up such firms, and some predict the rise of new platforms designed to make their users’ best interests paramount. Sam Adams, a 24-year veteran of IBM now working as a senior research scientist in artificial intelligence for RTI International, architecting national-scale knowledge graphs for global good, said, “I do expect new social platforms to emerge that focus on privacy and ‘fake-free’ information, or at least they will claim to be so. Proving that to a jaded public will be a challenge. Resisting the temptation to exploit all that data will be extremely hard. And how to pay for it all? If it is subscriber...

The competitiveness of the U.S. economy depends on technological progress, but recent data suggests that innovation is getting harder and the pace of growth is slowing down. A major challenge in business and policy spheres is to understand the environments that are most conducive to innovation. One way to do that is to look to history. In The golden age is associated with some of America’s leading technology pioneers, such asThomas Edison and Nikola Tesla in electrical illumination and Alexander Graham Bell and Elisha Gray in telephony. Our analysis goes beyond these well-known individuals. We built a systematic data set that contains millions of patented inventions and millions of individuals in Federal Censuses from1880 to1940. We also linked patent data to state- and country-level information. By analyzing this data, we were able toshed light on why the U.S. was so innovative. The context for technological development was very different a century ago. For instance, in 1880 most inventive activity was the result of inventors operating outside the boundaries of firms. Research laboratories, such as the famous one opened, in 1876, by Thomas Edison in Menlo Park, New Jersey, were rare. From the middle of the 20thcentury, however, the modern corporation started to dominate patenting. By 2000 almost 80% of patents were assigned to inventors associated with firms. Nevertheless, the impact of innovation on economic growth was typically large. The chart below illustrates a stron...

At the same time, the experts responding to questions about civic and social innovations also foresee scores of innovations between now and 2030 that they think might ease some problems. This chapter covers some of the key open-ended answers they offered, organized in 10 broad themes. It includes comments made by an array of respondents, regardless of their responses to our main question about the impact of technology on innovation by 2030. Social media: Experts see a reckoning coming for social platform companies and leaders that will lead to large-scale changes A portion of the experts in this canvassing suggest there will be changes in the overall environment of social media during the next decade. Some say there will be a reckoning for technology companies and their leaders that might produce major revisions to their platforms. Some expect serious efforts to break up such firms, and some predict the rise of new platforms designed to make their users’ best interests paramount. Sam Adams, a 24-year veteran of IBM now working as a senior research scientist in artificial intelligence for RTI International, architecting national-scale knowledge graphs for global good, said, “I do expect new social platforms to emerge that focus on privacy and ‘fake-free’ information, or at least they will claim to be so. Proving that to a jaded public will be a challenge. Resisting the temptation to exploit all that data will be extremely hard. And how to pay for it all? If it is subscriber...

Zia Qureshi Senior Fellow - Three basic ingredients drive economic growth—productivity, capital, and labor. All three are facing new challenges in a changing context. Foremost among the drivers of change has been technology, spearheaded by digital transformation. Slowdown in productivity and investment Productivity is the main long-term propeller of economic growth. Technology-enabled innovation is the major spur to productivity growth. Yet, paradoxically, productivity growth has slowed as digital technologies have boomed. Among advanced economies over the past 15 years or so, it has averaged less than half of the pace of the previous 15 years. Firms at the technological frontier have reaped major productivity gains, but the impact on productivity more widely across firms has been weak. The new technologies have tended to produce winners-take-most outcomes. Dominant firms have acquired more market power, market structures have become less competitive, and business dynamism has declined. Investment also has been weak in most major economies. The persistent weakness of investment despite historically low interest rates has prompted concerns about the risk of “secular stagnation.” Weak productivity growth and investment have reinforced each other and are linked by similar shifts in market structures and dynamics. Sinem Kilic Celik, M. Ayhan Kose, and Franziska Ohnsorge Thursday, February 27, 2020 Shifts in labor markets Technology is having profound effects on labor markets. ...

License and Republishing World Economic Forum articles may be republished in accordance with the Creative Commons Attribution-NonCommercial-NoDerivatives 4.0 International Public License, and in accordance with our Terms of Use. The views expressed in this article are those of the author alone and not the World Economic Forum.

(PDF-310 KB) It’s no secret: innovation is difficult for well-established companies. By and large, they are better executors than innovators, and most succeed less through game-changing creativity than by optimizing their existing businesses. Yet hard as it is for such organizations to innovate, large ones as diverse as Alcoa, the Discovery Group, and NASA’s Ames Research Center are actually doing so. What can other companies learn from their approaches and attributes? That question formed the core of a multiyear study comprising in-depth interviews, workshops, and surveys of more than 2,500 executives in over 300 companies, including both performance leaders and laggards, in a broad set of industries and countries (Exhibit 1). What we found were a set of eight essential attributes that are present, either in part or in full, at every big company that’s a high performer in product, process, or business-model innovation. Since To be sure, there’s no proven formula for success, particularly when it comes to innovation. While our years of client-service experience provide strong indicators for the existence of a causal relationship between the attributes that survey respondents reported and the innovations of the companies we studied, the statistics described here can only prove correlation. Yet we firmly believe that if companies assimilate and apply these essentials—in their own way, in accordance with their particular context, capabilities, organizational culture, and appe...