Conference Presentation, Fireside Chat, Interview, Panel
A Conversation with Edmund Phelps, Moderated by Peter Passell
- RAND plans to record and potentially distribute public programs as podcasts via rand.org or iTunes to inform dialogue on policy issues, with the next event scheduled for 2014.
- The organization expects its research to influence policy and public perception through the support of the RAND Policy Circle.
- Historical analysis indicates that modern economies functioned well until the mid-20th century, when a severe reaction to traditional corporatist values began to undermine economic culture.
- Individualism and creativity values from the 1490–1940 era are currently threatened by a resurgence of corporatist systems prioritizing the community and state.
- The rate of indigenous innovation in the American economy has declined from approximately 2% per annum between 1922 and 1972 to roughly 1% per annum from the late 1970s onward.
- Innovation has significantly decreased within established American industries dominated by large corporations, whereas California remains an exception due to garage innovators and entertainment sectors.
- American corporate innovation is hindered by duopolies and oligopolists utilizing tax carve-outs and deductions to reduce the necessity for defensive innovation, thereby blocking startup entry.
- A culture of entitlement and fear of failure is spreading among youth, reducing motivation to participate in the business sector.
- China is demonstrating increased grassroots innovation, with preliminary estimates suggesting an indigenous innovation rate of approximately 2% per annum, potentially exceeding the current US rate, though this figure is subject to considerable uncertainty.
- Without addressing social costs associated with conformity and risk aversion, reversing the decline in innovation is unlikely; conversely, celebrating creativity could trigger an economic surge similar to the early modern era.
- Historical precedents show Britain's post-WWII decline in dynamism, Japan's economic collapse in the 1990s after exhausting technological transfer possibilities from the US, and sudden productivity drops in France and Italy around 1998 due to similar saturation of transferable technologies.
- Denmark is identified as a high-dynamism economy, while South Korea exhibits significant dynamism through Samsung, though its level of deep creativity compared to firms like Google remains uncertain.