{"id":196,"date":"2026-05-04T10:54:53","date_gmt":"2026-05-04T14:54:53","guid":{"rendered":"https:\/\/people.bsu.edu\/econbriefs\/?p=196"},"modified":"2026-05-04T10:54:53","modified_gmt":"2026-05-04T14:54:53","slug":"sustaining-innovation-mokyr-on-growth-and-its-risks-by-dr-cecil-bohanon-and-dr-john-horowitz","status":"publish","type":"post","link":"https:\/\/people.bsu.edu\/econbriefs\/2026\/05\/04\/sustaining-innovation-mokyr-on-growth-and-its-risks-by-dr-cecil-bohanon-and-dr-john-horowitz\/","title":{"rendered":"Sustaining Innovation: Mokyr on Growth and Its Risks\u2013 by Dr. Cecil Bohanon and Dr. John Horowitz"},"content":{"rendered":"<p><span data-contrast=\"auto\">Joel Mokyr, Philippe Aghion, and Peter Howitt won the 2025 Sveriges Riksbank Prize in Economic Science (Nobel Prize in Economics).\u00a0We focus on Mokyr\u2019s talk, \u201c<\/span><a href=\"https:\/\/www.nobelprize.org\/prizes\/economic-sciences\/2025\/mokyr\/lecture\/\"><span data-contrast=\"none\">The Past and Future of Innovation: Can Progress be sustained?<\/span><\/a><span data-contrast=\"auto\">\u201d Mokyr\u00a0won\u00a0&#8220;<\/span><a href=\"http:\/\/nobelprize.org\/prizes\/economic-sciences\/2025\/summary\/\"><span data-contrast=\"none\">for having identified the prerequisites for sustained growth through technological progress&#8221;.<\/span><\/a><span data-ccp-props=\"{}\">\u00a0<\/span><\/p>\n<p><span data-contrast=\"auto\">Mokyr points out that in\u00a0introductory\u00a0economics classes, we\u00a0introduce the topic of\u00a0diminishing returns.\u00a0Diminishing returns means that as you use more and more of an input, the increase in output increases at\u00a0a\u00a0smaller and smaller rate. Likewise, the\u00a0gains from the\u00a0invention of a new technology\u00a0are subject to diminishing returns.\u00a0Long-term economic growth, therefore,\u00a0depends on constantly discovering and implementing new technologies.\u00a0<\/span><span data-ccp-props=\"{}\">\u00a0<\/span><\/p>\n<p><span data-contrast=\"auto\">Since the 1750s, when the Industrial Revolution began, many people\u00a0have thought\u00a0there are only so many ideas to exploit.\u00a0Once you discover and implement indoor plumbing, there are only so many ways to improve it, and the rate of improvement diminishes,\u00a0limiting growth potential. However,\u00a0Mokyr is very optimistic about technological innovation, arguing \u201c<\/span><a href=\"https:\/\/www.nobelprize.org\/prizes\/economic-sciences\/2025\/mokyr\/lecture\/\"><span data-contrast=\"none\">you ain\u2019t seen nothing yet, and the best is still to come<\/span><\/a><span data-contrast=\"auto\">.\u201d\u00a0However,\u00a0he admits that he could be wrong.\u00a0<\/span><span data-ccp-props=\"{}\">\u00a0<\/span><\/p>\n<p><span data-contrast=\"auto\">He notes that new tools and instruments lead to new scientific advances. For example, the development and improvement of microscopes were crucial for advancing medical knowledge by enabling clear visualization of cells, tissue structure, and bacteria, and, in turn, developing new theories, such as the germ theory of disease.\u00a0Today, we have vastly better and newer\u00a0tools, such as microscopes, telescopes, computers, and lasers.\u00a0\u00a0<\/span><span data-ccp-props=\"{}\">\u00a0<\/span><\/p>\n<p><span data-contrast=\"auto\">He asked, \u201cWhat can go wrong?\u201d\u00a0Innovation depends on institutions, and he identifies four crucial conditions for innovation. First, incentives for inventors and innovators to invent\u00a0without being threatened for challenging conventional wisdom or for being eccentric or contrarian.\u00a0Second, an open and free market for ideas where no entity has too much market power. Third, creative and innovative thinkers\u00a0can\u00a0move wherever they choose and be most productive. All three Nobel Prize winners this year were born outside the US and did most of their work in the US. Fourth, a government that is not too controlling or too\u00a0absent. Like\u00a0Goldilocks, some regulation but not too much.\u00a0<\/span><span data-ccp-props=\"{}\">\u00a0<\/span><\/p>\n<p><span data-contrast=\"auto\">He notes\u00a0that our national debt or aging population are not our most serious risks, but rather our increasingly fragmented world, people&#8217;s fear of immigration, and anti-intellectualism toward new ideas.\u00a0He ended by quoting\u00a0Friedrich Schiller, \u201cAgainst stupidity, the gods themselves contend in vain.\u201d\u00a0<\/span><span data-ccp-props=\"{}\">\u00a0<\/span><\/p>\n","protected":false},"excerpt":{"rendered":"<p>Joel Mokyr, Philippe Aghion, and Peter Howitt won the 2025 Sveriges Riksbank Prize in Economic Science (Nobel Prize in Economics).\u00a0We focus on Mokyr\u2019s talk, \u201cThe Past and Future of Innovation: Can Progress be sustained?\u201d Mokyr\u00a0won\u00a0&#8220;for having identified the prerequisites for sustained growth through technological progress&#8221;.\u00a0 Mokyr points out that in\u00a0introductory\u00a0economics classes, we\u00a0introduce the topic of\u00a0diminishing [&hellip;]<\/p>\n","protected":false},"author":112,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[85],"tags":[1725,757,739,411,783,1642,1726,1727,1728,1724],"class_list":["post-196","post","type-post","status-publish","format-standard","hentry","category-macroeconomics","tag-diminishing-returns","tag-economic-development","tag-economic-growth","tag-immigration","tag-industrial-revolution","tag-institutions","tag-joel-mokyr","tag-knowledge-economy","tag-market-for-ideas","tag-technological-innovation"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v27.6 - 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