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Contributed on August 3, 2020

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The ingredients for innovation

Blog: FS - Smart decisions

Inventing new things is hard. Getting people to accept and use new inventions is often even harder. For most people, at most times, technological stagnation has been the norm. What does it take to escape from that and encourage creativity?

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Writing in The Lever of Riches: Technological Creativity and Economic Progress, economic historian Joel Mokyr asks why, when we look at the past, some societies have been considerably more creative than others at particular times. Some have experienced sudden bursts of progress, while others have stagnated for long periods of time. By examining the history of technology and identifying the commonalities between the most creative societies and time periods, Mokyr offers useful lessons we can apply as both individuals and organizations.

What does it take for a society to be technologically creative?

When trying to explain something as broad and complex as technological creativity, it’s important not to fall prey to the lure of a single explanation. There are many possible reasons for anything that happens, and it’s unwise to believe explanations that are too tidy. Mokyr disregards some of the common simplistic explanations for technological creativity, such as that war prompts creativity or people with shorter life spans are less likely to expend time on invention.

Mokyr explores some of the possible factors that contribute to a society’s technological creativity. In particular, he seeks to explain why Europe experienced such a burst of technological creativity from around 1500 to the Industrial Revolution, when prior to that it had lagged far behind the rest of the world. Mokyr explains that “invention occurs at the level of the individual, and we should address the factors that determine individual creativity. Individuals, however, do not live in a vacuum. What makes them implement, improve and adapt new technologies, or just devise small improvements in the way they carry out their daily work depends on the institutions and the attitudes around them.” While environment isn’t everything, certain conditions are necessary for technological creativity.

He identifies the three following key factors in an environment that impact the occurrence of invention and innovation.

The social infrastructure

First of all, the society needs a supply of “ingenious and resourceful innovators who are willing and able to challenge their physical environment for their own improvement.” Fostering these attributes requires factors like good nutrition, religious beliefs that are not overly conservative, and access to education. It is in part about the absence of negative factors—necessitous people have less capacity for creativity. Mokyr writes: “The supply of talent is surely not completely exogenous; it responds to incentives and attitudes. The question that must be confronted is why in some societies talent is unleashed upon technical problems that eventually change the entire productive economy, whereas in others this kind of talent is either repressed or directed elsewhere.”

One partial explanation for Europe’s creativity from 1500 to the Industrial Revolution is that it was often feasible for people to relocate to a different country if the conditions in their current one were suboptimal. A creative individual finding themselves under a conservative government seeking to maintain the technological status quo was able to move elsewhere.

The ability to move around was also part of the success of the Abbasid Caliphate, an empire that stretched from India to the Iberian Peninsula from about 750 to 1250. Economists Maristella Botticini and Zvi Eckstein write in The Chosen Few: How Education Shaped Jewish History, 70–1492 that “it was relatively easy to move or migrate” within the Abbasid empire, especially with its “common language (Arabic) and a uniform set of institutions and laws over an immense area, greatly [favoring] trade and commerce.”

It also matters whether creative people are channeled into technological fields or into other fields, like the military. In Britain during and prior to the Industrial Revolution, Mokyr considers invention to have been the main possible path for creative individuals, as other areas like politics leaned towards conformism.

The social incentives

Second, there need to be incentives in place to encourage innovation. This is of extra importance for macroinventions – completely new inventions, not improvements on existing technology – which can require a great leap of faith. The person who comes up with a faster horse knows it has a market; the one who comes up with a car does not. Such incentives are most often financial, but not always. Awards, positions of power, and recognition also count. Mokyr explains that diverse incentives encourage the patience needed for creativity: “Sustained innovation requires a set of individuals willing to absorb large risks, sometimes to wait many years for the payoff (if any.)”

Patent systems have long served as an incentive, allowing inventors to feel confident they will profit from their work. Patents first appeared in northern Italy in the early fifteenth century; Venice implemented a formal system in 1474. According to Mokyr, the monopoly rights mining contractors received over the discovery of hitherto unknown mineral resources provided inspiration for the patent system.

However, Mokyr points out that patents were not always as effective as inventors hoped. Indeed, they may have provided the incentive without any actual protection. Many inventors ended up spending unproductive time and money on patent litigation, which in some cases outweighed their profits, discouraged them from future endeavors, or left them too drained to invent more. Eli Whitney, inventor of the cotton gin, claimed his legal costs outweighed his profits. Mokyr proposes that though patent laws may be imperfect, they are, on balance, good for society as they incentivize invention while not altogether preventing good ideas from circulating and being improved upon by others.

The ability to make money from inventions is also related to geographic factors. In a country with good communication and transport systems, with markets in different areas linked, it is possible for something new to sell further afield. A bigger prospective market means stronger financial incentives. The extensive, accessible, and well-maintained trade routes during the Abbasid empire allowed for innovations to diffuse throughout the region. And during the Industrial Revolution in Britain, railroads helped bring developments to the entire country, ensuring inventors didn’t just need to rely on their local market.

The social attitude

Third, a technologically creative society must be diverse and tolerant. People must be open to new ideas and outré individuals. They must not only be willing to consider fresh ideas from within their own society but also happy to take inspiration from (or to outright steal) those coming from elsewhere. If a society views knowledge coming from other countries as suspect or even dangerous, unable to see its possible value, it is at a disadvantage. If it eagerly absorbs external influences and adapts them for its own purposes, it is at an advantage. Europeans were willing to pick up on ideas from each other. and elsewhere in the world. As Mokyr puts it, “Inventions such as the spinning wheel, the windmill, and the weight-driven clock recognized no boundaries”

In the Abbasid empire, there was an explosion of innovation that drew on the knowledge gained from other regions. Botticini and Eckstein write:

“The Abbasid period was marked by spectacular developments in science, technology, and the liberal arts. . . . The Muslim world adopted papermaking from China, improving Chinese technology with the invention of paper mills many centuries before paper was known in the West. Muslim engineers made innovate industrial uses of hydropower, tidal power, wind power, steam power, and fossil fuels. . . . Muslim engineers invented crankshafts and water turbines, employed gears in mills and water-raising machines, and pioneered the use of dams as a source of waterpower. Such advances made it possible to mechanize many industrial tasks that had previously been performed by manual labor.”

Within societies, certain people and groups seek to maintain the status quo because it is in their interests to do so. Mokyr writes that “Some of these forces protect vested interests that might incur losses if innovations were introduced, others are simply don’t-rock-the-boat kind of forces.” In order for creative technology to triumph, it must be able to overcome those forces. While there is always going to be conflict, the most creative societies are those where it is still possible for the new thing to take over. If those who seek to maintain the status quo have too much power, a society will end up stagnating in terms of technology. Ways of doing things can prevail not because they are the best, but because there is enough interest in keeping them that way.

In some historical cases in Europe, it was easier for new technologies to spread in the countryside, where the lack of guilds compensated for the lower density of people. City guilds had a huge incentive to maintain the status quo. The inventor of the ribbon loom in Danzig in 1579 was allegedly drowned by the city council, while “in the fifteenth century, the scribes guild of Paris succeeded in delaying the introduction of printing in Paris by 20 years.”

Indeed, tolerance could be said to matter more for technological creativity than education. As Mokyr repeatedly highlights, many inventors and innovators throughout history were not educated to a high level—or even at all. Up until relatively recently, most technology preceded the science explaining how it actually worked. People tinkered, looking to solve problems and experiment.

Unlike modern times, Mokyr explains, for most of history technology did not emerge from “specialized research laboratories paid for by research and development budgets and following strategies mapped out by corporate planners well-informed by marketing analysts. Technological change occurred mostly through new ideas and suggestions occurring if not randomly, then in a highly unpredictable fashion.”

When something worked, it worked, even if no one knew why or the popular explanation later proved incorrect. Steam engines are one such example. The notion that all technologies function under the same set of physical laws was not standard until Galileo.

People need the space to be a bit weird.

Those who were scientists and academics during some of Europe’s most creative periods worked in a different manner than what we expect today, often working on the practical problems they faced themselves. Mokyr gives Galileo as an example, as he “built his own telescopes and supplemented his salary as a professor at the University of Padua by making and repairing instruments.” The distinction between one who thinks and one who makes was not yet clear at the time of the Renaissance. Wherever and whenever making has been a respectable activity for thinkers, creativity flourishes.

Seeing as technological creativity requires a particular set of circumstances, it is not the norm. Throughout history, Mokyr writes, “Technological progress was neither continuous nor persistent. Genuinely creative societies were rare, and their bursts of creativity usually short-lived.”

Not only did people need to be open to new ideas, they also needed to be willing to actually start using new technologies. This often required a big leap of faith. If you’re a farmer just scraping by, trying a new way of ploughing your fields could mean starving to death if it doesn’t work out. Innovations can take a long time to defuse, with riskier ones taking the longest

How can we foster the right environment?

So what can we learn from The Lever of Riches that we can apply as individuals and in organizations?

The first lesson is that creativity does not occur in a vacuum. It requires certain necessary conditions to occur. If we want to come up with new ideas as individuals, we should consider ourselves as part of a system. In particular, we need to consider what might impede us and what can encourage us. We need to eradicate anything that will get in the way of our thinking, such as limiting beliefs or lack of sleep.

We need to be clear on what motivates us to be creative, ensuring what we endeavor to do will be worthwhile enough to drive us through the associated effort. When we find ourselves creatively blocked, it’s often because we’re not in touch with what inspires us to create in the first place.

Within an organization, such factors are equally important. If you want your employees to be creative, it’s important to consider the system they’re part of. Is there anything blocking their thinking? Is a good incentive structure in place (bearing in mind incentives are not solely financial)?

Another lesson is that tolerance for divergence is essential for encouraging creativity. This may seem like part of the first lesson, but it’s crucial enough to consider in isolation.

As individuals, when we seek to come up with new ideas, we need to ask ourselves the following questions: Am I exposing myself to new material and inspirations or staying within a filter bubble? Am I open to unusual ways of thinking? Am I spending too much time around people who discourage deviation from the status quo? Am I being tolerant of myself, allowing myself to make mistakes and have bad ideas in service of eventually having good ones? Am I spending time with unorthodox people who encourage me to think differently?

Within organizations, it’s worth asking the following questions: Are new ideas welcomed or shot down? Is it in the interests of many to protect the status quo? Are ideas respected regardless of their source? Are people encouraged to question norms?

A final lesson is that the forces of inertia are always acting to discourage creativity. Invention is not the natural state of things—it is an exception. Technological stagnation is the norm. In most places, at most times, people have not come up with new technology. It takes a lot for individuals to be willing to wrestle something new from nothing or to question if something in existence can be made better. But when those acts do occur, they can have an immeasurable impact on our world.

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