The Benefits of Risky Science
Forthcoming in the Economic Journal
50 Pages Posted: 18 Feb 2010 Last revised: 6 Aug 2015
Date Written: July 2015
When scientists choose research projects that have the highest expected value an externality can appear. Slight variations on existing work will be selected in preference to new lines of research that can, when followed up selectively, generate more expected value over time. New research enjoys two advantages: it is riskier and hence more likely to lead to high-value follow-up projects and it can generate more follow-up projects. Several cures for the externality are analyzed: less communication among scientists, markets for the right to undertake follow-up projects, and the pursuit of citations rather than expected value as a goal for scientists.
Keywords: science, innovation, externalities, citations, trees
JEL Classification: D62, D83, H41, Z19
Suggested Citation: Suggested Citation