Generativity: Making Law a More Open Institutional 'Ecosystem' for Productive Innovation
17 Pages Posted: 4 Apr 2015 Last revised: 12 May 2015
Date Written: April 2, 2015
Generativity provides a measure of the degree to which a system is open to innovation not necessarily contemplated or understood when the system was created or emerged. In economic analysis, generativity can be distinguished from efficiency as sometimes conflicting goals related to the factors leading to prosperity and growth. The property of generativity in our legal institutions is an important one for increasing the rate of productive innovation, and our laws should be designed with this principle in mind. Generativity does come with potential dangers. Protecting against those dangers, as well as fostering other social goals, will require balancing the institutional factors which promote generativity against those that mitigate risk of harm or that promote social cohesion. Exploring some of the considerations that might weigh in that balancing exercise can inform the debates that swirl around questions of regulation and freedom in our economic life.
Keywords: innovation; growth; institutions; risk
JEL Classification: K19, O31, O33
Suggested Citation: Suggested Citation