The Changing Structure of American Innovation: Some Cautionary Remarks for Economic Growth

53 Pages Posted: 5 Jun 2019

See all articles by Ashish Arora

Ashish Arora

Duke University - Fuqua School of Business; National Bureau of Economics Research; Duke Innovation & Entrepreneurship Initiative

Sharon Belenzon

Duke University; NBER; Duke Innovation & Entrepreneurship Initiative

Andrea Patacconi

University of East Anglia (UEA) - Norwich Business School

Jungkyu Suh

Duke University

Date Written: May 2019

Abstract

A defiining feature of modern economic growth is the systematic application of science to advance technology. However, despite sustained progress in scientific knowledge, recent productivity growth in the U.S. has been disappointing. We review major changes in the American innovation ecosystem over the past century. The past three decades have been marked by a growing division of labor between universities focusing on research and large corporations focusing on development. Knowledge produced by universities is not often in a form that can be readily digested and turned into new goods and services. Small firms and university technology transfer offices cannot fully substitute for corporate research, which had integrated multiple disciplines at the scale required to solve significant technical problems. Therefore, whereas the division of innovative labor may have raised the volume of science by universities, it has also slowed, at least for a period of time, the transformation of that knowledge into novel products and processes.

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Suggested Citation

Arora, Ashish and Belenzon, Sharon and Patacconi, Andrea and Suh, Jungkyu, The Changing Structure of American Innovation: Some Cautionary Remarks for Economic Growth (May 2019). NBER Working Paper No. w25893. Available at SSRN: https://ssrn.com/abstract=3398063

Ashish Arora (Contact Author)

Duke University - Fuqua School of Business ( email )

Box 90120
Durham, NC 27708-0120
United States

National Bureau of Economics Research

1050 Massachusetts Avenue
Cambridge, MA 02138
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Duke Innovation & Entrepreneurship Initiative ( email )

215 Morris St., Suite 300
Durham, NC 27701
United States

Sharon Belenzon

Duke University ( email )

100 Fuqua Drive
Durham, NC 27708-0204
United States

NBER ( email )

1050 Massachusetts Avenue
Cambridge, MA 02138
United States
(1) 617 588 1484 (Phone)

Duke Innovation & Entrepreneurship Initiative ( email )

215 Morris St., Suite 300
Durham, NC 27701
United States

Andrea Patacconi

University of East Anglia (UEA) - Norwich Business School ( email )

Norwich
NR4 7TJ
United Kingdom

Jungkyu Suh

Duke University ( email )

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