Today we address one of the critical and key factors of production, it is a factor we have severely neglected addressing earlier in this forum. It is about Innovation.
Our model is broken!
If we investigate some of the underlying factors ‘driving’ this problem, we would point the finger at the social experiments we embarked on over the last two centuries in Europe. The simple fact is that we just did not get on with each other. There are two ways of accumulating wealth very quickly, one of them being to steal it and the other is to trade activity to get it. However, in both choices you side require a lot of the other factors of production, namely land and capital and labour.
If neither of these two options are open to you then you need to follow the slow road of progress. But here is where Innovation comes to the fore as an enabler.
The USA is a far better incubator and fertile soil for entrepreneurial and innovative development.
In Europe we lack the cohesion of two factors that drove American innovation:
(1) A common language (English) and
(2) a common goal (making money).
Irrespective of the language issue, we treat ‘raw’ capitalism with disdain and suspicion in Europe, whereas the States embraces this with open gusto, so much so that the current administration is frustrating its efforts to burst forth once more as a power house of growth.
Now we are not advocating abandoning regulation per se, what we would ideally like to see is innovation in the Regulatory space too, where regulation is thought through on an end to end basis, with due consideration for the law of unintended consequences that knee jerk regulation sets in motion.
So the hope in Europe now is this: We have been building the platform for collaboration for a while now, with the EEC, EC and EU experiments and we now have continuity at the top with an appointed President and Foreign Secretary.
Lets bury the hatchet and utilise the platform of collaboration in order to launch and harness the power of ‘Innovation Incubation’, thereby eliminating the wasted effort and duplication of processes currently taking place and shaping our European hinterland.
Let’s explore these ideas further in future posts.
- These 16 Countries Are Leading European Innovation (businessinsider.com)
- More and Bigger Europe…Is that what we really want? (themarketsoul.com)
- Does Europe have what it takes to be an internet innovator? (cnn.com)
- The New Factors Of Production And the Rise of Data-Driven Applications (forbes.com)
- “Alexander Field, Greg Clark, and Optimism about the Current Unpleasantness” (economistsview.typepad.com)