With unemployment north of 10 percent, there is renewed interest in a job creation agenda. But many of the proposals put forth to date overlook two key sources of job growth going forward: exports and innovation.

In this webmemo ITIF senior analyst Daniel Castro and research analyst Scott Andes discuss Fareed Zakaria’s book The Post-American World and dispute his conclusions that the United States has little to worry about in terms of international competition and innovation.

In this report, ITIF outlines the more than $100 billion invested by G-20 countries in IT-related stimulus. While most G-20 countries have passed economic stimulus packages to confront the global economic downturn, more could be done to use IT investments to aid in economic recovery, create jobs, and lay the groundwork for long-term economic benefits.

ITIF Senior Analyst Stephen Ezell’s article, "America and the World: We’re Number 40!", in September’s Democracy Journal examines how the United States has lost its lead in developing innovation policies (and thus risks losing leadership in high-technology innovation), what other countries have done to capture this lead from the United States, and how we can get it back.

Innovation policy tends to get short shrift in Washington. In this article in Democracy: a Journal of Ideas Rob Atkinson argues that perhaps the most fundamental reason for this is that policymakers take their cues on economic policy from the economics profession, and most Washington economists subscribe to the neoclassical economic doctrine that does not understand the importance of innovation and sees almost no role for government in it.

In this NPR post ITIF President Rob Atkinson discusses how higher productivity can not only lead to economic gains but also improve our quality of life by allowing Americans to do more and work less.

A new ITIF report, Effective Corporate Tax Reform in the Global Innovation Economy, examines the issue of corporate tax reform and lays out key principles for policymakers to consider as well as specific policy recommendations for crafting an innovation-based corporate tax code.

Rob Atkinson presentations at the 2009 WFS conference in Chicago.

In this online debate between Iqbal Quadir and ITIF President Rob Atkinson, Atkinson argues that because of United States’ reliance on market forces alone to spur innovation it risks falling behind Asian nations that make innovation a national priority.

In a new report, Structuring U.S. Innovation Policy: Creating a White House Office of Innovation Policy, released today by the Information Technology and Innovation Foundation, Duke Law School professors Stuart Benjamin and Arti Rai propose that the Obama administration (or Congress, if Congress is willing) create an Office of Innovation Policy that would draw upon, and feed into, existing regulatory review processes but would have the specific mission of being the “innovation champion” within these processes.

In this BusinessWeek article ITIF President Rob Atkinson analyzes the cap and trade debate through the lens of the four prevailing economic doctrines in Washington, and argues that an innovation-economics approach to global warming that does not rely just on prices or regulation, but on a proactive “green” innovation strategy is required if we are to successfully reduce our global carbon footprint.

In an article for McKinsey & Company’s book “What Matters: Ten questions that will shape our future” Rob Atkinson and Stephen Ezell examine where the world’s innovation hot spots will be found in the future. They write that the most innovative countries will be those that embrace a model of “innovation economics” that places technology, innovation, and entrepreneurship at the center of economic policymaking, explaining how countries need both competitive market and policy environments to support innovation.

In this report, ITIF & LSE Enterprise estimate the impact on employment in the United Kingdom of additional investment in three important technologies: broadband Internet, intelligent transportation systems, and the smart grid.

The Federal Reserve has reported that household net worth plunged $11.2 trillion in 2008. In this Atlantic article, Rob Atkinson argues that American wealth did not decline, rather all that changed was this: The prices at which American asset owners can sell their assets fell by $11.2 trillion. But the prices that buyers have to pay for those assets also fell by $11.2 trillion. And that’s not necessarily a bad thing. So let’s stop talking about wealth loss, and let’s get to work creating the kind of world we can be proud to pass on to our children.

ITIF uses 16 indicators to assess the global innovation-based competitiveness of 36 countries and 4 regions. This report finds that while the U.S. still leads the EU in innovation-based competitiveness, it ranks sixth overall. Moreover, the U.S. ranks last in progress toward the new knowledge-based innovation economy over the last decade.

In the Fall 2008/2009 issue of the Yale Journal of Law and Technology, ITIF lays out a framework for the new administration’s technology policy to help spur growth and progress throughout the economy and government.

The ideal fiscal stimulus measure not only creates jobs and drives economic activity in the short run but also boosts quality of life and economic growth in the medium and long run. Support for scientific research in the stimulus package accomplishes both goals. In this report, ITIF finds that spurring an additional $20 billion investment in our national research infrastructure will create or retain approximately 402,000 American jobs for one year.

Many forward-thinking countries have made innovation-led economic development a centerpiece of their national economic strategies during the past decade. While many nations have taken the innovation challenge to heart and put in place a host of policies to spur innovation, the United States has done little, consequently falling behind in innovation policies and risking falling behind in innovation performance as well. This article compares U.S. innovation policy to that of other leading industrialized countries across five topic areas: programs to establish civilian technology and innovation promotion agencies; services innovation initiatives; national levels of R&D funding; tax incentives for research and development; and policies regarding high-skill immigration.

This report provides a detailed analysis and estimate of the short-term jobs impacts of using the stimulus package to spur investment in three critical digital networks: broadband, the smart grid and health IT.

If the tectonic economic events of the last few months have shown us anything it’s that many of the core assumptions embedded in the prevailing neoclassical economic doctrine that drives much of Washington’s thinking on economic policy are no longer valid. Moreover, recent theoretical and empirical work has called into question the core tenents of the neo-classical doctrine that markets are stable, are driven by rational actors responding solely to price signals, and require little role for government in driving growth. In this article in The Democracy Journal Rob Atkinson reviews two new books that present important critiques to neo-classical economics: The Gridlock Economy: How Too Much Ownership Wreck Markets, Stops Innovation and Costs Lives by Michael Heller and The Origin of Wealth: Evolution, Complexity and the Radical Remaking of Economics by Eric Beinhocker.

In a report sponsored by the Ewing Marion Kauffman Foundation, ITIF employs 29 indicators to assess the extent to which the 50 state economies are structured according to the tenets of the New Economy. The changing economic landscape requires state economies to be innovative, globally-linked, entrepreneurial and dynamic, with an educated workforce and all sectors embracing the use of information technology. The report, which updates and expands on the 2002 and 2007 State New Economy Index reports, ranks the states accordingly. The five states ranking the highest in 2008 are, in order of rank, Massachusetts, Washington, Maryland, Delaware and New Jersey. With these measures as a frame of reference, the report outlines the next generation of innovative state-level public policies needed to meet the challenges of the New Economy, improve state competitiveness and boost incomes of all Americans.

ITIF President Rob Atkinson asks in his recent Huffington Post blog what will Obamanomics look like? That is to say, in what direction with America’s President-elect lead the nation’s economy? The three contenders are Rubinomics, with its focus on deficit reductions and national savings, Neo-Keynesian, emphasizing social policy such as universal health care and tax cuts for lower and middle class Americans, or Innovation Economics that argues growth is, and always has been, a function of innovation and a robust R&D tax credit along with public-private partnerships are the tools needed to spur such innovation.

Read the full text of the Huffington Post article here

In a new report, Timely, Targeted, Temporary and Transformative: Crafting an Innovation-Based Economic Stimulus Package, ITIF lays out eight specific proposals that would not only spur spending and economic activity in the short run, but also help addresses these challenges going forward.

In this article, ITIF President Rob Atkinson argues that the United States needs to be preparing now for what it will do when the information technology-driven economy begins to become less of an engine for economic growth at some point in the future.

In today’s economy, innovation – the development and adoption of new products and services, more efficient production process­es, and new business models – is the most important factor driv­ing increases in American standards of living. By putting innovation at the center of our nation’s economic policies, we can ensure robust economic growth and rising standards of living for all Americans. ITIF’s Innovation Economics Agenda for the Next Administration lays out eight key recommendations to spur innovation-led economic growth in the United States. Amongst others, these measures include: significantly expanding the federal R&D tax credit, allowing companies to expense new investments in IT in the first year, creating a National Innovation Foundation, and reforming patent and trade policies.

The U.S. political dialogue gives scant attention to innovation and policy to promote innovative activity. This is because the three dominant economic policy models – conservative neoclassical, liberal neoclassical and neo-Keynesian economic doctrines–ignore the role of innovation and technology in achieving economic growth. Fortunately, as described in this policy brief, a new theory and narrative of economic growth called “innovation economics” based on an explicit effort to understand and model how technological advances have emerged in the last decade. This policy brief briefly explains the four economic doctrines and examines how each views particular real-world economic challenges.

Both John McCain and Barack Obama’s campaigns increasingly recognize the central role that science, technology, and innovation play in economic growth and have developed specific policy positions on these issues. This ITIF policy brief compares and assess the candidates’ technology and innovation policies across a number of specific issues areas, including: taxes, R&D funding, broadband and telecommunications, e-government, digital transformation, education and workforce development, trade, patent and intellectual property, and energy and the environment.

In RAND’s Rose-Colored Glasses: How RAND’s Report on U.S. Competitiveness in Science and Technology Gets it Wrong, ITIF presents a detailed critique of the recent RAND report showing that in contrast to RAND’s rosy assessment, America’s lead on a number of key S&T indicators is eroding rapidly, where not vanishing entirely.

For most people, debating economic doctrines is a pastime best left to the Ph.D. economists working in government, think tanks and universities. Yet economic doctrines are at the heart of the economic policies being debated right now in the presidential campaign, in the halls of Congress, and in the current administration. Virtually all policy makers involved in economic policy, including our two major Presidential candidates, subscribe to a particular economic doctrine, even if they may not be aware of which “camp” they are in.

Click here to read the full entry on the Huffington Post

In an interview with the Austin Statesman, ITIF President Rob Atkinson discusses how Innovation Economics is the best approach to economic growth.

ITIF hosted a breakfast forum with Dr. Richard Lipsey that discussed technical change and economic growth. Dr. Lipsey is a Professor Emeritus of Economics at Simon Fraser University and author of the award winning book, Economic Transformation: General Purpose Technologies and Long Term Growth.

In this report, ITIF finds that the nature of the U.S. innovation system has changed dramatically over the course of the last 40 years. Using an innovative research method, UC Davis scholars Fred Block and Mathew Keller analyze a sample of innovations recognized by R&D Magazine as being among the top 100 innovations of the year over the last four decades.

ITIF President Rob Atkinson discusses the issue of traditional economic policy doctrines – supply-side and Keynesian/demand – versus innovation/growth economics with Vinny Catalano, President and Global Investment Strategist of Blue Marble Research.

Despite the fact that most economists agree that increasing productivity is the most important goal for economic policy, few scholars have actually focused on what drives productivity and what governments can do. An exception to this is Bill Lewis, founding director of the McKinsey Global Institute and former partner at McKinsey & Company. At this ITIF Forum, Lewis discusses the results of his research and presents the findings from his book, The Power of Productivity: Wealth, Poverty, and the Threat to Global Stability. See video, presentation slides, and other details from the recent event.

There is disturbing evidence that America’s innovation lead is shrinking. Moreover, expanded support for basic research and science education, while important, will not be enough to respond to this challenge. Without a more robust, targeted, and explicit federal innovation policy, U.S. competitiveness will continue to slip and economic growth will lag. In a new report, the Information Technology and Innovation Foundation and the Brookings Metropolitan Policy Program argue that a critical step in that direction is the establishment of a National Innovation Foundation – a nimble, lean and collaborative entity devoted to supporting firms and other organizations in their innovative activities.

ITIF President Rob Atkinson recently appeared on PBS’s “White House Chronicle,” with host Llewellyn King to discuss the current state and future of technological innovation and its public policy implications.

Click here to see the episode online

Construction costs continue to spiral out of control because the industry has not invested in technology, particularly information technology, to boost productivity. At this event, construction industry expert Barry LePatner will discuss how to fix the problem, including how information technology can play a key role in lowering construction costs and what the federal government can do to help.

ITIF President Rob Atkinson's testimony on the Small Business Administration's investment programs before the House Committee on Small Business.

Rob Atkinson delivers remarks and moderates a discussion between panelists Jeb Bush, Mark Kamlet, John Kelly, Nabil Sakkab, and Sydney Taurel.

In the last few years many have argued that the middle class has not been receiving its fair share of productivity income growth. As a result, the focus of many, particularly those on the left, has shifted from promoting productivity growth to redistribution as a way to raise living standards for this group of Americans. A new ITIF paper examines carefully the trends over the last 25 years in income growth and finds that, contrary to the conventional explanation embraced by many on the left, the historical link between productivity growth and wage growth is not broken and it would be a grave mistake for our future if our nation gave up on growth and the policies that can spur it.

There have been surprisingly few attempts to catalogue what is known about the economic impact of information and communications technology (IT). In a new report, ITIF does just that, examining the impact of IT in five key areas: 1) productivity; 2) employment; 3) more efficient markets; 4) higher quality goods and services; and 5) innovation and new products and services. The report finds that the integration of IT into virtually all aspects of the economy and society is creating a digitally-enabled economy that is responsible for generating the lion’s share of economic growth and prosperity, both here and abroad, including in developing nations. Importantly, the “IT engine” does not appear likely to run out of gas anytime soon and should power robust growth for at least the next decade, provided that policy makers take the right steps. Toward that end the report lays out five key public policy principles for driving digital prosperity: 1) give the digital economy its due; 2) actively encourage digital innovation and transformation of economic sectors; 3) use the tax code to spur IT investment; 4) encourage universal digital literacy and adoption; and 5) do no harm.

In a report sponsored by the Ewing Marion Kauffman Foundation, ITIF employs 26 indicators to assess the extent to which the 50 state economies are structured according to the tenets of the New Economy. The changing economic landscape requires state economies to be innovative, globally-linked, entrepreneurial and dynamic, with an educated workforce and all sectors embracing the use of information technology. The report, which updates and expands on the 2002 State New Economy Index, ranks the states accordingly. The five states ranking the highest in 2007 are, in order of rank, Massachusetts, New Jersey, Maryland, Washington, and California. With these measures as a frame of reference, the report then outlines the next generation of innovative state-level public policies needed to meet the challenges of the New Economy and boost incomes of all Americans.

Presentation at the 2006 Accelerating Innovation Conference in Washington, DC.

Download the slides of this presentation (PDF)

The Past and Future of America’s Economy focuses on how periodic cycles of technological and economic change have fundamentally reordered the way we work, the organization of business and markets, and the role of government. It examines this process of change over the past 150 years and explores the responses of people and institutions. The book then analyzes today’s New Economy, including the new information technology system, and effects on markets, organizations, workers, and governance. Taking into account the historical record, the book discusses the shortcomings of prevailing liberal and conservative economic doctrines and lays out a new growth economics agenda aimed at maximizing the productivity and innovation-enhancing forces of the New Economy.