New New Things
Power, Stability of Power, and Creativity
Daniel Sligte, Carsten de Dreu & Bernard Nijstad
Journal of Experimental Social Psychology, forthcoming
Abstract:
Power hierarchies are an essential aspect of social organization, create stability and social order, and provide individuals with incentives to climb the hierarchical ladder. Extending previous work on power and creativity, we put forward that this relationship critically depends on both the stability of the power hierarchy and the relevance of creative efforts to power. Across three experiments, we show that when power positions are unstable, low power individuals are more flexible thinkers, are less avoidant and process information more globally. Consequently, they achieve more creative insights, especially when being creative is relevant to power. As such, when the power hierarchy is unstable, those lacking power hold the power to creativity.
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Diversity and Technological Progress
Daron Acemoglu
NBER Working Paper, April 2011
Abstract:
This paper proposes a tractable model to study the equilibrium diversity of technological progress and shows that equilibrium technological progress may exhibit too little diversity (too much conformity), in particular, foregoing socially beneficial investments in "alternative" technologies that will be used at some point in the future. The presence of future innovations that will replace current innovations imply that social benefits from innovation are not fully internalized. As a consequence, the market favors technologies that generate current gains relative to those that will bear fruit in the future; current innovations in research lines that will be profitable in the future are discouraged because current innovations are typically followed by further innovations before they can be profitably marketed. A social planner would choose a more diverse research portfolio and would induce a higher growth rate than the equilibrium allocation. The diversity of researchers is a partial (imperfect) remedy against the misallocation induced by the market. Researchers with different interests, competences or ideas may choose non-profit maximizing and thus more diverse research portfolios, indirectly contributing to economic growth.
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Evolution and the growth process: Natural selection of entrepreneurial traits
Oded Galor & Stelios Michalopoulos
Journal of Economic Theory, forthcoming
Abstract:
This research suggests that the evolution of entrepreneurial spirit played a significant role in the process of economic development and the dynamics of inequality within and across societies. The study argues that entrepreneurial spirit evolved non-monotonically in the course of human history. In early stages of development, risk-tolerant, growth promoting traits generated an evolutionary advantage and their increased representation accelerated the pace of technological progress and the process of economic development. In mature stages of development, however, risk-averse traits gained an evolutionary advantage, diminishing the growth potential of advanced economies and contributing to convergence in economic growth across countries.
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Expecting innovation: Psychoactive drug primes and the generation of creative solutions
Joshua Hicks et al.
Experimental and Clinical Psychopharmacology, forthcoming
Abstract:
Many individuals expect that alcohol and drug consumption will enhance creativity. The present studies tested whether substance related primes would influence creative performance for individuals who possessed creativity-related substance expectancies. Participants (n = 566) were briefly exposed to stimuli related to psychoactive substances (alcohol, for Study 1, Sample 1, and Study 2; and marijuana, for Study 1, Sample 2) or neutral stimuli. Participants in Study 1 then completed a creative problem-solving task, while participants in Study 2 completed a divergent thinking task or a task unrelated to creative problem solving. The results of Study 1 revealed that exposure to the experimental stimuli enhanced performance on the creative problem-solving task for those who expected the corresponding substance would trigger creative functioning. In a conceptual replication, Study 2 showed that participants exposed to alcohol cues performed better on a divergent thinking task if they expected alcohol to enhance creativity. It is important to note that this same interaction did not influence performance on measures unrelated to creative problem solving, suggesting that the activation of creativity-related expectancies influenced creative performance, specifically. These findings highlight the importance of assessing expectancies when examining pharmacological effects of alcohol and marijuana. Future directions and implications for substance-related interventions are discussed.
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Ralf Meisenzahl & Joel Mokyr
NBER Working Paper, April 2011
Abstract:
During the Industrial Revolution technological progress and innovation became the main drivers of economic growth. But why was Britain the technological leader? We argue that one hitherto little recognized British advantage was the supply of highly skilled, mechanically able craftsmen who were able to adapt, implement, improve, and tweak new technologies and who provided the micro inventions necessary to make macro inventions highly productive and remunerative. Using a sample of 759 of these mechanics and engineers, we study the incentives and institutions that facilitated the high rate of inventive activity during the Industrial Revolution. First, apprenticeship was the dominant form of skill formation. Formal education played only a minor role. Second, many skilled workmen relied on secrecy and first-mover advantages to reap the benefits of their innovations. Over 40 percent of the sample here never took out a patent. Third, skilled workmen in Britain often published their work and engaged in debates over contemporary technological and social questions. In short, they were affected by the Enlightenment culture. Finally, patterns differ for the textile sector; therefore, any inferences from textiles about the whole economy are likely to be misleading.
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Variable Cultural Acquisition Costs Constrain Cumulative Cultural Evolution
Alex Mesoudi
PLoS ONE, March 2011, e18239
Abstract:
One of the hallmarks of the human species is our capacity for cumulative culture, in which beneficial knowledge and technology is accumulated over successive generations. Yet previous analyses of cumulative cultural change have failed to consider the possibility that as cultural complexity accumulates, it becomes increasingly costly for each new generation to acquire from the previous generation. In principle this may result in an upper limit on the cultural complexity that can be accumulated, at which point accumulated knowledge is so costly and time-consuming to acquire that further innovation is not possible. In this paper I first review existing empirical analyses of the history of science and technology that support the possibility that cultural acquisition costs may constrain cumulative cultural evolution. I then present macroscopic and individual-based models of cumulative cultural evolution that explore the consequences of this assumption of variable cultural acquisition costs, showing that making acquisition costs vary with cultural complexity causes the latter to reach an upper limit above which no further innovation can occur. These models further explore the consequences of different cultural transmission rules (directly biased, indirectly biased and unbiased transmission), population size, and cultural innovations that themselves reduce innovation or acquisition costs.
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"Standardized minds" or individuality? Admissions tests and creativity revisited
Stephen Dollinger
Psychology of Aesthetics, Creativity, and the Arts, forthcoming
Abstract:
College Admissions Tests are designed to predict academic achievement but they are often criticized as being biased in favor of selecting students more inclined to superficial learning than creativity. The empirical literature hints that such tests might predict creative outcomes (although not as well achievement), but few studies have considered actual creative products. With a sample of 492 college students, I tested whether scores on the ACT exam were predictive of three measures of creativity obtained several years after the admission test was taken. Openness to experience was used as an additional predictor; academic measures served as comparative outcomes. Self-reported creative accomplishments, judge-rated creative drawings, and judge-rated richness of autobiographical photo essays were all significantly related to the ACT-composite score even when personality was controlled. Reminiscent of the threshold effect, the benefits of increasing cognitive ability seem to taper off at one sigma above the ACT sample mean. These results imply that college admissions tests may indeed predict creative products and socially beneficial creative activities and not merely course grades; thus their use for admissions should not, on average, penalize the most creative students.
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Did Plant Patents Create the American Rose?
Petra Moser & Paul Rhode
NBER Working Paper, April 2011
Abstract:
The Plant Patent Act of 1930 was the first step towards creating property rights for biological innovation: it introduced patent rights for asexually-propagated plants. This paper uses data on plant patents and registrations of new varieties to examine whether the Act encouraged innovation. Nearly half of all plant patents between 1931 and 1970 were for roses. Large commercial nurseries, which began to build mass hybridization programs in the 1940s, accounted for most of these patents, suggesting that the new intellectual property rights may have helped to encourage the development of a commercial rose breeding industry. Data on registrations of newly-created roses, however, yield no evidence of an increase in innovation: less than 20 percent of new roses were patented, European breeders continued to create most new roses, and there was no increase in the number of new varieties per year after 1931.
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Category Assignment and Relatedness in the Group Ideation Process
Jonali Baruah & Paul Paulus
Journal of Experimental Social Psychology, forthcoming
Abstract:
When groups gather to generate creative ideas on a particular topic, they can consider many aspects or components of the problem. Because such a multitude of alternatives can be overwhelming, groups may find it helpful to focus on specific aspects or categories of the problem. However, it is not clear whether it is best for group members to focus on the same components of the problem at the same time or whether it is better for group members to focus on different components of the problem. Furthermore, the impact of this type of focus may depend on the extent to which the different components of the problem are closely related semantically. It may be easier to generate ideas in semantically related areas but semantically unrelated areas may stimulate generation of more creative ideas. The present study provided a comprehensive test of the effects of task components or category assignment and the degree of relatedness of the assigned categories on the creativity of groups. Groups that were jointly assigned a small set of categories to focus on at the beginning of their session generated more ideas, explored more categories and exhibited higher clustering of similar ideas than the groups whose members were assigned their own unique category. The groups assigned with low related categories surveyed more categories than those assigned with categories of high relatedness. This study suggests that interdisciplinary or diverse groups or teams should have some common focus in the initial phase of their creative sessions and focus on unrelated aspects of the problem in this phase.
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The effects of implicit and explicit security priming on creative problem solving
Mario Mikulincer, Phillip Shaver & Eldad Rom
Cognition & Emotion, April 2011, Pages 519-531
Abstract:
Attachment theory is a theory of affect regulation as it occurs in the context of close relationships. Early research focused on regulation of emotions through maintenance of proximity to supportive others (attachment figures) in times of need. Recently, emphasis has shifted to the regulation of emotion, and the benefits of such regulation for exploration and learning, via the activation of mental representations of attachment figures (security priming). We conducted two studies on the effects of implicit and explicit security priming on creative problem solving. In Study 1, implicit security priming (subliminal presentation of attachment figures' names) led to more creative problem solving (compared with control conditions) regardless of dispositional attachment anxiety and avoidance. In Study 2, the effects of explicit security priming (recalling experiences of being well cared for) were moderated by anxiety and avoidance. We discuss the link between attachment and exploration and the different effects of implicit and explicit security priming.
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Altruism and Innovation in Health Care
Anupam Jena, Stéphane Mechoulan & Tomas Philipson
Journal of Law and Economics, August 2010, Pages 497-518
Abstract:
The joint presence of technological change and consumption externalities is central to health care industries around the world, because medical innovation drives the expansion of the health care sector and altruism seems to motivate many public subsidies. Although traditional economic analysis has proposed well-known remedies to deal with consumption externalities and inefficient technological change in isolation, it lacks clear principles for addressing them jointly. We argue that standard remedies to each of the two problems are inadequate. Focusing on U.S. health care, we provide illustrative calculations of the dynamic inefficiency in the level of research and development (R&D) spending when innovators are unable to appropriate the altruistic surplus of nonconsumers. We calibrate that altruistic gains amount to about a quarter of consumer surplus in the baseline scenario and that R&D spending may be underprovided by as much as 60 percent.
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Can Medical Progress be Sustained? Implications of the Link Between Development and Output Markets
Anup Malani & Tomas Philipson
NBER Working Paper, May 2011
Abstract:
Improvements in health have been a major contributor to gains in overall economic welfare. In this paper, we argue that previous economic research on R&D has overlooked an important difference between medical R&D and R&D in other sectors. The health care sector exhibits a unique linkage between product development and output markets. Participants in clinical trials for new medical products are also potential consumers of existing approved medical products. This overlap between input supply and output demand has non-standard effects on innovative returns over time and across geography. First, medical R&D has a self-limiting effect. Contemporary innovation discourages trial participation and slows down development necessary for future innovation. Thus, medical R&D suffers increasing costs over time, driven by improvements in the standard of care. Second, policies that affect output markets, such as universal coverage and price controls, affect the returns to innovation, not only by altering the firm's variable profits, but also by increasing the length and cost of development. Third, the amount of medical R&D in a location is driven, not only by the local relative R&D talent, but also by consumer demographics and output market policies in that location. We provide evidence of the input-output linkage for the break-through HIV therapies introduced in 1996. We document the substantial drop in trial recruitment induced by these new innovations and argue that this has slowed down development and lowered returns to subsequent HIV-related innovations.
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Demystifying Disruption: A New Model for Understanding and Predicting Disruptive Technologies
Ashish Sood & Gerard Tellis
Marketing Science, March-April 2011, Pages 339-354
Abstract:
The failure of firms in the face of technological change has been a topic of intense research and debate, spawning the theory (among others) of disruptive technologies. However, the theory suffers from circular definitions, inadequate empirical evidence, and lack of a predictive model. We develop a new schema to address these limitations. The schema generates seven hypotheses and a testable model relating to platform technologies. We test this model and hypotheses with data on 36 technologies from seven markets. Contrary to extant theory, technologies that adopt a lower attack ("potentially disruptive technologies") (1) are introduced as frequently by incumbents as by entrants, (2) are not cheaper than older technologies, and (3) rarely disrupt firms; and (4) both entrants and lower attacks significantly reduce the hazard of disruption. Moreover, technology disruption is not permanent because of multiple crossings in technology performance and numerous rival technologies coexisting without one disrupting the other. The proposed predictive model of disruption shows good out-of-sample predictive accuracy. We discuss the implications of these findings.
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Power, Status, and Learning in Organizations
Stuart Bunderson & Ray Reagans
Organization Science, forthcoming
Abstract:
This paper reviews the scholarly literature on the effects of social hierarchy - differences in power and status among organizational actors - on collective learning in organizations and groups. We begin with the observation that theories of organization and group learning have tended to adopt a rational system model, a model that emphasizes goal-directed and cooperative interactions between and among actors who may differ in knowledge and expertise but are undifferentiated with respect to power and status. Our review of the theoretical and empirical literatures on power, status, and learning suggests that social hierarchy can complicate a rational system model of collective learning by disrupting three critical learning-related processes: anchoring on shared goals, risk taking and experimentation, and knowledge sharing. We also find evidence to suggest that the stifling effects of power and status differences on collective learning can be mitigated when advantaged actors are collectively oriented. Indeed, our review suggests that higher-ranking actors who use their power and status in more "socialized" ways can play critical roles in stimulating collective learning behavior. We conclude by articulating several promising directions for future research that were suggested by our review.
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Prizes and patents: Using market signals to provide incentives for innovations
V.V. Chari, Mikhail Golosov & Aleh Tsyvinski
Journal of Economic Theory, forthcoming
Abstract:
We consider environments in which agents other than innovator receive the signals about the quality of innovation. We study whether mechanisms can be found which exploit market information to provide appropriate incentives for innovation. If such mechanisms are used, the innovator has incentives to manipulate market signals. We show that if an innovator cannot manipulate market signals, then the efficient levels of innovation can be uniquely implemented without deadweight losses - for example, by using prizes. Patents are necessary if the innovator can manipulate market signals. For an intermediate case of costly signal manipulation, both patents and prizes may be optimal.
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Timothy Bresnahan, Shane Greenstein & Rebecca Henderson
Harvard Working Paper, January 2011
Abstract:
We address a longstanding question about the causes of creative destruction. Dominant incumbent firms, long successful in an existing technology, are often much less successful in new technological eras. This is puzzling, since a cursory analysis would suggest that incumbent firms have the potential to take advantage of economies of scope across new and old lines of business and, if economies of scope are unavailable, to simply reproduce entrant behavior by creating a "firm within a firm." There are two broad streams of explanation for incumbent failure in these circumstances. One posits that incumbents fear cannibalization in the market place, and so under-invest in the new technology. The second suggests that incumbent firms develop organizational capabilities and cognitive frames that make them slow to "see" new opportunities and that make it difficult to respond effectively once the new opportunity is identified. In this paper we draw on two of the most important historical episodes in the history of the computing industry, the introduction of the PC and of the browser, to develop a third hypothesis. Both IBM and Microsoft, having been extremely successful in an old technology, came to have grave difficulties competing in the new, despite some dramatic early success. We suggest that these difficulties do not arise from cannibalization concerns nor from inherited cognitive frames. Instead they reflect diseconomies of scope rooted in assets that are necessarily shared across both businesses. We show that both Microsoft and IBM were initially very successful in creating free standing business units that could compete with entrants on their own terms, but that as the new businesses grew, the need to share key firm level assets imposed significant costs on both businesses and created severe organizational conflict. In IBM and Microsoft's case this conflict eventually led to control over the new business being given to the old and that in both cases effectively crippled the new business.
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Amazon's Mechanical Turk: A New Source of Inexpensive, Yet High-Quality, Data?
Michael Buhrmester, Tracy Kwang & Samuel Gosling
Perspectives on Psychological Science, January 2011, Pages 3-5
Abstract:
Amazon's Mechanical Turk (MTurk) is a relatively new website that contains the major elements required to conduct research: an integrated participant compensation system; a large participant pool; and a streamlined process of study design, participant recruitment, and data collection. In this article, we describe and evaluate the potential contributions of MTurk to psychology and other social sciences. Findings indicate that (a) MTurk participants are slightly more demographically diverse than are standard Internet samples and are significantly more diverse than typical American college samples; (b) participation is affected by compensation rate and task length, but participants can still be recruited rapidly and inexpensively; (c) realistic compensation rates do not affect data quality; and (d) the data obtained are at least as reliable as those obtained via traditional methods. Overall, MTurk can be used to obtain high-quality data inexpensively and rapidly.
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Funding Scientific Knowledge: Selection, Disclosure and the Public-Private Portfolio
Joshua Gans & Fiona Murray
NBER Working Paper, April 2011
Abstract:
This paper examines argues that while two distinct perspectives characterize the foundations of the public funding of research - filling a selection gap and solving a disclosure problem - in fact both the selection choices of public funders and their criteria for disclosure and commercialization shape the level and type of funding for research and the disclosures that arise as a consequence. In making our argument, we begin by reviewing project selection criteria and policies towards disclosure and commercialization (including patent rights) made by major funding organizations, noting the great variation between these institutions. We then provide a model of how selection criteria and funding conditions imposed by funders interact with the preferences of scientists to shape those projects that accept public funds and the overall level of openness in research. Our analysis reveals complex and unexpected relationships between public funding, private funding, and public disclosure of research. We show, for example, that funding choices made by public agencies can lead to unintended, paradoxical effects, providing short-term openness while stifling longer-term innovation. Implications for empirical evaluation and an agenda for future research are discussed.
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How Citation Boosts Promote Scientific Paradigm Shifts and Nobel Prizes
Amin Mazloumian et al.
PLoS ONE, May 2011, e18975
Abstract:
Nobel Prizes are commonly seen to be among the most prestigious achievements of our times. Based on mining several million citations, we quantitatively analyze the processes driving paradigm shifts in science. We find that groundbreaking discoveries of Nobel Prize Laureates and other famous scientists are not only acknowledged by many citations of their landmark papers. Surprisingly, they also boost the citation rates of their previous publications. Given that innovations must outcompete the rich-gets-richer effect for scientific citations, it turns out that they can make their way only through citation cascades. A quantitative analysis reveals how and why they happen. Science appears to behave like a self-organized critical system, in which citation cascades of all sizes occur, from continuous scientific progress all the way up to scientific revolutions, which change the way we see our world. Measuring the "boosting effect" of landmark papers, our analysis reveals how new ideas and new players can make their way and finally triumph in a world dominated by established paradigms. The underlying "boost factor" is also useful to discover scientific breakthroughs and talents much earlier than through classical citation analysis, which by now has become a widespread method to measure scientific excellence, influencing scientific careers and the distribution of research funds. Our findings reveal patterns of collective social behavior, which are also interesting from an attention economics perspective. Understanding the origin of scientific authority may therefore ultimately help to explain how social influence comes about and why the value of goods depends so strongly on the attention they attract.
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What (if any) are the returns to computer use?
Benoit Dostie, Rajshri Jayaraman & Mathieu Trépanier
Applied Economics, December 2010, Pages 3903-3912
Abstract:
Using North American data, we revisit the question first broached by Krueger (1993) and re-examined by DiNardo and Pischke (1997) of whether there exists a real wage differential associated with computer use. Employing a mixed effects model with matched employer-employee data to correct for the fact that workers and workplaces that use computers are self-selected, we find that computer users enjoy an almost 4% wage premium over nonusers. Failure to correct for worker and workplace selection effect leads to a more than twofold overestimate of this premium.
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The Economic Value of Improvements in Beef Tenderness by Genetic Marker Selection
Robert Weaber & Jayson Lusk
American Journal of Agricultural Economics, October 2010, Pages 1456-1471
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A genetic simulation model is combined with an economic model of the U.S. beef industry to determine how consumer demand shifts, resulting from bull and heifer selection strategies that improve steak tenderness, affect economic profitability at four points in the beef supply chain. The results indicate that a selection strategy in which bulls in the upper 30% of genetic merit are selected each year would result in increased profitability of $9.60/head for feeder cattle and $1.23/head for fed cattle in 20 years. The net present value of the genetic improvement program is estimated to produce economic benefits of $7.6 billion.
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Sarah Rodriguez et al.
American Journal of Bioethics, March 2011, Pages 20-28
Abstract:
In 1996 Congress passed the Dickey-Wicker Amendment (DWA) as part of an appropriations bill; it has been renewed every year since. The DWA bans federal funding for research using embryos and parthenotes. In this paper, we call for a public discussion on parthenote research and a questioning of its inclusion in the DWA. We begin by explaining what parthenotes are and why they are useful for research on reproduction, cancer, and stem cells. We then argue that the scientific difference between embryos and parthenotes translates into ethical differences, and claim that research on parthenotes is much less ethically problematic. Finally, we contextualize the original passage of the DWA to provide an explanation for why the two were possibly conflated in this law. We conclude by calling for a public discussion on reconsidering the DWA in its entirety, starting with the removal of parthenogenesis from this prohibition of National Institutes of Health (NIH) funding.