Early adopters of new technologies are drivers of economic development. By using their knowledge to build technology-based businesses, these early adopters change their communities. During the Enlightenment, cities with more subscribers to Denis Diderot’s Encyclopedie grew more quickly, presumably because readers learned about what were then called the “mechanical arts”. Today, there’s a relationship between patent applications and household income – and the results’ aren’t promising for future growth.
In Entrepreneurs, Economic Growth, and the Enlightenment, Tim Sullivan of the Harvard Business Review (HBR) does more than explore research in the Quarterly Journal of Economics about urban development in eighteenth-century Europe. Sullivan relates this research to the economic prospects for twenty-first century America, and posits that “if we do want future growth, we should be focusing on young, smart kids and giving them access to whatever kind of knowledge and support they need.”
Egalitarianism may underpin the American educational system, but Sullivan sees a starring role for the best and the brightest young people. The “elite” that he elevates aren’t special because they’re wealthy. Rather, they’re elite because they’re smart. These are the students who could become entrepreneurs and founders of technology-based companies that provide employment for others.
Sullivan isn’t an “elitist”, however – at least not in the traditional, typically derogatory sense of that word. Rather, HBR’s editorial director wants America to do a better job at educating poor kids who are good at math and could someday use their abilities to start businesses and grow the economy. “How many Tesla’s are we smothering by not focusing on young kids with a potential for STEM?” he asks his readers.
Tim Sullivan’s evidence is compelling. Citing a paper from the Summer Session of the National Bureau of Economic Research, he demonstrates the relationship between socioeconomic status and the propensity to file a patent. It’s probably not surprising that kids of wealthier parents are more likely to file patents, but poor kids who do well at math are three to four times less likely to file them than their wealthier, math-adept peers.
Many manufacturers are concerned about the so-called “skills gap”, and wonder where America will find the skilled workers of the future. Given Tim Sullivan’s argument, should economists also worry about where the U.S. will find its next generation of entrepreneurs?
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