117. Matt Ridley — How Innovation Works: and Why It Flourishes in Freedom

Innovation is the main event of the modern age, the reason we experience both dramatic improvements in our living standards and unsettling changes in our society. Forget short-term symptoms like Donald Trump and Brexit, it is innovation itself that explains them and that will itself shape the 21st century for good and ill. Yet innovation remains a mysterious process, poorly understood by policy makers and businessmen, hard to summon into existence to order, yet inevitable and inexorable when it does happen.

In his new book, How Innovation Works, Matt Ridley argues that we need to change the way we think about innovation, to see it as an incremental, bottom-up, fortuitous process that happens to society as a direct result of the human habit of exchange, rather than an orderly, top-down process developing according to a plan. Innovation is crucially different from invention, because it is the turning of inventions into things of practical and affordable use to people. It speeds up in some sectors and slows down in others. It is always a collective, collaborative phenomenon, not a matter of lonely genius. It is gradual, serendipitous, recombinant, inexorable, contagious, experimental and unpredictable. It happens mainly in just a few parts of the world at any one time. It still cannot be modelled properly by economists, but it can easily be discouraged by politicians. Far from there being too much innovation, we may be on the brink of an innovation famine.

Ridley derives these and other lessons, not with abstract argument, but from telling the lively stories of scores of innovations, how they started and why they succeeded or in some cases failed. He goes back millions of years and leaps forward into the near future. Some of the innovation stories he tells are about steam engines, jet engines, search engines, airships, coffee, potatoes, vaping, vaccines, cuisine, antibiotics, mosquito nets, turbines, propellers, fertiliser, zero, computers, dogs, farming, fire, genetic engineering, gene editing, container shipping, railways, cars, safety rules, wheeled suitcases, mobile phones, corrugated iron, powered flight, chlorinated water, toilets, vacuum cleaners, shale gas, the telegraph, radio, social media, block chain, the sharing economy, artificial intelligence, fake bomb detectors, phantom games consoles, fraudulent blood tests, faddish diets, hyperloop tubes, herbicides, copyright, and even a biological innovation: life itself. Shermer and Ridley discuss all this and:

• why the 2nd Law of Thermodynamics is the First Law of Life
• why the patent/intellectual property rights concept is antithetical to innovation
• why innovation is so much more important than invention
• why the Chinese system of innovation works even though it's government is anti-freedom
• why musical innovation did not decline with the advent of Napster
• the difference between scientific discoveries and artistic/musical creations
• vaccine innovation in the era of COVID-19
• why innovations are postdictable but not predictable, and
• how the future may change after this pandemic.

Matt Ridley is the award-winning, bestselling author of several books, including The Rational Optimist: How Prosperity Evolves; Genome: The Autobiography of a Species in 23 Chapters; and The Red Queen: Sex and the Evolution of Human Nature. His books have sold more than one million copies in thirty languages worldwide. He writes regularly for The Times (London) and The Wall Street Journal, and is a member of the House of Lords. He lives in England.

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