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Research Details

A Calculation of the Social Returns to Innovation

Abstract

This paper estimates the social returns to investments in innovation. The disparate spillovers associated with innovation, including imitation, business stealing, and intertemporal spillovers, have made calculations of the social returns difficult. Here we provide an economy-wide, average estimate that nets out the many spillover margins. We further assess the role of capital investment, diffusion delays, learning-by-doing, productivity mismeasurement, health outcomes, and international spillovers in assessing the average social returns. Overall, our estimates suggest that the social returns are very large. Even under conservative assumptions, innovation efforts produce social benefits that are many multiples of the investment costs.

Type

Book Chapter

Author(s)

Benjamin F. Jones, Lawrence H. Summers

Date Published

2021

Citations

Jones, F. Benjamin, and Lawrence H. Summers. 2021. A Calculation of the Social Returns to Innovation.

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