Innovation Boot Camp / Conference for young scholars ‘Innovation, Institutions, and Governance’
INET Young Scholars Initiative Working Group Economics of Innovation
Ragnar Nurkse Department of Innovation and Governance
Tallinn University of Technology, Estonia
Innovation Boot Camp / Conference for young scholars
‘Innovation, Institutions, and Governance’
September 16-19, 2017
September 16 (Saturday)
13:00 – 13:30 welcome coffee, opening words, presentation by the Ragnar Nurkse Department
13:30 – 16:00 workshop I ‘Capitalism and Innovation: The long view’ by Erik Reinert
16:00 – 16:30 coffee break
16:30 – 19:00 workshop II ‘Unleashing the golden Age of the ICT revolution’ by Carlota Perez
20:00 welcome dinner for all participants (at the hotel)
September 17 (Sunday)
9:15 – 9:30 morning coffee
9:30 - 12:00 (room SOC-414) & 10:00 – 12:00 (room SOC-413) presentations of papers (parallel sessions) (schedule of presentations)
12:00 – 13:00 lunch
13:00 – 15:30 workshop III ‘Innovation and the State’ by Dan Breznitz
15:30 – 15:45 coffee break
15:45 – 18:45 (room SOC-414) & 15:45 - 18:15 (room SOC-413) presentation of papers (parallel sessions) (schedule of presentations)
September 18 (Monday)
8:45 – 9:00 morning coffee
9:00 – 11:30 workshop IV ‘Markets, Speculation and the State’ by William Janeway
11:30 – 12:30 lunch
12:30 – 15:00 workshop V ‘Capital in Economic Theory & History’ by Mary O’Sullivan
15:00 – 15:30 coffee break
15:30 – 17:00 talk ‘Innovation and Technology from a non-Western perspective’ by Wolfgang Drechsler
September 19 (Tuesday)
9:00 – 10:15 presentation of e-Estonia showroom (Lõõtsa str. 2a)
10:15 – 10:30 coffee break
10:30 – 12:00 round table I ‘Digital Governance: e-Residency’
12:00 – 12:15 coffee break
12:15 – 13:45 round table II ‘Data Analytics in Public Policy: Estonian Tax Board’
14:00 – 15:30 farewell lunch (in Dvigatel, Lõõtsa str. 6)
15:30 – 17:30 Old Town guided tour with Prof. Dr. Wolfgang Drechsler
I 'Digital Governance: e-Residency'
Panelists: Mr. Kaspar Korjus (Team Lead and Managing Director of e-Residency programme); Prof. Robert Krimmer (Tallinn University of Technology); Mr. Linnar Viik (Tallinn University of Technology, former advisor to the PM on ICT and R&D).
Summary: Building on the existing infrastructure behind e-gov services Estonia aspires to targetinternational community of entrepreneurs by the e-Residency programme launched in late 2014. e-Residency is the extension of a decade-long experimentation with e-government services. The latter have evolved, to a large extent, building on online banking successfully deployed by commercial banks operating in Estonia in late-1990s, thereby creating the trust in e-services among citizens. Now, with the sophistication of financial services, stricter financial and regulatory regimes, issues of immigration, the question of what is the real potential of an open-ended vision of the e-Residency Programme managed by a governmental start-up-like team to bring foreign talents to Estonia is worth exploring.
Aim: The panel seeks to compare the success of ICT-innovations in public service delivery, which effectively leveraged on innovation in the private sector (online banking) but lacked a strategic government vision, with the e-Residency programme, that lacks a clear business model, coherent planning and is an open-ended initiative, although its goals are clear (at least in rhetoric): to bring foreign entrepreneurial talents to Estonia.
II 'Data Analytics in Public Policy: Estonian Tax Board'
Panelists: Mr. Margus Sarapuu (Head of 'Zero Bureaucracy' Taskforce', previously Director for Strategy of the Government's Office); Mr. Ivar Laur (Chief Specialist of Intelligence Department, Estonian Tax and Customs Board); Prof. Rainer Kattel (Tallinn Univeristy of Technology and University College London); Mr. Nicolas Colin (co-founder of The Family, former inspecteur des finances at Inspection Générale des Finances, France)
Summary: Increasingly tax authorities employ data analytics tools to address compliance. More importantly, the tax function is increasingly viewed as adding value to policy-making by helping make ‘informed decisions.’ Evidence-based policy-making is widely discussed among academics and practitioners as having ‘huge potential, huge challenges’. Accuracy of data, privacy concerns, analytical capacity to collect and process the data, issue of bias inherent in algorithms are just some of the problematic points. Further, digital economy poses additional challenges to tax authorities due to the new ways value is defined and created. The Tax Board (EMTA) can be considered as the most tech savvy and innovative public agency with the highest technological and analytical capabilities in Estonia. Its ‘1000 EUR project’ implemented in 2015, aims at recording all transactions above 1000 EUR in order to reduce VAT frauds. In line with EMTA’s strategic development plan 2017-2020, it is also believed that the tax data can be effectively used to monitor, predict and assess political decisions, and data-driven new functions should be the agency’s strong focus.
Aim: the panel aims to identify and critically assess technology-driven solutions used by the Tax Authority and its (potential) position in policy context.
Workshops and talks - reading materials to prepare
I ‘Capitalism and Innovation: The long view’
by Erik Reinert
Neoclassical economics has no theory of uneven economic development. This lecture attempts to outline an evolutionary theory of uneven economic development, drawing on historical examples of such theories being employed in practice. A historical overview of policies of the Renaissance, mercantilism and cameralism of Continental Europe, and policies of successful industrialisation will be discussed in relation to developments in economic theory. A special attention will be brought to policy failures, policy learning, and emulation.
Essential reading material
- Reinert, Erik. (2006) ‘Evolutionary Economics, Classical Development Economics, and the History of Economic Policy: A plea for Theorizing by Inclusion.’ Working Paper in Technology Governance and Economic Dynamics No 1.
- Reinert, Erik. (2017) ‘80 Economic Bestsellers before 1850: A Fresh Look at the History of Economic Thought.’ Working Paper in Technology Governance and Economic Dynamics No 74.
II ‘Unleashing the Golden Age of the ICT Revolution: Why the State needs to tilt the playing field’
by Carlota Perez
The world is going through turbulent times reminiscent of the 1930s and the 1890s. Looking at the history of technological revolutions that is not surprising. The early decades of each of the five technological revolutions to date have been times of major bubbles and new financial fortunes, leading to a boom that ends in a crash. The subsequent recession reveals the unacceptable levels of unemployment and inequality that creative destruction and bubble prosperities bring. They are times of populism and demagogues, anger and violence. Yet what has followed have been the golden ages of each revolution. Such positive outcomes, however, have not been the result of markets alone but of a very proactive role of the State providing a synergistic direction for innovation and investment, which in fact tilts the playing field regulating finance, favouring long term investment and providing dynamic demand. It also guides the new wealth creating potential towards wider social benefits and stable growth. The workshop will discuss the implications of this explanatory framework and its political and practical implications in an interactive way.
Essential reading material
- Perez, Carlota (2016) “Capitalism, Technology and a Green Global Golden Age: The Role of History in Helping to Shape the Future” Ch. 11 in Mazzucato and Jacobs (2016) eds. Rethinking Capitalism. Special issue of Political Quarterly. Available as Working Paper.
III ‘Innovation and the State’
by Dan Breznitz
In the last several decades the production system of goods and services has significantly changed, rapidly becoming a globally fragmented. What does that mean for economies, which want to stimulate and sustain innovation-based growth? Is there a role for government? Do we have more or less choices? And what are the consequences of these choices? How should we even think about these questions?
Essential reading material
- Breznitz, Dan. (2011) ‘Innovation and the State: Political Choice and Strategies for Growth in Israel, Taiwan, and Ireland.’ Chapters 1, 2 + Conclusion.
- Breznitz, Dan and Michael Murphree. (2011) ‘Run of the Red Queen: Government, Innovation, Globalization, and Economic Growth in China.’ Chapters 1, 2 + Conclusion.
- ‘Innovation and the State’ Chapters 3, 4
- ‘Run of the Red Queen’ Chapters 3, 5.
IV ‘Markets, Speculation and the State’
by William Janeway
Essential reading material
- Blog entries
- Tim O’Reilly: https://medium.com/the-wtf-economy/the-wtf-economy-a3bd5f52ef00
- Tim O’Reilly: https://medium.com/the-wtf-economy/wtf-whats-the-future-e52ab9515573
- Bill Janeway: https://medium.com/the-wtf-economy/enterprise-software-death-and-transfiguration-99eb1d3fc4c0
- Bill Janeway: https://medium.com/the-wtf-economy/the-retreat-from-hyper-globalization-680c0c529649
- Bill Janeway: https://medium.com/@bjaneway/which-productivity-puzzle-ffe1d574ae96
- on crypto currency
V ‘Capital in Economic Theory & History’
by Mary O’Sullivan
An eminently sensible Swedish economist once explained that if “that unwholesome Irish stew called ‘modern capitalism’ ” is to have any meaning it ought to be connected to the study of capital in “economic science”. In the first part of this workshop, we will endeavour to make some sense of the sustained, though sporadic, efforts to develop a science of capital within the emerging discipline of economics from the mid-18th century. We will see that economists assigned capital an extremely prominent place in their analysis of economic life but they dithered endlessly about the nature of capital, they obfuscated as much as they clarified about capital’s economic roles, and they assumed as much as they explained about its rewards. The result, evident in successive “capital controversies” in the 19th and 20th centuries, was enormous contention and confusion about capital within the economics discipline. Indeed, it seems fair to say that the economic science of capital might itself be deemed an “unwholesome Irish stew”.
In the first half of the 20th century, largely for the purposes of empirical analysis, economists moved on from these controversies not by resolving the issues in theoretical dispute but by settling on what one prominent US economist rather disarmingly admitted were “parables of capital“. In the second part of the workshop, we will consider the substantial and ironic impact these parables have had on how we understand capital’s place in the history of economic life. Broadly speaking, we will see that capital -- its nature, its function and its rewards – has been written out of that history with devastating effect for any serious consideration of the role and rewards of capital in contemporary and past societies. Thomas Piketty tried to plug that void with massive amounts of historical data in his Capital in the Twenty-First Century but certain parables of capital still play a crucial role in his analysis. We will discuss ways in which economic history can be used in more ambitious ways to construct foundational elements for the analysis of capital that offer more insight than conventional economics on capitalism in the present and the past.
Essential reading material
- Geoffrey M. Hodgson, “What is capital? Economists and sociologists have changed its meaning: should it be changed back?”, Cambridge Journal of Economics, 2014, 38, 1063–1086. A background reading for our discussion of economists’ reflections on the concept of capital.
- Charles W. Cobb and Paul H. Douglas, “A Theory of Production”, American Economic Review, Vol. 18, No. 1, Supplement, Papers and Proceedings of the Fortieth Annual Meeting of the American Economic Association, 1928, 139-165. One of most influential papers in 20th century economics with a crucial, although neglected, significance for the empirical analysis of capital.
- Mary A. O’Sullivan, “A Confusion of Capital in the United States”, in Pat Hudson and Keith Tribe, eds., The Contradictions of Capital in the Twenty-First Century : The Piketty Opportunity, Agenda Publishing, 2016, 131-165. An initial but certainly incomplete and partly unsatisfactory effort by me to bring history to bear on the economic analysis of capital.
VI ‘Innovation and Technology from a non-Western perspective’
by Wolfgang Drechsler
Are Technology and Innovation universal, or does context matter? After an only mildly exciting but necessary theory part that covers the question of universality vs. specificity and its implications, this talk will address the three main contemporary paradigms challenging the global-Western one, Confucianism (i.e. the classical Chinese system), Islam, and Buddhism. Exemplarily, and because these topics also address some of the main debates in the respective areas, we will discuss Confucianism and Innovation, Islam and Technology, and Buddhism and the issue of whether Innovation and Technology are that great to begin with.
Essential reading material
- Drechsler, Wolfgang. (2013) ‘Three Paradigms of Governance and Administration: Chinese, Western and Islamic’. Working Paper in Technology Governance and Economic Dynamics No 50.
- Drechsler, Wolfgang. (2016) ‘The Reality and Diversity of Buddhist Economics (With Case Studies of Thailand, Bhutan and Yogyakarta).’ Working Paper in Technology Governance and Economic Dynamics No 69.
version: 1 September, 2017