arec 230 Flashcards
Knowledge Spillovers? Examples?
- Knowledge spillovers are when knowledge created by one entity is used by another entity without full compensation.
- Learning from someone else’s design
What is a positive externality?
- When someone goes to university and learns something and shares it with someone else
In what sense is knowledge non-rivalrous?
- Your knowledge of a fact or idea does not block mine, and mine does not block yours.
What does ‘creative destruction’ refer to?
- When there is a new innovation and get decrease or make others not as good and take over
What is monopolistic competition and its characteristics?
- Monopolistic competition is a market structure where many companies compete by selling similar but differentiated products, meaning each product has unique features like branding, quality, or style, allowing firms to have some degree of price control despite having many competitors; key characteristics include a large number of sellers, product differentiation, and free entry and exit to the market.
What is endogenous growth theory?
- The endogenous growth theory is the concept that economic growth is due to factors that are internal to the economy and not because of external ones. The theory is built on the idea that improvements in innovation, knowledge, and human capital lead to increased productivity, positively affecting the economic outlook
What are the main findings of Bloom at al. (2020)
What are the main arguments of Alston & Pardey (2022)?
- Bloom- Putting more money into R&D and getting less new products, new ideas are hard to find
o Shift from single individuals to know of days large groups
o It is taking longer to discover ideas then it was back in the day
o Rising costs of innovation are rising and efficiency is decreasing
o Main point of decline in productivity
o With the decline could cause problems in innovation in the future - A&P- say that blooms info and data is not as strong
o Challenge the idea of how ideas are not the problem it’s the money and complexity
o They challenge that its not R&D production it’s the difficulty of finding significant, high impact innovations
o Say that more money is going into research rather than rate of return
o Say less innovations based on more people gaining knowledge in certain fields
o Say that the measurement of innovations might not account for some other innovations that are hard to qualify for patents and others
o They say many have discovered simpler concepts or innovations but know are trying to grow
o Global networks increase the competition
o Policy implications
o That there isnt innovation happening fast in some fields others like AI are continuing to grow
What is the ‘adoption puzzle’?
- Question why people are not adopting to new tech and why people are adopting compared to others
- ## Ex. Why is new pea variety’s so more popular there than in sask
What was the Green Revolution?
- Crop breeding’s in developing countries
- Capitalism vs communism
- Help people get richer and reduce communism around the world
- Investing into modern varieties to share to the world
What is a gene bank?
- Locations around the world holding seed varieties from around the world
Describe some of the technological revolutions that have occurred in agriculture?
- Hybrid, gene canola
- Tractors, tech
- Crop production revelation
- gmo
- Tractors, chemicals, green revolution, crop genetic, livestock
What is the role of the public and private sectors in crop breeding, genomics, and varietal release in Saskatchewan?
- Public:
o Lentils
o Wheat - Both:
o Peas
o Barley - Private:
o Canola
o Corn
o Soybeans
What are some of the main insights from monopolistic competition theories regarding where innovation takes place?( readings)
- Market Power Drives Innovation: Firms in monopolistic competition have some market power, allowing them to innovate in order to differentiate their products and charge higher prices, which incentivizes innovation.
- Product Differentiation: Innovation in such markets often focuses on differentiating products to cater to diverse consumer preferences, unlike in perfect competition, where firms have little incentive to innovate.
- Profit Motivation: Innovation allows firms to earn higher profits by offering unique products, justifying investment in R&D and product development.
- Entry and Exit Dynamics: New entrants bring fresh innovations, while established firms must innovate to stay competitive, with market barriers influencing the level of innovation.
- R&D Investment: Firms in monopolistic competition often invest heavily in R&D to create new or improved products, as innovation is a key strategy for maintaining a competitive edge.
- Spillover Effects: Innovations by one firm can spill over to others, encouraging more innovation across the industry, though competitors may benefit without incurring the full costs.
- Market Size and Consumer Preferences: Larger, diverse markets with varied consumer preferences provide more opportunities for innovation, as firms seek to cater to different segments.
What are the types of capitalism, according to Baumol et al., and what do they consider the best type for innovation? What are some of the recommendations that the authors of ‘Good Capitalism, Bad Capitalism,’ have?
- State Guided capitalism
o Government decides which industries grow
o State still enforces property and contract rights
o Telltale sign: if govt explicitly of implicitly owns banks
o Not referring to public good supply
o Problem: Picking wrong winners and losers - Oligarchic
o Govt policies designed to predominantly promote the interests of narrow portion of population(ex. Wealthy families, ruling autocrat and family/friends, etc.)
o Kleptocracy- prevalence of inequality-corruption
o Danger of abundant natural resources- informality
o Main goal not economic growth but economic position of the few
o Russia; Saudi Arabia; common in Latin America; Hungary
o Leads to inefficient allocation of capital - Big-Firm capitalism
o Economies in which large, established firms have become excessively powerful
o Seen as less innovative firms become lazy and live off cash flow
o Rent-seeking
o Could promote greater investment
o Bust risk is tendency not to innovate, job security, lack of entrepreneurial culture - Entrepreneurial capitalism
o Large # of people within the economy have the drive and incentive to innovate; single individuals or new firms most likely to create breakthroughs
o Commercialization of radical/breakthrough innovations
o Such radical innovations increase productivity and contribute to economic growth - Recommendations
o Incentives for productive entrepreneurship
o Dis-incentives for unproductive entrepreneurship (lobbying)
o Keeping winners on their toes
Anti-monopoly rules
Open borders (trade openness, FDI)
o Govern policies to facilitate foreign tech transfer
o Encouraging innovation through the corporate income tax system
o Encouraging the commercialization of university-based research
o Maintaining a well-trained workforce
o Political Economy of Growth
What is machine learning?
- the use and development of computer systems that are able to learn and adapt without following explicit instructions, by using algorithms and statistical models to analyze and draw interferences from patterns in data.
What is AI?
- A tech that enables machines to simulate human like intelligence and problem-solving capabilities
What is AGI- Artificial General Intelligence?
- Can make decisions and take autonomous actions, and learns from interactions
- Potential to match or surpass human cognitive capabilities
- Generalization, adaptability and problem-solving
- Capability to learn and adapt knowledge to unfamiliar situations
What is agentic AI?
- AI that can act as an ‘agent’ with capability for autonomous decision-making and action
- Combination of advanced tech such as machine learning, large language models, and neural networks
- Ex. Amazon (Alexa)
What might be some of the risk of AI?
- Hinton: deliberate misuse by malicious actors, technological unemployment, and existential risk from AGI
- IP
- Weapons/Military Use
- Algorithmic bias
- Enviro Impact
What economic evidence do we have on the role of immigrants and innovation (readings)?
According to ‘A toolkit of policies to promote innovation,’ what are some of the most effective ways to promote innovation?
In the short run, research and development tax credits and direct public funding
seem the most effective, whereas increasing the supply of human capital (for example,
through expanding university admissions in the areas of science, technology, engi-
neering, and mathematics) is more effective in the long run. Encouraging skilled
immigration has big effects even in the short run. Competition and open trade poli-
cies probably have benefits that are more modest for innovation, but they are cheap
in financial terms and so also score highly. One difference is that R&D subsidies and
open trade policies are likely to increase inequality, partly by increasing the demand
for highly skilled labor and partly, in the case of trade, because some communities will
endure the pain of trade adjustment and job loss. In contrast, increasing the supply
of highly skilled labor is likely to reduce inequality by easing competition for scarce
human capital
