(Image: Andrzej Krauze)
AT THE turn of the 19th century, the world stood poised for one of its greatest transformations. An increasing ability to apply the fruits of science to everyday needs created a priceless new paradigm for advancing humanity.
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In the decades that followed, as we worked out how to better manage this process, we began to emerge from the and suffering that marked preceding centuries. Economic growth exerted its life-enhancing magic.
The industrial revolution in the UK sparked social changes that eventually spread far beyond its shores and steadily transformed standards of living, at least for the industrialised parts of the world.
Unfortunately, progress seems to have slowed recently, and . Why? To answer that, we need to understand the origins of economic growth.
For years, economists assumed growth came from increases in the triple alliance of labour, capital (basically equipment to produce goods and services to trade) and resources. Growth would follow as populations and trade increased, and new sources of minerals such as coal, gold and oil were discovered.
Economist Moses Abramovitz was among the first to cast doubt on this claim. He found that although US national output per capita had essentially quadrupled over eight decades up until the mid-20th century, changes in labour and capital accounted for only 10 per cent of that growth.
In 1950, Robert Solow at the Massachusetts Institute of Technology examined the US economy between 1909 and 1949. He, too, tried to reconcile growth data with increases in the triple alliance, but could not.
Ironically, economists had expected that the part of growth not explained by labour, capital and resources would be small. Accordingly, they named it “the residual”.
Solow, introducing a “new wrinkle”, concluded that the bulk of growth – seven-eighths, in fact – came from (better machines, not more of them, for example). Thus, the triple alliance, long assumed to be humanity’s sole benefactor, had played only a minor role.
Solow was awarded the for his remarkable discovery. Unfortunately, research funding agencies today seem to have forgotten his lessons.
Capitalism, the ideology behind all industrial and commercial enterprise for centuries, demands incessant growth. Amazingly, for much of the past century – and despite crises and wars – science has risen to those demands, but seems to have failed to do so over the past few decades. We now have a tiger by the tail. If we cannot find viable alternatives to capitalism that offer increased living standards for the majority, we must ensure that we have an adequate flow of technological change to appease the gods of growth.
If we do nothing, we will soon fall back into the stagnation that humanity has often had to deal with. The . Bureaucracy and red tape are slowly strangling us.
How can increased growth be fostered? Global expenditure on R&D is , which suggests no dearth of commitment. However, the governance of scientific research is now dominated by the pursuit of nitpicking efficiency and the elimination of risk. Funding agencies have preconceived ideas about what they are looking for and accordingly view the future as predictable. Their attempts to manage creativity only seem to result in its curtailment.
One key obstacle is the use of peer review as the gold standard for deciding what research gets funded. This is deluded. Although peer review might work for the mainstream, it excludes radical departures in thinking.
“One key obstacle is the use of peer review for deciding what research gets funded. This is deluded”
The kind of that we need more of, driven by curiosity, has suffered in a world that prioritises practical answers and value for money. In the UK, blue-skies funding is . The backdrop to this is a prolonged period of budget freezes and spending reviews that seek to cut public expenditure further, as a goal-oriented ethos and short-termism become more entrenched. None of this encourages the freethinking research that led to many major breakthroughs in the past.
The enforced conservatism surrounding research priorities substantially lowers the chance of major discoveries and contributes to the problem of feeble growth. Unless we restore total freedom to the few academics who can make good use of it, the outlook for civilisation is bleak.
The problem is who to fund. The truly great 20th-century discoveries were made by some 500 researchers working on problems they had selected. Almost all were academics who made serendipitous discoveries, and many won Nobel prizes. They are members of what I call the Planck Club after physicist Max Planck, who discovered in 1900 that energy was quantised. They also transformed economic growth, and it is imperative that we find new sources of funding for their successors. It represents an ideal opportunity for investors, provided they realise that the work of the few they bankroll cannot be predicted or controlled.
In 1980, energy giant British Petroleum set up such an initiative, its , which I led. It ran until 1993, and its modest £20 million outlay over that period supported 37 research groups with radical ideas that mainstream peer review would have rejected. It created at least 14 breakthroughs.
Something akin to this must be repeated if we are to rekindle the progress of the past.
This article appeared in print under the headline “Liberate the scientists”