The Economy’s Hidden Problem: We’re Out of Big Ideas

while directing a growing share of innovative effort toward goals with benefits, such as cleaner air, that don’t translate into gross domestic product.

.. What’s left, he says, are diseases such as Alzheimer’s for which scientists lack a useful theory of treatment

.. 40% are for “orphan” drugs which address diseases that afflict fewer than 200,000 people.

.. In 1960, 7% of U.S. R&D was devoted to health care. By 2007, it was 25%

.. Thus, health research is displacing R&D that could have gone toward more mundane consumer products. Indeed, Mr. Jones predicts the rising value of human life virtually dictates slower growth in regular consumer goods and services—and they constitute the bulk of measured GDP.

.. Electric cars don’t yet offer a “value proposition that resonates with the mainstream customer,” says John Viera, head of sustainability at Ford Motor Co. He contrasts that with EcoBoost, a Ford-developed gasoline injection technology that achieves the same power with fewer cylinders. “The beauty is you get the fuel economy improvement with no loss in performance,” he says. “It does add cost, but the customer is willing to pay for that technology unlike with the electrified vehicle.”

 .. in the past decade the cost of one critical component, the gyroscope that keeps the vehicle level, plunged as the devices were developed for smartphones. Yet commercial drone operation was illegal, with some exemptions, because it required Federal Aviation Administration approval
.. the average internet retailer generates $1.3 million in sales per employee, compared with the average brick-and-mortar retailer’s $279,000. As Amazon’s market share has grown, that has lifted the entire industry’s productivity performance. Retail output per hour rose 3%
.. productivity growth has accelerated at “frontier” companies, which use the most efficient processes and technology, while slowing at the remainder of firms.
.. new technologies are in fact amalgams of technologies and business processes that are difficult to replicate and often patent protected. Many digital companies are “platforms” that invest heavily in proprietary algorithms to more efficiently match customers to what they need
.. So long as the frontier firm continues to innovate, that doesn’t hold back productivity. The risk is that once a firm becomes dominant, no competitor can match its network and innovation is less necessary to retain customers.
.. Then last May, Joshua Brown, a 40-year-old Ohio resident, was killed when his Tesla hit a tractor trailer while operating under Tesla’s “autopilot” mode. The incident could have triggered a regulatory crackdown that brought deployment of the technology to a halt. Instead, the National Highway Traffic Safety Administration in September announced nonbinding guidance on how manufacturers should ensure their systems are as safe as possible.