How Innovative Are Innovations? A Multidimensional, Survey-Based Approach
We suggest that, with proper design, innovation surveys can provide valuable data on innovation rates that inform judgments about whether the reported innovations are important, and in what sense, thus making such data more interpretable than claims that such innovations are simply “new.” First, we recommend asking respondents questions about a specific innovation in an identified line of business. Second, we recommend asking respondents to characterize their innovations in terms of different features that potentially link to the social welfare impact of the innovation. We propose five such features: technological significance, utility, uniqueness, imitability, and how different the innovation is from what the innovating firm has previously commercialized (what we call “distance” or the “implementation gap”). The paper then illustrates the utility of our approach by, first, using newly collected data to construct measures corresponding to the proposed dimensions of innovation. We then use those measures to inform judgments about the importance of innovations in different industries. By recognizing the distinct features of innovations, we also showed how these features, when combined in novel and distinct ways, can provide a more nuanced view of innovation and its complexity.
This research was funded by grants from the National Science Foundation (#0830349; #1262418; #1646689) and the Kauffman Foundation (#20085262), and Startup Grant from Lee Kuan Yew School of Public Policy, National University of Singapore (#R-603-000-261-133). Additional support was provided by the Fuqua School of Business, Duke University; the School of Public Policy, Georgia Institute of Technology; and the National Institutes of Health (Award Number P50HG003391). We appreciate the helpful comments from participants in conferences and seminars at the OECD Blue Sky conference (Ghent), the NBER-CRIW Conference: Measuring and Accounting for Innovation in the 21st Century, the NCSES/CNSTAT Workshop on Advancing Concepts and Models of Innovative Activity and STI Indicator Systems (Washington), FEDEA (Madrid), and National Institute of Science and Technology Policy (Tokyo). Finally, we thank Javier Miranda and Mark Roberts for helpful comments. The views expressed herein are those of the authors and do not necessarily reflect the views of the National Bureau of Economic Research.