ABSTRACT
A. Introduction Innovation is a crucial determinant of long-term welfare, and thus a priority for public policy. Its value is twofold. First, scientifi c progress lifts constraints that had previously restricted a community’s wealth potential. A society’s technological ability to transform scarce inputs into valuable consumables and services limits the potential value of the economy. Second, technological advancement may make entirely new products and services possible, thus creating value for consumers where none existed before. The same is true of novel forms of artistic expression, from music to literature to art, which enriches people’s lives.
