My 99 favorite quotes from “How Innovation Works” by Matt Ridley

Initially published as a tweetstorm on November 16th, 2020

1. “Innovation, like evolution, is a process of constantly discovering ways of rearranging the world into forms that are unlikely to arise by chance — and that happen to be useful”

2. [Innovation] “means more than invention, because the word implies developing an invention to the point where it catches on because it is sufficiently practical, affordable, reliable and ubiquitous to be worth using”

3. “Innovation is the most important fact about the modern world, but one of the least well understood”

4. “Innovation happens when people are free to think, experiment and speculate”

5. “Most innovation is a gradual process. The modern obsession with disruptive innovation, a phrase coined by the Harvard professor Clayton Christensen in 1995, is misleading”

6. “Innovation often disappoints in it early years, only to exceed expectations once it gets going”

7. “Failure is often the father of success in innovation”

8. “The story of the light bulb, far from illustrating the importance of the heroic inventor, turns out to tell the opposite story : of innovation as a gradual, incremental, collective yet inescapably inevitable process”

9. “Thomas Edison understood better than anybody before, and many since, that innovation itself is a product, the manufacturing of which is a team effort requiring trial and error”

10. “The history of turbines and electricity is profoundly gradual, not marked by any sudden step changes”

11. “The 20th century saw only one innovative source of energy on any scale: nuclear power”

12. “Nuclear power is a technology ill-suited to the most critical of innovation practices : learning by doing”

13. “Extra safety requirements have simply turned nuclear power from a very, very safe system into a very, very, very safe system. Or maybe they have made it less safe”

14. “It is now likely that nuclear fusion, the process of releasing energy from the fusion of hydrogen atoms to form helium atoms, may at last fulfill its promise and begin to provide almost unlimited energy within the next few decades”

15. “Just as the early opponents of the railways accused trains of causing horses to abort their foals, so no charge was too absurd to level against the shale gas industry”

16. “Innovation proves to be gradual and to begin with the unlettered and ordinary people, before the elite takes credit”

17. “Vaccination exemplifies a common feature of innovation: that use often precedes understanding. Throughout history, technologies and invention have been deployed successfully without scientific understanding of why they work”

18. “The source of the invention of chlorination, like that of vaccination, is enigmatic and confused. Only in retrospect can it be seen as a disruptive and successful innovation that saved millions of lives”

19. “The story of penicillin reinforces the lesson that even when scientific discovery is made, by serendipitous good fortune, it takes a lot of practical work to turn it into a useful innovation”

20. “In the early years of the car industry, as in the early years of computers, mobile phones and many other innovations, the inventors thought they were developing a luxury good for the upper-middle classes”

21. “Innovation is not a an individual phenomenon, but a collective, incremental and messy network phenomenon”

22. “Like radar and computer, the jet is often thought to be a product of wartime inventiveness. But, as in those other cases, the key work was actually done long before hostilities broke out”

23. “The astonishing safety record of the modern airline industry has been achieved, quite literally, by trial and error. Its methods have since been emulated in other walks of life such as surgery and offshore oil and gas exploration”

24. “In 1748, the French parliament, in an early example of the precautionary principle later to inhibit the use of genetic modification, banned the growing of potatoes for human food — just in case they did cause leprosy”

25. “The developments of the search engine and social media follow the usual path of innovation: incremental, gradual, serendipitous and inexorable; few eureka moments or sudden breakthroughs”

26. “Even if you call Gutenberg the inventor, Martin Luther was the true innovator, transforming the use of printing from an obscure business confined mainly to the ecclesiastical elite to a mass-market operation aimed at ordinary people”

27. “Innovation flourishes in wealthy, growing and well-connected places at a time of peace and relative prosperity”

28. “Innovation is a lot less directed and planned, even today, than we tend to think. Most innovation consists of the non-random retention of variation design”

29. “Dense populations inevitably spur human technological change, because they create the conditions in which people can specialize”

30. “If you cut people off from exchange, you lower their chances of innovating”

31. “Innovation flourished in cities that traded freely with other cities, in India, China, Phoenicia, Greece, Arabia, Italy, Holland and Britain: places where ideas could meet and mate to produce new ideas”

32. “Intellectual property is now a hindrance not a help to modern innovation”

33. “Every technology is a combination of other technologies; every idea a combination of other ideas”

34. “If error is a key part of innovation, then one of America’s greatest advantages has come from its relatively benign attitude to business failure”

35. “The myth of the lonely inventor, the solitary genius, is hard to shake. Innovation always requires collaboration and sharing”

36. “Most inventions lead to priority disputes between competing claimants. People seem to stumble on the same idea at the same time”

37. “Simultaneous invention is more the rule than the exception. Many ideas for technology just seem to be ripe, and ready to fall from the tree”

38. “Technology is absurdly predictable in retrospect, wholly unpredictable in prospect. Thus predictions of technological change nearly always look very foolish. They either prove overblown, or equally wildly underblown”

39. “Anticipating what people want is something innovators are often good at; academics less so”

40. “Amara’s Law states that people tend to overestimate the impact of a new technology in the short run, but to underestimate it in the long run”

41. “I cannot help thinking that blockchain is in the early stages of the hype-cycle: we are overestimating its impact in the short run”

42. “Empires are bad at innovation. Though they have wealthy and educated elites, imperial regimes tend to preside over gradual declines in inventiveness, which contribute to their eventual undoing”

43. “Italy’s most fertile inventive period was in the Renaissance, when it was the small city states, run by merchants, that drove innovation: in Genoa, Florence, Venice, Luca, Siena and Milan. Fragmented polities proved better than united ones”

44. “For at least a thousand years, innovation has disproportionately happened in cities, and especially self-governing ones”

45. “The infrastructure scales at a sublinear rate, but the socio-economic products of a city scale at a superlinear rate”

46. “Those who say that indefinite growth is impossible, or at least unsustainable, in a world of finite resources are wrong, for a simple reason: growth can take place through doing more with less”

47. “It will always be possible to raise living standards further by lowering the amount of resource that is used to produce a given output. Growth is therefore infinitely “sustainable””

48. “Throughout the 19th century, as Britain and Europe developed new railways, steel, electricity, textiles and many other technologies, government played almost no role at all, except, as a belated regulator, standard creator and customer”

49. “America became the most advanced and innovative country in the world in the early decades of the 20th century without significant public subsidy for research and development of any kind before 1940”

50. “In the second half of the 20th century, the state did become a sponsor of innovation on a large scale, but that is hardly surprising given that it went from spending 10% of the national income to 40% in almost all Western countries”

51. “It is not a matter of whether the state has caused some innovation. The question is whether it is better at doing so than other actors, and whether it does so in a directed fashion”

52. “The Soviet Union was a very clear case of an entrepreneurial state, funding a great deal of research centrally, allowing virtually no private enterprise, and the result was a dismal lack of innovation in transport, food, health or any consumer sector”

53. “There is nothing quite so lacking in innovation as the practices and premises of government”

54. “We make a mistake if we insist that science is always upstream of technology. Quite often scientific understanding comes from an attempt to explain and improve a technical innovation”

55. “Manned space exploration does not really meet the test of an innovation that is ever likely to pay for itself. It is more art in that sense”

56. “To contribute to human welfare, and therefore catch on without subsidy, an innovation must meet two tests: it must be useful to individuals, and it must save time, energy or money in the accomplishment of some task”

57. “Compared with a subsistence farmer, most modern people have a less varied job but a more varied life”

58. “Something new that increases the specialization of production or increases the diversity of consumption will catch on, something that returns us towards self-sufficiency will not catch on”

59. “The idea that innovation destroys jobs comes around in every generation. So far it has proved wrong”

60. “Big companied are bad at innovating, because they are too bureaucratic, have too big a vested interest in the status quo and stop paying attention to the interests, actual and potential, of their customers”

61. “For innovation to flourish, it is vital to have an economy that encourages or at least allows outsiders, challengers, and disruptors to get a foothold. This means openness to competition, which historically is a surprisingly rare feature in most societies”

62. “The ultimate form of open innovation is open-source software”

63. “The opportunities for free innovation are growing as computerized design tools and lowered communication costs allow people to do at home what once required a corporate laboratory to achieve”

64. “If Google Glass had been a government project, the chances are they would still be ploughing on with it”

65. “The characteristic features of opposition to innovation: an appeal to safety; a degree of self-interest among vested interests; and a paranoia among the powerful”

66. “Truly, there is likely to be a backlash against any new technology, usually driven partly by vested interests but clothing itself in the precautionary principle”

67. “The precautionary principle largely ignores the risks of existing technologies, defying the concept of harm reduction”

68. “One way in which the precautionary principle works to prevent innovation is by making experimentation difficult in the period between prototype and practical application”

69. “It is now clear that the opposition to genetically modified crops was wrong both factually and morally”

70. “If Europe were to ban glyphosate it would open up a litigation bonanza in America, where bounty-hunting law firms are constantly in search of the next tobacco-sized windfall”

71. “The history of cellular telephony is an extraordinary story bureaucratic delay imposed by government at the behest of various lobbies”

72. “The government, in cahoots with crony-capitalist firms with huge vested interests, made the development of cellular service impossible for almost four decades. Who knows what improvements in technology and changes in society it thus prevented?”

73. “We use smartphones today not because of government regulators, but despite them”

74. “The coming regulation of the digital industry will almost certainly stifle innovation, whatever else it achieves”

75. “Whatever else positive GDPR achieves, it will also have created a barrier to entry preventing innovative smaller firms from challenging the big technology companies. As always, regulation favours incombents”

76. “The evidence clearly show that while intellectual property helps a little, it also hinders, and the net effect is to discourage innovation”

77. “Shakespeare had no copyright protection, and pirated copies of his plays abounded, but he still wrote”

78. “The Semiconductor Chip Protection Act of 1984 resulted in more patenting but less innovation in the United States, as semiconductor firms effectively set about stocking “war chests” of patents to deploy in disputes with each other”

79. “There is no evidence that there is less innovation in areas unprotected by patents”

80. “There is just no evidence from geography and history that patents are helpful, let alone necessary, in encouraging innovation”

81. “Patents tend to favour inventions rather than innovations: upstream discoveries of principles, rather than downstream adaptation of devices to the markets”

82. “Despite evidence, industry — the legal industry in particular — has been successful in arguing for much stricter patent protection in recent years”

83. “All in all, the evidence that patents and copyrights are necessary for innovation, let alone good for it, is weak”

84. “There is simply no sign of “market failure” in innovation waiting to be rectified by intellectual property, while there is ample evidence that patents and copyrights are actively hindering innovation”

85. “In Europe, roughly 5,000 professions are restricted to those with government-mandated licences”

86. “In 1937 the number of taxis in Paris was capped at 14,000. In 2007 it was capped at 16,000. Did it occur to anyone that consumer interest in taxis might have grown dramatically over this time period?”

87. “It is the European Union’s general — if unintentional — hostility to the innovative process that is a likely cause of the recent slow growth of Europe’s economies. The odds are stacked too high against the entrepreneur”

88. “The EU placed a string of obstacles in the way of digital startups, leaving Europe in the slow lane of the digital revolution, and with no digital giants to rival Google, Facebook or Amazon — unlike China”

89. “Innovation is one of those things that everybody favours in general, and everybody finds a reason to be against in particular cases”

90. “Far from being welcomed and encouraged, innovators have to struggle against the vested interests of incumbents, the cautious conservatism of human psychology, the profitability of protest, and the barriers to entry erected by patents, regulations, standards and licences”

91. “The main ingredient in the secret sauce that leads to innovation is freedom”

92. “Innovation is the child of freedom, because it is free, creative attempt to satisfy freely expressed human desires”

93. “There is little doubt that innovation could dramatically change the world in the coming decades. The potential is vast but will only be imperfectly realized because of the gauntloops and ordeals that inventors must run”

94. “By 2050 we could have altered the relationship between government and money, through the use of cryptocurrencies, so as to banish rapid inflation once and for all”

95. “Compliance with regulation almost always hits small companies harder, proportionately, than big ones, thus deterring new entrants with new ideas from entering existing markets”

96. “In Europe, creative destruction has almost ground to a halt in the cuddly embrace of the European Commission with its tendency to write rules that favour incumbent firms”

97. “The West may still do clever new things in finance, science, the arts and philanthropy, but it is slowing down in innovating the products and the processes that affect everyday life. Bureaucracy and superstition get in the way of anybody who tries”

98. “Edison tested 6,000 plant material till he found the right kind of bamboo for the filament of the light bulb. The perspiration, not the inspiration, is the bit that much of the West has forgotten or forbidden”

99. “Innovation is the child of freedom and the parent of prosperity. It is on balance a very good thing. We abandon it at our own peril”