What the green revolution can learn from the IT revolution
3 February 2020
IIPP policy brief outlines recommendations for planning an innovative overhaul of our economy towards economic growth which is more sustainable and inclusive, as we learn important lessons from the IT revolution.
The IT revolution would not have happened without early and directed risk-taking from the State. As shown by Professor Mariana Mazzucato’s The Entrepreneurial State, all the areas that make our smart products smart were funded by the public sector.
The information age began in the 1960s, propelling digital knowledge and data ownership into new forms of power— and models of value creation—for the late 20th and early 21st centuries. The spread of information technology over the past 30 years has been one of the most rapid invention-innovation-diffusion processes in any technological revolution. How can we learn from the successes and pitfalls of the IT revolution to ensure an effective green revolution?
A green transition cannot happen in one, isolated economy or nation-state; the entire global and interdependent system must shift together. The globalised nature of production chains means that even products which are 'greener' at point of use, such as electric vehicles, require cobalt and lithium— non-renewable elements extracted in countries with loose child labour and human rights laws.
IIPP Director Mariana Mazzucato and Head of Green Economy and Sustainable Growth Martha McPherson write in their policy brief six recommendations towards sustainable and inclusive economic growth:
Markets will not find the desired direction on their own. Public policy and public investment are key to leading the way.
Public investment is most effective when led by ambitious and flexible mission-oriented public organisations.
Innovation and investment need to happen across the entire innovation chain, including both supply and demand.
Citizens can shape the green transition from the start—as users, workers and systems-owners.
Patient finance is crucial for innovation, and the short-termism and financialisation that has taken place in the IT and in the pharmaceuticals sectors should be avoided.
Proactive regulation can help overcome incumbency and lock-in effects.