Innovation, Capital Formation, and Economic Policy

Innovation, Capital Formation, and Economic Police" Photo:

Price: Festival pass required
Time: 13:40

In the long run, nations become more prosperous, in the sense of higher per-capita incomes, lower unemployment, lower poverty levels, and so on, the fewer road blocks lie in the way of steadily higher productivity, along with productive capacity to take advantage of the productivity growth. In large parts of the world today, however, the business environment is characterized by an extent of uncertainty that is unprecedented over the past several decades. The main reason is lack of clarity in economic policy making. In order to be properly informed and well founded, important growth-promoting decisions, such as innovative activity, investment in new productive capacity, choice of new markets, and so on, require an assessment – an expectation – of the policy environment years into the future. Important policy dimensions are tax policy, spending and debt policy, extent of trade restrictions, and the regulatory environment in general. The increase in policy uncertainty over the past decade was quite predictable. The talk will expound on fundamental reasons rooted in economic science.

Finn Kydland Credit Franz Johann Morgenbesser
Economist, Nobel Laureate
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