| Abstract: |
The present document provides the take of innovation economists on the current
pandemic. It is addressed to the general public and focuses on questions
related to the Science, Technology, and Innovation (STI) ecosystem. It does
not present new research findings. Instead, it provides a reading of current
real-world developments using economic reasoning and relying on existing
economic research. The first part of the report explains the root causes for a
general underinvestment in Research and Development (R&D), with a particular
focus on vaccines. These causes include an insufficient demand for vaccines in
normal times and the very characteristics of R&D. Governments can intervene to
mitigate these problems, but government intervention comes with its own set of
issues. We discuss three of them, namely free riding, setting research
priorities, and acting on scientific knowledge. The second part discusses
several aspects related to current STI policy reactions. First, we observe a
sizable shift of funds towards research on SARS-CoV-2. Aren’t we wasting money
by allocating so much of it on one single scientific problem? Using the
concept of the ‘elasticity of science,’ we argue that we are far from a
situation where additional funding would represent a waste of money. Second,
we also observe an unprecedented level of cooperation among researchers but
also an intense competition to find therapeutic solutions and vaccines. We
seek to make sense of this apparent antonymy, highlighting how both
cooperative and competitive forces might accelerate research. Third, we focus
on one policy tool, namely patents, and we discuss whether the existence of
patents hampers the search for a solution. We argue that it might, but we
provide ways in which patents can be beneficial. They can accelerate research
(such as through patent pools) or ensure greater access to innovations (such
as with compulsory licensing). Fourth, we notice that the whole STI ecosystem
has been rapidly refocusing on SARS-CoV-2 in a way similar to mission-oriented
R&D (MOR) programs such as the Manhattan Project in the 1940s. We highlight
the fundamental differences between MOR and the present situation. Today’s
response is characterized by a proliferation of a wide range of innovative
solutions offered by a complex set of institutions and actors with great
intellectual freedom and decentralized competition. The third part of the
report assesses some potential long-term impacts of the COVID-19 pandemic. We
firstly discuss its impact on R&D investment. We explain how innovation might
be negatively affected by a prolonged economic downturn and highlight the
crucial role of stimulus packages in confronting the recession. We also
address the influence of the crisis on ICT, arguing that it has been a
formidable catalyst for ICT adoption. Next, we focus on clean technologies,
another major societal challenge besides the pandemic. There are strong
reasons for why cleantech investment may suffer. However, the crisis also
offers significant opportunities to accelerate the green transition. Finally,
we focus on open science, in particular on open access and open data. The
current crisis could be a catalyst for the adoption of FAIR (Findable,
Accessible, Interoperable, and Reusable) Data Practices. The last part of the
report offers some concluding thoughts. The STI policy response cannot be
limited to the urgent need for ‘technological fixes.’ A second line of
response involves the production of new knowledge to prevent outbreaks
(ex-ante) or mitigate their effects (ex-post). Furthermore, the current crisis
is a reminder that all branches of science matter. The pandemic has many
facets, and a significant number of scientific disciplines can contribute to
dealing with it. We conclude with a forward-looking note, arguing that the
most substantial impact of the pandemic may lie outside of the public health
realm or the science system. It offers a unique opportunity to adapt the set
of rules that govern our society. |