Economic Experiments and Innovation

This lecture explores the concept of economic experiments and innovation, emphasizing the differences from scientific experiments. It delves into the necessity of conducting economic experiments at full scale in the real economy to understand the properties of innovations. The lecture discusses the significant role of economic properties like consumer preferences, optimal pricing, and trust issues for private innovators. It also highlights the importance of institutions supporting economic discovery through laws, funding mechanisms, and intellectual property protection. The presentation addresses the challenges of experimentation costs, uncertainty, and the role of consumers in shaping the future of innovations. Additionally, it examines the funding mechanisms required for entrepreneurial experimentations, such as venture capital, stock markets, and state support.