Productivity needs a new yardstick. That’s according to a new report from the Brookings Institution released Tuesday and titled “Smart Policy, Building an Innovation-Based Economy.”
The report makes a series of recommendations for policymakers culled from a day-long workshop held in June 2012 and the crowd-sourced responses from experts in innovation, economic development and technology.
The authors outline four “primary goals” for policymakers to strengthen the economy. These include making sure that the conditions are right for the promotion of innovation and entrepreneurship, improving the nation’s digital infrastructure, making government more effective and efficient by “leveraging the digital economy” and improving the ways we transmit knowledge to foster a better-trained workforce.
The big takeaway, however, is how the nation measures productivity: In a nutshell, write the authors, we’re doing it wrong.
“We need to improve our information measuring systems for the 21st century economy,” said Darrell West, vice president and director of governance studies at Brookings. “When you look at our measures of productivity, for example, we’re really measuring the old economy much more so than the new economy.”
The report calls for “more nuanced production measures other than worker hours or total employees in relation to GDP.”
“We just need a better way to think about the 21st Century Economy,” said West, one of three co-authors of the study and also the founding director of the Center for Technology Innovations at the think tank.
Given that the White House and Congress failed to reach a grand bargain on the “fiscal cliff,” it begs the question whether broader initiatives, such as passing the Dream Act or updating the Federal Security Management Act, are even possible.
“We certainly can address many of these issues in the next two to four years if there is a political will to do so,” said West, “I’m optimistic that many of the changes we recommend in the education area have great potential.”
West and his team will be publishing reports that address each of the proposals in greater depth throughout the year, and in March the think tank will host a forum on education technology.
The report, while not a page-turner, is a window into what the think tank’s innovation arm will be focusing on in the next year and comes just in time for the beginning of President Obama’s second term and the arrival of the new Congress.
“We need to move beyond the buzzword of innovation to concrete proposals for change,” said West, when asked whether the report may ring hollow for lawmakers inundated with talk of innovation. “That’s what we have to address in order to have maximum impact.”
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