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Psychology and the economics of invention

Published online by Cambridge University Press:  20 November 2019

Robert C. Allen*
Affiliation:
Faculty of Social Science, New York University Abu Dhabi, Saadiyat Island, Abu Dhabi, United Arab Emirates. bob.allen@nyu.eduhttps://nyuad.nyu.edu/en/academics/divisions/social-science/faculty/robert-allen.html

Abstract

Invention is an investment in which the costs of the Research and Development (R&D) project balance future returns. Those returns depend on objective factors like wage and capital costs but also on subjective factors because they are future projections. The more optimistic the inventor, the higher are the projected returns. Baumard uses Life History Theory (LHT) to relate optimism to the affluence of inventors and their societies.

Type
Open Peer Commentary
Copyright
Copyright © Cambridge University Press 2019 

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