When Lindbergh made his successful transatlantic flight, it was to win a contest that catalyzed competition and innovation in the field of aviation. Inspired by the lesson of the Orteig Prize, the various Global Impact Competition contests around the world award a scholarship for Singularity University’s Global Solution Program for innovators that want to positively impact the world with the power of their exponential ideas.
One of the first to broadly leverage these mechanisms was Peter Diamandis, with XPRIZE. The Ansari X-prize spurred a race for the first private human space-flight. There are now many new prizes that are pursued by teams around the world. An interesting feature of the mechanism around the prizes is that the teams in total spend many times the amount of the prize that they have a chance of winning, achieving a multiplying effect of the passion and innovation around the topic.
Peter is also one of the founders of Singularity University, together with Ray Kurzweil. Singularity University’s flagship course is the Global Solutions Program of ten weeks in the summer, and applications are open to be part of it for the 2016 edition.
On top of applying directly, there are many country-level competitions organized by alumni and sympathizers of Singularity University. The Global Impact Competition selects people who are passionate about positively impacting the world through the power of technology applied to solving our grandest challenges.
After organizing it in 2012, ’13 and ’14 with Axelera, the contest is going to be launched soon in Italy as well, through the local Chapter of Singularity University, SingularityU Milan.
For the first time, on top of corporate sponsors, the fundraising of the contest also allows individuals to participate, by supporting its crowdfunding campaign on Indiegogo.
It’s been years since I looked into the economics of all this. What I remember finding:
(1) Most startups succeed by licensing patents from big companies that have big corporate research labs. The patents are deemed to be useless or even dangerous by these big corporations, since commercialization of the inventions would either cannibalize existing product lines or else divert top executive attention to the very distracting task of starting something completely new. So instead, farm it out to the entrepreneurial arena and hope to collect rent on the idea.
(2) Most patents come out of the research labs of corporations in some oligopoly constellation. Economists have long known that oligopolies collude for the sake of safe returns for their stockholders. They are hardly better than monopolies in terms of their /potential/ pricing power. But what is their actual pricing power? In reality, short of monopolistic. Most anti-trust policy analysts know what those economists have said on the matter. Anti-trust law is softer on oligopolies than on monopolies because oligopolies produce innovation in “peacock tail” R&D labs — innovation that often improves people’s lives whether it’s commercialized by the oligopolies or by licensees. The goose that lays the golden eggs gets to make it safe profit as long as it keeps laying (fed as necessary with R&D tax credits) and as long as it maintains the appearance of competing with other oligopoly members.
As Schumpeter had it, it was innovation, not competition, that was the soul of capitalism. He pointed out that pure competition could produce a monopoly complex as stiflingly hierarchical as any socialism.
What I concluded from all this: The primary engine of innovation in industrial democracies is the Tolerated Oligopoly — virtual monopoly power that is deterred from price-power abuse by the looming threat of anti-trust action, but at the same time camouflaged in the eyes of the buying public as “competitive” because of apparent brand competition — and apparent lack of anti-trust /action/. In true competition, we’d be paying less in the moment, for any given thing. But we would be paying less by financing less innovation in the future, and thus lose out over the long run.