Philippe Aghion and Peter Howitt have been jointly awarded the 2025 Nobel Prize in Economic Sciences with Joel Mokyr ‘for having explained innovation-driven economic growth’. Aghion and Howitt were cited by the Nobel committee ‘for the theory of sustained growth through creative destruction’. As this column explains, their work transformed creative destruction from an evocative […]
At the beginning of my advocacy journey, I often searched for affordable ways to present myself at events. A friend of mine had launched a small clothing business, offering creative designs that young people like me could afford. She hired a tailor to bring her ideas to life, but struggled with rent and limited capital. […]
A key debate surrounding export controls is whether they accelerate innovation in targeted rivals. This column studies this question using a set of US export controls, the 2007 ‘China Rule’, by comparing sanctioned goods with goods just excluded from the policy. It finds that the policy reduced Chinese imports of restricted goods. It also finds […]
The digital age has ushered in an era of transformation for money, triggering debates about the role of cryptocurrencies, central bank digital currencies, stablecoins, and the possible encroachment of Big Tech into the monetary system. In the midst of this upheaval, central bankers, economists, and the private sector are grappling with fundamental questions about the […]
The low-carbon transition requires substantial financial mobilisation, yet it is unclear whether banks’ public climate commitments represent real change or simply greenwashing. This column uses unique survey data from 335 banks across 33 emerging markets to examine their internal green practices and lending approaches. The authors find that climate-committed banks score substantially higher on green […]
Technological innovation, including disruptive innovation, is a driving force for economic growth and social change, but early identification of such technologies and assessments of their impact are challenging. This column introduces recent approaches to identifying innovative and disruptive technologies from academic literature, with an application to Japanese research. The methods can help allow policymakers to […]
The launch of ChatGPT in late 2022 marked a turning point in how firms and investors view generative artificial intelligence. This column measures the extent and tone of firms’ discussions of GenAI in earnings calls, and finds that early engagement with AI topics boosted stock market performance beyond the immediate impact on expected earnings. The […]
Peter Drucker, often called the father of modern management, once wrote that “innovation is the specific instrument of entrepreneurship…the act that endows resources with a new capacity to create wealth.” In development, innovation does something similar: It endows resources with a new capacity to create outcomes. In turn, outcomes are what give innovation purpose. At […]
Tweaks to EU copyright requirements in the AI Act Code of Practice will maintain the AI growth momentum, for now – but will also create new challenges. As part of the implementation of the European Union’s Artificial Intelligence Act (Regulation (EU) 2024/1689), the European Commission has published several implementation guidelines, including the final Code of […]
Professional race cars and hydromet (weather, water, and climate forecasting) systems may seem worlds apart, but they have more in common than we realize. Both perform at high levels, requiring purpose-built designs and constant technological advancement, and for both, there are no off-the-shelf solutions. Every part needs to be acquired with overall compatibility and connectivity […]
