Production in the Innovation Economy

Production in the Innovation Economy emerges from several years of interdisciplinary research at MIT on the links between manufacturing and innovation in the United States and the world economy. (This ambitious research project is described in Making in America: From Innovation to Market, also published in 2013 by the MIT Press.) Authors from political science, economics, business, employment and operations research, aeronautics and astronautics, mechanical engineering, and nuclear engineering come together to explore the extent to which manufacturing is key to an innovative and vibrant economy.

Chapters include survey research on gaps in worker skill development and training; discussions of coproduction with Chinese firms and participation in complex manufacturing projects in China; analyses of constraints facing American start-up firms involved in manufacturing; proposals for a future of distributed manufacturing and a focus on product variety as a marker of innovation; and forecasts of powerful advanced manufacturing technologies on the horizon. The chapters show that although the global distribution of manufacturing is not an automatic loss for the United States, gains from the colocation of manufacturing and innovation have not disappeared. The book emphasizes public policy that encourages colocation through, for example, training programs, supplements to private capital, and interfirm cooperation in industry consortia. Such approaches can help the United States not only to maintain manufacturing capacity but also, crucially, to maximize its innovative potential.