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Will technology innovation eventually help lead the economy out of recession?  Simon Johnson of the MIT Sloan School of Management is predicting "a wave of entrepreneurship,"  which will start "right away" but whose total effect won't be felt for about five years, according to a recent article in The Boston Globe.Â
“Highly skilled labor should be reallocated away from the financial industry towards more innovative sectors” of the economy, writes MIT economist Daron Acemoglu in a new essay.
As he analyzed the financial crisis for Newsweek, Johns Hopkins professor Francis Fukuyama contrasted Silicon-Valley-style technological innovation and financial innovation. Supporters of financial regulation, Fukuyama wrote, had
argued that long-standing regulations like the Depression-era Glass-Steagall Act (which split up commercial and investment banking) were stifling innovation and undermining the competitiveness of U.S. financial institutions.
Maybe it was a case of the "not-invented-here" syndrome — the common phenomenon where organizations aren't open to innovations or ideas they didn't come up with — in Washington.  Or maybe it was just the pressure of time.
Right now, it's hard to escape being inundated with new headlines about the financial crisis. But amid the din of ever-changing news soundbites, it's not easy to make sense of the bigger picture.
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As Wall Street staggered this week in the wake of Lehman Brothers' Chapter 11 bankruptcy filing and the sale of Merrill Lynch, commentators began making inevitable comparisons to Japan's long-lasting financial and real-estate crisis in the 1990s. "Is Wall Street's Crisis Turning Japanese?" Forbes.com asked.Â
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