On the second day of the New England Competitiveness Conversation, Tufts University President Sunil Kumar articulated the theoretical foundation for the event’s importance: the great need for collaboration among industry, government, and academia to foster innovation. For him, the answer lay in the work of Stanford Economists and Nobel Prize Laureate Kenneth Arrow, and his work answering the question of why the “invisible hand” of the market fails to achieve socially optimal outcomes. Innovation is a positive externality — the benefit society reaps from an innovation is far greater than the benefit the innovator directly obtains, so investment in innovation is lower than it should be to produce the best possible outcome.
Kumar highlighted that this inefficiency is especially pronounced in the blue and green economies, where societal gains significantly outweigh the rewards for developers. He called on government and academia to actively promote greater investment in these sectors. Concluding his remarks, Kumar expressed hope that the connections forged during the Conversation would catalyze increased investment in blue and green technologies, ultimately delivering greater value to all of society.
"The Blue and Green economies have strong positive externalities for society; you cannot rely solely on the market to develop them."
Dr. Sunil Kumar
President
Tufts University
