One of the big topics of conversation here in Davos is the economy. In panel discussions and hallway conversations, people are talking about the long-term effects of the recession of 2009. While it’s true that we will see lingering unemployment and huge government deficits for quite some time, I think the big story is actually much more positive. I believe we can make amazing progress in the years ahead to improve people’s lives around the world. The key is to keep investing in innovation. It is what makes the difference between a bleak future and a bright one.
During the past two centuries, a huge number of innovations have fundamentally changed the human condition-more than doubling our life span and giving us cheap energy and more food. If we project what the world will be like ten years from now without continuing innovation in health, energy, or food, the picture is quite dark. Health costs for the rich will keep escalating, forcing tough trade-offs, and the poor will be stuck in the bad situation they are in today. We will have to increase the price of energy to reduce consumption, and the poor will suffer from both this higher cost and the effects of climate change. We will have big food shortages because we won’t have enough land to feed the world’s growing population.
But innovations will allow us to avoid these bleak outcomes. With vaccines, drugs, and other improvements, health in poor countries will continue to get better. With better seeds, training, and access to markets, farmers in poor countries will be able to grow more food. The world will find clean ways to produce electricity at a lower cost.
Although innovation is unpredictable, there is a lot that governments, private companies, and foundations can do to accelerate it. Rich governments need to spend more on research and development, for instance, and we need better measurement systems in health and education to determine what works.
These are the some of the things I’ll be emphasizing this week. I also talk a lot more about innovation in my 2010 annual letter, which was published this week on gatesfoundation.org. I’m very optimistic that with the right investments, innovation can help create a brighter future for everyone.
