Economics of Ideas, Science and Innovation Syllabus

Instructors Syllabus Apply

Course Overview

This course begins by establishing fundamental ways in which ideas differ from other goods. The course then uses these concepts to evaluate the origins of economic growth, the role of science and science institutions, innovation incentives (through market structure, intellectual property, and organizational practices), the diffusion of innovations and their implications for inequality, and the geography of innovation. Though squarely anchored in the economics discipline, the course will also draw on the sociology of science, particularly classic Mertonian frameworks for understanding the scientific incentive system, scientific labor markets, and scientific norms.

The course will consist of 13 Zoom lectures on Tuesdays: February 3, February 10, February 17, February 24, March 3, March 10, March 17, March 24, March 31, April 7, April 14, April 21, and April 30 (our only Thursday class) from 1:30 – 3:30pm EST.

The course will introduce both macroeconomic and microeconomic approaches for assessing the “ideas production function,” with special attention to the roles of human capital, institutions, and incentive systems. The course emphasizes how the unusual characteristics of ideas can result in social inefficiency, and how the microeconomic and institutional environment influences the gap between private and social welfare. Altogether, in tandem with theoretical approaches, this course substantially reviews core empirical literature, including a modern array of methods and data sets that are suited to studying ideas and innovation, and aims to provide students with an extensive toolkit to undertake innovation research.

Who can register for the course?

Our target audience is current or recent students who have completed at least one year of a PhD program in economics or related fields. Acceptance, however, is not guaranteed. To register, we ask for (1) a very short statement (not a recommendation letter) from an academic advisor or administrator on his/her official letterhead certifying that you are regularly enrolled in a PhD program or evidence you have completed a PhD in economics or closely related field; and (2) a maximum two-minute video in which you introduce yourself and explain what you hope to gain from this class.

Requirements:

  • In spite of the fact that the course will be delivered on Zoom, this is not a MOOC, but rather is a real course; participation is expected. Registration will be free, but attendance and engagement is required. It is the responsibility of students to secure a quiet location, with adequate internet access, and to turn (and leave) their webcam on.  If you are interested in the material but unable to commit to attending every lecture and reading group meeting, faculty will be making slides publicly available on our course website.

Course Logistics

The course has four main components:

  • Weekly zoom lectures
  • Weekly small group paper reading clubs
  • Online happy hours
  • Class Discord server

Zoom Lectures

The course will consist of 13 two-hour synchronous zoom lectures on Tuesdays (and one Thursday) between February 3 and April 30 from 1:30-3:30pm EST. 

We want our lectures to be participatory, and so ask students to attend with cameras on, ready to discuss the readings. Specifically, reading groups will be assigned specific papers to read, and we will call on group members during lecture to discuss papers. Lectures will not be recorded, though we will post slides.

Small Group Paper Reading Clubs

You will be assigned to a group of 3-4 students in nearby timezones. Each week, we will assign a paper to your group. You should arrange to meet via zoom with your group prior to class to discuss this paper. This discussion should center on:

  • What question is the paper trying to answer?
  • Why should we care?
  • How does the paper try to answer this question?
  • What do you think the paper did well?
  • What criticisms do you have of the paper?

We will call on groups during lecture to discuss the papers they read.

Online Happy Hours

After each lecture, there will generally be an opportunity to meet with the course instructor in a smaller group setting.

We will cap the number of attendees at each of these events. You should rank your preference over these meetings using the pre-class survey you will have received in your email. Note attendance of these happy hours is optional.

Class Discord Server

Upon completion of the pre-class survey, you should receive an invitation to sign up for the course Discord server. We hope you will use this to communicate with the instructors and other students in a more informal setting than will be possible during the course lectures. In lieu of office hours, please post questions and comments about the course content directly to the slack channel, which the instructors will be monitoring.

Other Details

The course website remains ifp.org/economics-of-ideas. We will be posting course slides here, as well as our reading list. 

If you have any questions about the course in general, please contact us at courses@ifp.org

Schedule at a Glance

Class 1 Introduction to the Economics of Ideas February 3 Benjamin Jones
Class 2 Idea-Based Models of Economic Growth February 10 Chad Jones
Class 3 The Supply of Innovators February 17 Ina Ganguli
Class 4 Open Science as an Economic Institution February 24 Pierre Azoulay
Class 5 The Direction of Science March 3 Kyle Myers
Class 6 Science and the Returns to R&D March 10 Matt Clancy
Class 7 AI and Innovation March 17 Kevin Bryan
Class 8 Innovation Policy March 24 John Van Reenen
Class 9 Immigration and Innovation March 31 Michael Clemens
Class 10 Regulation April 7 Heidi Williams
Class 11 Competition and Innovation April 14 Mitsuru Igami
Class 12 Patent Policy April 21 Janet Freilich
Class 13 Wrap-Up: Advice on Research and Careers April 30 Matt Clancy, Caleb Watney,
Heidi Williams

Class 1

Introduction to the Economics of Ideas

Benjamin Jones

  • Arrow, Kenneth. “Economic Welfare and the Allocation of Resources for Invention.” In The Rate and Direction of Inventive Activity: Economic and Social Factors (1962). Princeton, NJ: Princeton University Press, 609-625.
  • Jones, Benjamin F. and Summers, Lawrence H.  “A Calculation of the Social Returns to Innovation.” In Innovation and Public Policy, University of Chicago Press (2021).
  • Bloom, Nicholas, Mark Schankerman,  and John Van Reenen. “Identifying Technology Spillovers and Product Market Rivalry.” Econometrica 81(4) (2013): 1347-1393.
  • Jones, Benjamin F. “The Burden of Knowledge and the ‛Death of the Renaissance Man’: Is Innovation Getting Harder?” Review of Economic Studies 76(1) (2009): 283-317.

Class 2

Idea-Based Models of Economic Growth

Chad Jones

  • Bloom, Nicholas, Charles I Jones, John Van Reenen, and Michael Webb. “Are Ideas Getting Harder to Find?” American Economic Review 110, no. 4 (2020): 1104-1144.
  • Jones, Charles I. “Growth and Ideas.” Handbook of Economic Growth 1B (2005): 1063-1111.
  • Jones, Charles I. and Christopher Tonetti. “Past Automation and Future A.I.: How Weak Links Tame the Growth Explosion.” Stanford unpublished manuscript (2025).
  • Jones, Charles I. “The Past and Future of Economic Growth: A Semi-Endogenous Perspective.” Annual Review of Economics 14, (2022): 125-152.
  • Romer, Paul M. “Endogenous Technological Change.” Journal of Political Economy 98, no. 5 (1990): S71-S102.

Class 3

The Supply of Innovators

Ina Ganguli

  • Agarwal, R. and P. Gaule. Invisible geniuses: Could the knowledge frontier advance faster? American Economic Review: Insights, 2(4) (2020): 409-24.
  • Bell, Alexander M., Raj Chetty, Xavier Jaravel, Neviana Petkova, and John Van Reenen. “Who Becomes an Inventor in America? The Importance of Exposure to Innovation.” Quarterly Journal of Economics 134(2) (2019): 647-713. 
  • Ganguli, I., P. Gaulé, and D.V. Čugalj, Chasing the academic dream: Biased beliefs and scientific labor markets. Journal of Economic Behavior & Organization, 202 (2022): 17-33.
  • Waldinger, Fabian. “Bombs, Brains, and Science: The Role of Human and Physical Capital for the Production of Scientific Knowledge,” The Review of Economics and Statistics, vol. 98, no. 5 (2016): 811-831

Class 4

Open Science as an Economic Institution

Pierre Azoulay

  • Dasgupta, Partha, and David Paul. 1994. “Towards a New Economics of Science.” Research Policy 23(5): 487-521.
  • Merton, Robert K. 1957. “Priorities in Scientific Discovery: A Chapter in the Sociology of Science.” American Sociological Review 22(6): 635-659.
  • (*)Azoulay, Pierre, Toby Stuart, and Yanbo Wang. 2014.  “Matthew:  Effect or Fable?”  Management Science 60(1): 92-109.
  • Murray, Fiona, Philippe Aghion, Mathias Dewatripont, Julian Kolev, and Scott Stern. 2016. “Of Mice and Academics: Examining the Effect of Openness on Innovation.” American Economic Journal: Economic Policy 8(1): 212-252.
  • (*)Stern, Scott. 2004. “Do Scientists Pay to Be Scientists?” Management Science 50(6): 835-853.
  • (*)Aghion, Philippe, Mathias Dewatripont, and Jeremy C. Stein. 2008. “Academic Freedom, Private Sector Focus, and the Process of Innovation.” RAND Journal of Economics 39(3): 617-635.
  • (*)Furman, Jeffrey, and Scott Stern. 2011. “Climbing Atop the Shoulders of Giants: The Impact of Institutions on Cumulative Knowledge Production.” American Economic Review 101(5): 1933-1963.
  • (*)Hill, Ryan, and Carolyn Stein. 2025. “Race to the Bottom: Competition and Quality in Science.” Quarterly Journal of Economics 140(2): 1111-1185.

    Note: students should read starred papers for class. 

Class 5

The Direction of Science

Kyle Myers

  • Carnehl, Christoph, Marco Ottaviani, and Justus Preusser. “Designing Scientific Grants.” Entrepreneurship and Innovation Policy and the Economy 4.1 (2025): 139-178.
  • Hegde, Deepak, and Bhaven Sampat. “Can private money buy public science? Disease group lobbying and federal funding for biomedical research.” Management Science 61.10 (2015): 2281-2298.
  • Myers, Kyle. “The elasticity of science.” American Economic Journal: Applied Economics 12.4 (2020): 103-134.
  • Acemoglu, Daron. “Diversity and technological progress.” The Rate and Direction of Inventive Activity Revisited. University of Chicago Press, 2011. 319-356
  • Carnehl, Christoph, and Johannes Schneider. “A quest for knowledge.” Econometrica 93.2 (2025): 623-659.

Class 6

Science and the Returns to R&D

Matt Clancy

  • Azoulay, Pierre, Joshua S. Graff Zivin, Danielle Li, and Bhaven N. Sampat. 2019. Public R&D Investments and Private-sector Patenting: Evidence from NIH Funding Rules. The Review of Economic Studies 86(1): 117-152.
  • Dyevre, Arnaud. 2024. Public R&D Spillovers and Productivity Growth. Working paper.
  • Fieldhouse, Andrew, and Karel Mertens. 2023. The Returns to Government R&D: Evidence from U.S. Appropriations Shocks. Federal Reserve Bank of Dallas Working Paper 2305.
  • Fieldhouse, Andrew J., and Karel Mertens. 2025. The Social Returns to Public R&D. NBER Working Paper 33780.
  • Myers, Kyle, and Lauren Lanahan. 2022. Estimating spillovers from publicly funded R&D: Evidence from the US Department of Energy. American Economic Review 112(7): 2393-2423.

Class 7

AI and Innovation

Kevin Bryan

  • David, P. A. 1990. The dynamo and the computer: An historical perspective on the modern productivity paradox. American Economic Review, 80(2), 355–361.
  • Agrawal, A., Gans, J. S., & Goldfarb, A. 2018. Exploring the impact of artificial intelligence: Prediction versus judgment (NBER Working Paper No. 24626). National Bureau of Economic Research.
  • Shahidi, P., Rusak, G., Manning, B. S., Fradkin, A., & Horton, J. J. (2025). The Coasean singularity? Demand, supply, and market design with AI agents. In The economics of transformative AI. University of Chicago Press. 
  • Patwardhan, T., Dias, R., Proehl, E., Kim, G., Wang, M., Watkins, O., Fishman, S. P., Aljubeh, M., Thacker, P., Fauconnet, L., Kim, N. S., Chao, P., Miserendino, S., Chabot, G., Li, D., Sharman, M., Barr, A., Glaese, A., & Tworek, J. (2025). GDPval: Evaluating AI model performance on real-world economically valuable tasks. arXiv.
  • Ide, E., & Talamàs, E. (2025). Artificial intelligence in the knowledge economy. Journal of Political Economy.
 

Class 8

Innovation Policy

John Van Reenen

  • Akcigit, Ufuk, John Grigsby, Tom Nicholas,  and Stefanie Stantcheva. “Taxation and Innovation: What Do We Know?” In Innovation and Public Policy, edited by Benjamin Jones and Austan Goolsbee, Chicago: University of Chicago Press (2022).
  • Bloom, Nicholas, John Van Reenen, and Mark Schankerman. “Identifying Technology Spillovers and Product Market Rivalry.” Econometrica 81, no. 4 (2013): 1347–1393.
  • Bloom, Nicholas, John Van Reenen, and Heidi Williams. “A Toolkit of Policies to Promote Innovation.” Journal of Economic Perspectives 33, no. 3 (2019): 163–184.
  • Dechezleprêtre, Antoine, Elias Einiö, Ralf Martin, Kieu-Trang Nguyen, and John Van Reenen. “Do tax incentives for research increase firm innovation? An RD Design for R&D.” American Economic Journal: Economic Policy, forthcoming.
  • Kerr, Sari and William R. Kerr. “Immigration Policy Levers for US Innovation and Start-Ups.” In Innovation and Public Policy, edited by Benjamin Jones and Austan Goolsbee, Chicago: University of Chicago Press (2022).

Class 9

Immigration and Innovation

Michael Clemens

Readings coming soon!

Class 10

Regulation

Heidi Williams

  • Budish, Eric, Benjamin N. Roin, and Heidi Williams. 2015. “Do Firms Underinvest in Long-Term Research? Evidence from Cancer Clinical Trials.” American Economic Review 105 (7): 2044–85.
  • Elmendorf, Douglas, Glenn Hubbard, and Zachary Liscow. 2025. “Policies to Reduce Federal Budget Deficits by Increasing Economic Growth.” In NBER Entrepreneurship and Innovation Policy and the Economy, volume 5, edited by Benjamin Jones and Joshua Lerner.
  • Liscow, Zachary. 2025. “Getting Infrastructure Built: The Law and Economics of Permitting.” Journal of Economic Perspectives 39 (1): 151–80.
  • Peltzman, Sam. 1973. “An Evaluation of Consumer Protection Legislation: The 1962 Drug Amendments.” Journal of Political Economy 81 (5): 1049-1091.

Class 11

Competition and Innovation

Mitsuru Igami

  • Aghion, Philippe, Nick Bloom, Richard Blundell, Rachel Griffith, and Peter Howitt. 2005. “Competition and Innovation: An Inverted-U Relationship.” The Quarterly Journal of Economics 120, no. 2: 701–28.
  • Cunningham, Colleen, Florian Ederer, and Song Ma. 2021. “Killer Acquisitions.” Journal of Political Economy 129, no. 3: 649–702.
  • Gilbert, Richard J., and David M. Newbery. 1982. “Preemptive Patenting and the Persistence of Monopoly.” The American Economic Review 72, no. 3: 514–26.
  • Igami, Mitsuru, and Kosuke Uetake. 2020. “Mergers, Innovation, and Entry-Exit Dynamics: Consolidation of the Hard Disk Drive Industry, 1996–2016.” The Review of Economic Studies 87, no. 6: 2672–2702.
  • Petrin, Amil. 2002. “Quantifying the Benefits of New Products: The Case of the Minivan.” Journal of Political Economy 110, no. 4: 705–29.

Class 12

Patent Policy

Janet Freilich

  • Feng, Josh and Xavier Jaravel. “Crafting Intellectual Property Rights: Implications for Patent Assertion Entities, Litigation, and Innovation.” American Economic Journal: Applied Economics 12(1) (2020):140-181 
  • Freilich, Janet and Soomi Kim. “Is the Patent System Sensitive to Incorrect Information?” The Review of Economics and Statistics (forthcoming)
  • Hall, Bronwyn and Rosemarie Ziedonis. “The Patent Paradox Revisited: An Empirical Study of Patenting in the U.S. Semiconductor Industry, 1979-1995.” RAND Journal of Economics 32(1) (2001):101-128 
  • Hemphill, C. Scott and Bhaven Sampat. “When do Generics Challenge Drug Patents?” Journal of Empirical Legal Studies 8(4) (2011): 613-649 
  • U.S. Patent No. 4,833,729

Class 13

Wrap-Up: Advice on Research and Careers

Matt Clancy, Caleb Watney,
Heidi Williams

  • Clancy, Matt, Dan Correa, Jordan Dworkin, Paul Niehaus, Caleb Watney, and Heidi Williams “To Speed Scientific Progress, Understand How Science Policy Works.” Nature 620 (2023): 724-726.
  • Metascience 101 podcast: https://www.macroscience.org/podcast, especially Episode 9 “How to Get Involved”