Three Big Ideas #9
Three Big Ideas #9
Tacking from Tariff Man, reshaping social sciences, and material scientific progress from AI
Welcome to our weekly Three Big Ideas roundup, in which we serve up a curated selection of ideas (and our takes on them) in entrepreneurship, innovation, science and technology, handpicked by the team.
🚧 Eamonn Ives, Research Director
Donald – self-annointed ‘Tariff Man’ – Trump is returning to the White House. Central to his economic agenda for America is to introduce steep tariffs on imported goods. True to form, the exact details are sketchy, but Trump has suggested anything between 10-20%, and even higher rates for Mexico and China – 100%, 200%, or even 1,000% – which he blames for eroding America’s manufacturing base.
One of the most common justifications for tariffs is known as the ‘infant industry argument’ – which states that taxes on imports can keep out foreign competition, shield domestic companies, and therefore enable them to mature and one day become competitive. Tariffs should be thought of as the stabilisers you have on while you’re first learning to ride a bike, so this theory suggests.
With impeccable timing, however, a new working paper casts doubt on this idea. Authors Alexander Klein and Christopher M. Meissner studied the relationship between tariffs and labour productivity in US manufacturing between 1870 and 1909, and found that the former categorically reduced the latter. They also go further, and suggest that the reason this occurred was because tariffs generally enabled a greater number of smaller, less productive firms to stick around, which otherwise would have been competed out of existence – exactly the opposite of what fans of the infant industry argument tend to argue. Nobody celebrates small businesses going to the wall, but we’ve known for a while how important creative destruction is for economic growth.
One of the other more harmful aspects of tariffs is that they invariably induce other nations to follow suit with retaliatory tariffs – in other words a ‘trade war’. Whether in fashion or food or beyond, we have a tendency to copy our transatlantic counterparts. For the sake of the economy, let’s hope we draw the line at trade policy.
🧩 Anastasia Bektimirova, Researcher
I spent last Friday at the newly refurbished British Academy, where the space now blends tradition with modern ambition, as if reflecting a reimagining of social sciences and humanities themselves – the fields that the Academy has championed for a century. Fittingly, I was there for the reSHAPE conference. It showcased the achievements, opportunities, and challenges of turning research coming from social sciences, humanities and the arts (SHAPE) into impactful products and services, or deep social ventures, directly tackling societal problems. I shared some takeaways here.
There was a lot of talk about “changing the culture.” The rooms were buzzing with founders, academics, investors, and government officials eager to explore the frontiers of real-world SHAPE research impact. But, as one of the organisers told me, this relatively small group represented about 90% of the community – a sign that there is still some way to go until there is a bigger pipeline of strong (i.e. investable and scalable) commercialisation ideas coming from SHAPE research, and that the broader academic community needs to be taken on a journey.
The puzzle is: how? Questions, such as: “how to get academic researchers more interested in real-world questions?” or “how to get social science and humanities university departments to use the word ‘commercialisation’ less hesitantly?” don’t immediately strike me as ones for government policy to tackle. But I consistently hear the hope that the Government’s five missions being big strategic themes rather than specific disciplinary areas offer a good opportunity for the SHAPE research community to demonstrate its impact potential. The new R&D Missions Programme is a helpful signal, but social inertia is often a stumbling block for otherwise promising interventions.
One way to make targeted funding work is to diversify the forms of research output that funders ask for when awarding grants. As it stands, this could do with more ambition and outside-the-box thinking. Yesterday, the Advanced Research and Invention Agency (ARIA) CEO Ilan Gur told the Lords Science and Technology Committee that an ARIA programme would be considered a success if it produces a new capability that “would have changed the conversation globally about what’s possible or valuable in a space.” We need a similar ambition in how we approach the research impact of social sciences and humanities.
🧑🔬 Philip Salter, Founder
When Caleb Watney tweets “This is the best paper written so far about the impact of AI on scientific discovery”, it’s time to stop scrolling and start reading.
Artificial Intelligence, Scientific Discovery, and Product Innovation, by Aidan Toner-Rodgers finds that AI-assisted researchers discovered 44% more materials, leading to a 39% increase in patent filings and a 17% rise in product innovations. Critically, the use of AI seems to present an opportunity for more radical innovation, with the paper finding increased novelty in all stages of R&D.
As the paper states: “These effects are large. To put the rise in materials discovery in perspective, the lab’s research output per scientist declined by 4% over the preceding five years. This was despite the introduction of several computational tools designed to aid scientists. AI therefore appears to be a different class of technology, with impacts that are orders of magnitude greater than previous methods.”
While being mindful of these caveats, this could point the way to a new era of human progress. It also presents a challenge to individual scientists. Top-performing scientists benefited disproportionately, which would make many scientists redundant. And while it automates tedious tasks, the paper suggests AI may also reduce creativity and job satisfaction for scientists – or at least for the sort of people who currently become scientists.
Whatever the future holds for scientists, ultimately we shouldn’t forget one of Adam Smith’s great insights: “Consumption is the sole end and purpose of all production.” And on that front, things are looking bright.