I always had my doubts about macroeconomics. Just the term “ceteris paribus” (all other things being equal) made me thoroughly suspicious. When has anything really been “ceteris paribus”? No day is like another and if I learnt one lesson in my previous industry, the insurance business – insuring big cargo and oil-platforms – it is to expect the unexpected.
Having worked at UK Trade and Investment for almost two years now, I have to admit that the old macroeconomics truths are starting to grow on me. I don’t claim to be an expert in the field, but for example, to grow the local economy via international trade seems to make a lot of sense based on my business experience. Another economic hypothesis that works well for me is the idea that innovation leads to more attractive goods or services, which will in turn lead to increased demand and to increased trade. So it was with particular satisfaction that I participated at the Innovate UK conference in London in mid-March.
The event was run as a joint venture by the Technology Strategy Board and UKTI. The audience consisted of business people, academics and legislators. The challenge was, and is, to encourage research and development, cooperation between universities and business and to assist the commercialisation of new ideas. In all, to make the UK more innovative and competitive and a more attractive cooperation and trading partner for all countries – not least for advanced economies like Sweden.
Companies presenting their innovative ideas included Versarien (which specialises in porous metals for heat transfer), SwiftKey (whose products make typing on smartphones easier) and Wellcow (which sells a product that monitors the health of cows – from inside the cow). It was fascinating to learn about how these and other ideas were taken from the drawing board or test tube and made into a real company. It seemed that most of the time it involved some form of research or invention or simply a good idea, some seed funding from governmental or other sources and not least some brave and stubborn entrepreneurs taking a chance on something they believe in. The stories underlined how important it is to support the interface between academia and business and how all of the abovementioned ingredients are really important for a well functioning economy.
Encouraging innovation, providing access to start-up funding and creating a society where entrepreneurship is stimulated are all important pieces of the puzzle for a country that aims to produce leading products and services that will increase trade and grow the economy.
But just like when the British scientist Alexander Fleming happened to discover penicillin by accident in 1928, we also have to be prepared for the unexpected and to be able to harness the unexpected to our advantage – ceteris paribus or not.