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Innovation is inefficient. More often than not, it is undisciplined, contrarian, and iconoclastic; and it nourishes itself with confusion and contradiction. In short, being innovative flies in the face of what almost all parents want for their children, most CEOs want for their companies, and heads of states want for their countries. And innovative people are a pain in the ass.

Yet without innovation we are doomed-by boredom and monotony-to decline. So what makes innovation happen, and just where do new ideas come from? The basic answers-providing a good educational system, encouraging different viewpoints, and fostering collaboration-may not be surprising. Moreover, the ability to fulfill these criteria has served the United States well. But some things-the nature of higher education among them-will have to change in order to ensure a perpetual source of new ideas.

One of the basics of a good system of innovation is diversity. In some ways, the stronger the culture (national, institutional, generational, or other), the less likely it is to harbor innovative thinking. Common and deep-seated beliefs, widespread norms, and behavior and performance standards are enemies of new ideas. Any society that prides itself on being harmonious and homogeneous is very unlikely to catalyze idiosyncratic thinking. Suppression of innovation need not be overt. It can be simply a matter of people’s walking around in tacit agreement and full comfort with the status quo.

A very heterogeneous culture, by contrast, breeds innovation by virtue of its people, who look at everything from different viewpoints. America, the so-called melting pot, is seen by many as having no culture (with either a capital C or a lowercase c). In rankings of students in industrial countries, U.S. high school students come across as average, at best, in reading, mathematics, and science. And unfortunately, the nation is unrivaled in gun-related crimes among young people. Yet, looking back over the past century, the United States has accounted for about a third of all Nobel prizes and has produced an unrivaled outpouring of innovations-from factory automation to the integrated circuit and gene splicing-that are the backbone of worldwide economic growth.

I see two reasons for this. One is that we do not stigmatize those who have tried and been unsuccessful. In fact, many venture capitalists are more, not less, likely to invest in somebody who has failed with an earlier startup than in someone who is launching his or her first company. The real disappointment is when people do not learn from their mistakes.

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