Matt Ridley’s How Innovation Works was finished before the COVID-19 pandemic stopped the world but it could not be more timely in describing the conditions that we need to innovate ourselves out of our global crisis. 

The book is a Part 2 to The Rational Optimist: How Prosperity Evolves, or perhaps more of a prequel as he argues that innovation, itself a process of evolution rather than a moment of inspiration, is a fundamental ingredient of prosperity. So, what are the conditions for innovation to thrive?

First, innovation is not to be confused with invention, words which I might have used interchangeably before reading this book. ‘Invent’ is more discover than create, ‘innovation’ is a process of renewal rather than being unique or original. 

And that is the central point. Innovation is an organic process that needs patience, many hands, luck and the right timing. Most graphically, the book showcases the many trials and errors that are necessary for innovation to succeed. From the Wright brothers’ endless adjustments and gradual improvements that saw them finally take flight to Jeff Bezos’s “we need big failures in order to move the needle” that has made Amazon what it is today, How Innovation Works celebrates the freedom to fail.

As with Ridley’s journalism, the book is teeming with the stories of people and their extraordinary perseverance, resilience, passion and compassion that bring to life his statistics and academic research. 

Lady Mary Wortley Montagu, “learned, eloquent and witty” who “cut a swathe through literary London” had her great beauty scarred by smallpox. It is what led her to become an innovator in the field of inoculation. Her husband was appointed ambassador in Constantinople in 1716 where she came across ‘engrafting’ as a cure for smallpox – the practice of mixing the pus from a smallpox survivor with the blood of a healthy person through a scratch on the arm. 

Although there had been reports of this before, they had been rejected by London’s experts as dangerous witchcraft. Lady Mary not only saw it work, she had such faith in it that she engrafted her children. It wasn’t until the end of the 1700s that inoculation was replaced by vaccination with a less dangerous virus than smallpox. Innovation is gradual and often needs real bravery. 

The potato is another example of innovation – this time its inexorability in the face of prejudice and vested interest

Too often a brilliant innovation runs into prejudice and vested interests. The potato, for example, was banned in some parts of England as late as the early eighteenth century. Why? Because it’s not mentioned in the bible. Not just that, the English clergy encouraged their parishioners to believe that potatoes were Roman Catholic agents. Chants of “No potatoes, no popery!” are recorded in Lewes during an election rally in 1765. Then as now, innovation often has to face down political or religious myth-making to succeed. 

But the potato, grown underground and therefore immune to the feet of soldiers destroying crops during wars, hardy even in wet weathers that rotted the grain crops on the surface, so nutritious that people grew plump and populations exploded, won out. The potato is another example of innovation – this time its inexorability in the face of prejudice and vested interest.

The problems faced by the potato are remarkably similar to those that prevented genetically-modified food more recently with environmental campaign groups taking the place of eighteenth century clergy. The book is as strong on what crushes innovation as it is on what allows it to bloom – in this case the modified wheat that nearly didn’t arrive in India and Pakistan in time to save millions from mass starvation. 

The monstrous combination of Indian scientists and administrators believing that “Poverty is the farmers’ lot; they are used to it”, a high level of risk aversion (what if the crops failed?) and the opposite – fear of what would happen if they succeeded (would social tensions increase if one set of farmers made more money than others?) nearly did for an innovation that would save millions of lives. In the West, meanwhile, a group of ecologists and environmentalists were arguing that it was already too late to help the starving and that aid would be a waste for “can’t-be-saved nations”. The story demonstrates how strong – and deadly – the forces of status quo can be. 

It took fifty years of geneticists around the world cooperating and recombining, the evolution of nitrogen fertiliser and a relentless campaign for innovation, but India, once on the brink of mass starvation became a wheat exporting nation. 

The parallels with today’s use of the ‘precautionary principle’ to stop innovation are striking. Coffee houses have over the last four centuries been smashed up and suppressed. Powerful rulers feared that they gave opportunities for people to meet, gossip and plan sedition. Powerful wine and beer lobbies feared the competition. The result? Familiar pseudo-science about coffee drying the kidneys and making people exhausted and impotent so reminiscent of the campaigns against e-cigarettes and GMOs today. 

Ironically, risk aversion and vested interests increase the more prosperous we become. As the innovative forces of creative destruction are replaced by crony-capitalism, as comfort and wealth become the norm for a greater number of people, the less likely they are to embrace change or renewal. 

It is why How Innovation Works is so important today. The virus with no cure or vaccine (as yet) is shaking us. We have become “dulled by complacency”. We need to wake up and realise that we have been neglecting innovation, particularly in vaccine development.

As he says, his book is not as upbeat as The Rational Optimist was, but he is, nevertheless, always positive about the limitless capabilities of the human race, especially in a crisis. And his recipe for innovation – that it is evolutionary, a recombination of bits of work from different fields and teams of people, that it needs the freedom to fail and the courage of conviction, the bravery to fight the established forces that feed off the status quo – these are all needed in big doses today if we are to succeed against COVID-19. 

The time is certainly ripe for innovation. It’s up to us to create the conditions that allow it to flourish.