Beyond “Failure Tolerance”
In recent years, many discussions of innovation policy have emphasized the need to “tolerate failure.” While I strongly agree with this principle, I worry that the slogan risks diverting attention from a more fundamental issue: the structure of research evaluation and the design of public R&D investment. Encouraging risk-taking alone does not explain why the descendants of successful entrepreneurs in countries such as Japan and Korea often become effective long-term managers and R&D investors, nor why governments that rely heavily on expert committees frequently struggle to achieve comparable innovation outcomes. The repeated call to “accept failure” can therefore oversimplify the problem. Many researchers are not avoiding risk because they fear failure. Rather, the structure of academic incentives often encourages work that is theoretically elegant and readily publishable rather than work that addresses long-term, system-oriented technological challenges. As a result, res...