Innovation is the result of freely exploring and combining ideas. Innovation flourishes with freedom. Innovation is hindered by laws and regulations.
The main ingredient in the secret sauce that leads to innovation is freedom. Freedom to exchange, experiment, imagine, invest and fail; freedom from expropriation or restriction by chiefs, priests and thieves; freedom on the part of consumers to reward the innovations they like and reject the ones they do not.
Some countries are more innovative than others. Some entrepreneurs work, experiment, play, and take risks more than others.
What explains this speed and breadth of innovation fury? In a word, work. Chinese entrepreneurs are dedicated to the 9–9–6 week: 9 a.m. to 9 p.m., six days a week. That was what Americans were like too when they changed the world (Edison demanded inhuman hours from his employees); and Germans when they were among the most innovative people; and Britons in the nineteenth century; and Dutch and Italians before that. Willingness to put in the hours, to experiment and play, to try new things, to take risks – these characteristics for some reason are found in young, newly prosperous societies and no longer in old, tired ones.
Innovation is similar to relationships. Relationships are formed when people mingle. Innovation is created when ideas mingle. Relationships are formed when individuals play, have fun, and have sex. Innovation happens when ideas play, have fun, and have sex.
Innovation happens, as I put it a decade ago, when ideas have sex. Innovation is the child of freedom, because it is a free, creative attempt to satisfy freely expressed human desires. Innovative societies are free societies, where people are free to express their wishes and seek the satisfaction of those wishes, and where creative minds are free to experiment to find ways to supply those requests – so long as they do not harm others. Innovation happens when ideas can meet and mate, when experiment is encouraged, when people and goods can move freely and when money can flow rapidly towards fresh concepts, when those who invest can be sure their rewards will not be stolen.