Does Technological Innovation Divide Economic Growth From Sustainable Development?

Introduction

Policymakers, businesspeople, and academicians have found that effective innovation systems in the current geopolitical world conditions, where technology and innovation play leading roles (OECD, 2015b), along with effective public policies and private sector strategies, have improved indicators of competitiveness and economic growth in a number of regions (Paskaleva, 2011).

The improvement of competitiveness has been confirmed in cities that have been great pullers of innovation (Florida, 2006). As reported in several studies (Bloomberg, 2018; OECD, 2015b; PwC, 2011), the findings show that innovation performance indicators are correlated mostly with the economic indicators of cities that have achieved a breakthrough in innovation and industrial competitiveness positions (Scheel Mayenberger & Pineda, 2017).

While technological innovation for some industrialized countries generates large knowledge-based economies in certain sectors (Rosenberg, 2004; Wong, Ho, & Autio, 2005), their productivity indexes measured in terms of “total factor productivity” (TFP) do not show significant improvements (The Economist, 2016).

The paradox of growth is evident in the United States of America (USA). While intellectual property has increased from 150,000 patents in 2000 to more than 300,000 in 2015, the productivity rate has decreased from 1% to 0.5% during the same period. If patenting is one of the strongest sources of innovation, as it is in the USA, there is a reverse correlation between these two drivers of economic growth (Bureau of Labor Statistics, 2016; United States Patent and Trademark Office, 2016). We do not imply that productivity depends uniquely on patenting, we invite to analyze the implications of a policy focused only on productive innovation.

The development of some regions has also created wealth concentration, increasing the gap between the richest and the poorest, decreasing the quality of life for all (i.e. Silicon Valley, (Munroe & Westwind, 2008)), intolerance of ethnic and religious groups, possible contributions to global warming, poor schooling performance, as well as large migrations, poor governance, and ineffective rule of law, among the higher disparities of behaviors of regional ecosystems (Florida, 2006; OECD, 2015b).

A similar impact is reflected in a poor environmental quality. The impact of economic development has been correlated with the decline in the quality of water, clean air, fertile soil, and in general on the environmental resources (Yan, Du, & Jiang, 2010). In consequence, the economic growth created by technological innovation strategies, aligned with the widening social gap and the poor recovery of environmental damage of certain regions, creates some doubts on the sustainability frameworks of development of most countries (Barro & Sala-i-Martin, 2004). Besides, there is little information about how these indicators behave in different regions inside a country.

For these reasons, the following questions seem pertinent: Is innovation related to sustainable development? What could be the indicators to analyze the correlation between innovation and sustainable development? and which evidence do we have at a city level about the effects of innovation in sustainable indicators?