1. Innovation & Economic Growth What promotes innovation?

2. GDP What creates Long Term Economic Growth? INCENTIVES MATTER!!!

3. Supply-Side Economics Orthodox macro theory consists of demand-oriented theories – they failed to explain stagflation (late 1970s) Supply-side economists believe the problems were high rates of taxation & heavy regulation: –This had reduced the incentive to work, save and invest. –What was needed was not a demand stimulus –Incentives are needed to stimulate supply. What is De-regulation?

4. Supply-Side Policy Basic Belief: Government Incentives Matter Goal: use incentives to shift the aggregate supply curve right –Note: When PPF shifts right => AS shifts right The supply-side toolbox consists of: –Tax cuts to stimulate work, saving, and investment –Deregulation to reduce production cost/stimulate investment. –Expenditures on education training/research expands capacity to produce

5. Innovation & GDP Growth

6. Innovation http://www.youtube.com/watch?v=BRAh4YemS0k Bark People => please watch this video

7. Innovation: Creating Jobs? U.S. Economy

8. Innovation & USA Financial Capital is needed to start a new businesses –Without money => ideas can’t become reality –Venture Capital Firms lend money to startups Ideas for a new business easily raise money in USA –Google, Apple, Microsoft, Facebook, Bloomenergy etc…

9. Recent IPO’s

10. Public School System

11. Movies on Charter Schools

12. Innovation in Schools? Charter School

13. Practice Test