How Genomics Changes Everything

Futurist: Juan Enriquez
Affiliation: Senior research fellow and director of the Harvard Business School Life Science Project, Enriquez will speak at Fast Company's signature event, RealTime, next month in San Diego. He is also working on a new book: Flags, Borders, Anthems, and Other Myths: The Impulse Toward Secession and the Americas.
Home Base: Cambridge, Massachusetts

Scenario

"Size really doesn't matter. In a knowledge economy, you don't need a lot of resources to generate a lot of wealth. You need quality, not quantity, of ideas."

According to Juan Enriquez, director of the Life Science Project at Harvard Business School, the preeminence of innovation over immensity explains why small countries like Israel, Singapore, and Luxembourg are pulling ahead of the United States in number of patents registered, amount of wealth created, and economic equality of citizens. As the world grows smaller and global trade increases, the size of a country's internal market matters far less than the number of its external trading partners, he says. And in the European Union, that number is growing every day.

In this global economy, Enriquez says, the countries that export the best ideas will win, regardless of size. According to him, one measure of a nation's intellectual capital is the number of patents generated per capita. Alongside tiny countries like Switzerland, Sweden, and the Netherlands, the United States tops the list with one patent generated for every 3,000 citizens. At the other end of the spectrum is Argentina with just one patent for every 880,000 citizens. That, Enriquez says, points to a larger and more troubling trend among Latin American and African nations.

"Most of the world doesn't generate a lot of new knowledge," he says. "There are very few patents coming out of Latin America that are globally productive. There are even fewer coming out of Africa. One consequence is that you are delisting companies in the stock markets. That's a fancy way of saying you have ever fewer companies in those stock markets. If you have fewer companies, you also have fewer jobs, and less wealth."

So What?

Argentina's patent shortage suggests that it missed the essential transition from an agriculture economy to a manufacturing economy and then to a knowledge-based one. Like many struggling nations, Argentina counts among its top exports old-economy items like meat, wheat, corn, oilseed, and manufacturing equipment.

"Argentina created an awful lot of wealth at the beginning of the last century," Enriquez says. "But the country remained mostly agricultural at a time when the price of commodities dropped to 20% of what it was 150 years prior. Argentina doesn't understand that we live in an economy based on ideas and that if they keep doing what they are doing, they will die."

Argentina's failure to enter the knowledge economy highlights an even bigger problem: The second-largest country in South America is not investing in its people. "Most failed states don't realize that the most important thing they have is people," Enriquez says. "That sounds silly, but they really don't get it. Typically, these states say, 'We have diamonds, or gold, or rubber, or oil.' And they focus on how to export oil, rather than on how to educate people."

Citizens in these failed states often do not receive adequate training in the sciences, Enriquez says. And that deficient education leaves countries like Argentina without any thought leaders who can march the country into the next economy, the next century, the next world of opportunity. It's crucial not for every citizen to be a Nobel Prize winner, but rather for every citizen to respect and understand how important scientists are to the future.

"It doesn't matter what Argentine interest rates are, who's running the finance ministry, or what their basic inflation rate looks like," Enriquez says. "Argentine people don't have the ability to generate the wealth to back up what they say their currency is worth. And that is a transaction that a bunch of countries are getting wrong."

What the Future Holds

In the future, says Enriquez, science education and exploration will be dominated by one theme: genomics. And most new patents and business ideas will revolve around the branch of science that studies, decodes, and modifies the human genome. Nations that understand the significance and speak the language of genomics will soar; nations that don't will fail. The same goes for companies.

"Genomics changes material science," Enriquez says. "It changes the biggest chemical companies in the world. It changes cosmetics companies. It changes food companies. It changes seed companies. It changes energy companies. If you are ignoring these trends, you're not understanding where the biggest databases ever generated by mankind are being created: in genomics."