A profile of Kevin Murphy, called by some the smartest economist in America, mentions Murphy’s research on outsized gains from medical research. What happens when Murphy starts to think a little harder about innovation?

Although they are still “working some” on the economics of health and medicine, Murphy and Topel also have started to “think a little bit harder,” as Murphy puts it, about the process of innovation in health care and the economics of how to speed it up. They’re not taking “a purely mechanical point of view,” he says, but thinking about a world in which “one player intervenes and everybody else optimizes.” For example, a government or philanthropic organization that supports research might establish rules for sharing new knowledge, which may speed the development process. “So that’s the concept. We’re starting to get there.”

(Emphasis added.) Read the profile in the University of Chicago Magazine.

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