Recent research revealed that exposure to innovation (e.g., mentorship program and immersive K-12 STEM education experience) during childhood and young adulthood has a greater effect on the decision to pursue careers in innovation than financial incentives. Researchers Alexander M. Bell, Raj Chetty, and their co-authors developed a model to analyze the impact of several factors on inventor career choices. After conducting an analysis using the model, the authors predict that financial incentives, such as top income tax reductions, have limited potential to increase aggregate innovation because they only affect individuals who are exposed to innovation and have no impact on the decisions of star inventors, who matter the most for aggregate innovation.
