EVEN THE most innovative businesses should understand their limitations, according to Joel Mokyr. Their strengths lie not so much in dreaming up new ideas but making use of them.

One of the world’s leading economic historians and a professor at Northwestern University in Chicago, Prof Mokyr argues that those companies that want to gain the most from new concepts should not necessarily seek to hire the most original thinkers, but instead tweak their management structures so they are as receptive as possible to outsiders with something new to say.

He backs up his theories with research stretching back 5,000 years. The so-called “knowledge society” – the modern-day term for a world dominated by flows of information – has in fact been with us for centuries, he says. What is important is how to devise the conditions for creating knowledge and then capitalising on it.

The 61-year-old academic has written several books about the links between history and change, including The Lever of Riches, his best-known work. He is also the editor-in-chief of the Oxford Encyclopaedia of Economic History. His views on how knowledge has led to wealth creation contain some important messages for business.

The process happens most efficiently in the US, despite its image as a fading superpower. It does not matter that the US’s mean scores in areas such as science and technology education are poor, he says. “What matters is we have Caltech and MIT ... It is the top 0.1 per cent of smart people, the whizzkids and brilliant geeks, who will move the world.”

Such people – even if they remain in universities all their lives – can be vital for businesses, if companies can find ways to tap their thinking. It is the theme of Prof Mokyr’s new book, The Enlightened Economy, which is centred on the 18th-century “Age of Enlightenment” in Europe.

The heroes of this era included the French philosopher Voltaire and the British scientist Joseph Priestley – people who were the 1700s equivalents of today’s “whizzkids and geeks”. “They were interested in trying to encourage people to behave better, and to lay the basis for material improvements in society, and to a large degree they succeeded,” he says.

Leaving aside the achievements of key people, he adds, the Enlightenment “provided us with the basic ideas that have conditioned us ever since: that the creation and dissemination of useful knowledge is the key to economic progress”. - (Financial Times service)