How do nations become wealthy? Many are blessed with abundant natural resources. Others conquer foreign lands. Some specialize in unique trade skills and crafts. Timber, mining, fishing, sugar, rum, narcotics, cotton, silk, agriculture, conquest, human slavery, manufacturing, oil, industry, banking, and so on — depending on the century and the region, nations have attained tremendous wealth in myriad ways. Notice that no nation has managed merely to print money and tax its citizens on the path to prosperity. Real wealth cannot simply be conjured from thin air. There must be recognized value in what a nation and its citizens possess.
More than any other source for national wealth, however, one towers above the rest: innovation. The ability of the human mind to create something new and valuable provides society with endless wealth creation. Unlike central bank quantitative easing and other monetary tools (or tricks?), the brain really is a money-printing machine. Whether an innov...