There is a school of thought among economists that holds that the primary problem in the world economy is a lack of productive investment, not a lack of capital.
We see this in things like companies buying one another rather than investing their capital in things that will create entirely new categories of products.
We see investment in cheap things, like new hardware and software but a lack of investment in expensive things, like infrastructure or major new manufacturing capacity. We see primarily derivative products. What really separates the current version of any phone from the last?
As a micro example, consider that in the fifteen years ending in the early seventies, Boeing designed and built four entirely new aircraft programs, the 707/720, the 727, the 737 and the 747.
In the fifteen years after that, there was only the 757/767.
In the fifteen years after that, there were only the 777 and the 787 with derivatives of the 747 and 737 soldiering on.
What happened to a company that was once willing to make one bet-the-company investment after another to make it so cautious?
This is only a microcosm of what's happening everywhere in the world economy.
That's what's wrong. It isn't a lack of available funds or skilled workers.
Incentives?
Create incentives for companies to take real risks on real programs and delete incentives for unproductive uses of capital.
Rearranging the deck chairs is not productive investment and should not be treated in policy as though it were.
Create incentives for real engineering and eliminate those for financial engineering and most of the current worldwide malaise could be remedied.