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Black Economist's Research Finds A Blindspot On A Theory Of Innovation


Patent filings by black investors in America declined noticeably following the Tulsa massacre of 1921. That is just one fact out of some fascinating research on black wealth creation that our Planet Money podcast has been looking into. Here's Mary Childs.

MARY CHILDS, BYLINE: One of the big ways economies can grow is innovation, new ideas, technologies. But when Lisa Cook was a Ph.D. candidate learning about this theory, she thought something was missing. Her professors seemed to think that the main thing you needed to spur innovation was strong patent laws on the books.

LISA COOK: No (laughter), it won't work that way, no. It seemed naive.

CHILDS: So she set out to prove that you need more than laws. She studied black inventors from 1870 to 1940.

COOK: You can have laws on the books and not enforce them and never have growth.

CHILDS: She knew that there were laws on the books protecting black inventions, but they weren't enforced like they were for white inventors. Also she knew there were other things that, she hypothesized, might stifle innovation, like segregation, racial violence and, the most extreme form, lynchings. So she started to find all the patent filings she could and then figure out the race for each of the filer for all of them, all 2 million filings.

COOK: It took me a year to identify the names and then a year to match them to the data and then another year to fail at that (laughter).

CHILDS: Eventually, she has her data. And it lines up as this chart that shows African American innovation over time. At first, the line went up. The 14th Amendment had passed, promising equal protection under the law. And African Americans made a lot of gains, holding office, owning property and filing patents at about the same pace as white inventors until 1900 following Plessy v. Ferguson, the Supreme Court ruling that legalized a so-called separate but equal America. States passed laws that pushed black Americans into not at all equal homes and schools or cut off access altogether. The line charting black innovation dropped sharply.

And then a few years later, it got a little weird. Cook sees something she can't explain. Her data were screaming at her that something happened in 1921. And she realizes that year was one of the worst incidents of racial violence in American history, the Tulsa Race Massacre. This one neighborhood in Tulsa had become famous as a bustling, wealthy community of African Americans. But in late May of 1921, mobs of white men invaded and massacred residents. This haven of black affluence burned to the ground.

COOK: Tulsa demonstrated that no one would help them - no one. The local government failed. The state government failed. The U.S. government failed at every single level.

CHILDS: The message was clear - the government would not provide even the most basic protections to black Americans, not for their lives, not for their property, certainly not for their inventions.

COOK: If I'm a black inventor, why would I ever invent anything if I thought the intellectual property was never going to be defended? You don't feel safe anywhere, but also, my livelihood might be in jeopardy.

CHILDS: After that, patent filings by African Americans dropped off, not just in Tulsa but across the country.

COOK: If the black Wall Street that everybody knew about, if it weren't protected, why would I be protected?

CHILDS: Clearly, just having laws on the books is not enough. And the implications of her findings are huge. It's generations of lost wealth for black Americans and also for the entire country. The U.S. lost out on more than 1,100 inventions from black inventors, about equivalent to a Netherlands. So Cook shows her work to three Nobel-winning economists. They say this is big. Publish this. But when she tries, she finds some of the same obstacles that she was studying still present in her own field. The comments that she gets back from journal reviewers aren't about econometrics. They're basic confusion about what it's like to be Black. Like, they kept asking...

COOK: Why would you care about a lynching that happened in a different state? Why would you care? The kind of fear and terror the black people knew then and that they know now was not even fathomable.

CHILDS: She ended up writing a black history paper on top of her economics paper. Cook says getting published usually takes two to three years. Her paper took 10 before getting published in 2014. A few weeks ago, Lisa Cook got promoted to full professor at Michigan State. There are more than 9,000 full professors of economics in the country, about 20 of those are black. Mary Childs, NPR News. Transcript provided by NPR, Copyright NPR.