A Quest for Knowledge

TL;DR

This paper models how knowledge influences societal policies and research choices, revealing that pursuing highly novel questions can sometimes accelerate overall knowledge growth through dynamic externalities and research cycles.

Contribution

It introduces a dynamic model showing how the novelty of research questions affects discovery value and how moonshots can positively impact knowledge evolution.

Findings

Benefits of discoveries are nonmonotone in novelty

Moonshots can improve knowledge growth through research cycles

Knowledge expands step-by-step via endogenous processes

Abstract

Is more novel research always desirable? We develop a model in which knowledge shapes society's policies and guides the search for discoveries. Researchers select a question and how intensely to study it. The novelty of a question determines both the value and difficulty of discovering its answer. We show that the benefits of discoveries are nonmonotone in novelty. Knowledge expands endogenously step-by-step over time. Through a dynamic externality, moonshots -- research on questions more novel than what is myopically optimal -- can improve the evolution of knowledge. Moonshots induce research cycles in which subsequent researchers connect the moonshot to previous knowledge.