Professor Otto Toivanen, what do you research and why?
I’m interested in the impact of technological development on economic activity. The increase of our well-being depends on our ability to come up with new things or to learn how to do old things in a smarter way.
There are three main strands to my research: innovation policy, inventors and the impact of invention on the individual level, and the different forms of competition – particularly cartels. These three also all intertwined. With the right policy, the state can, for example, ensure that innovating firms end up competing against each other with their new products. In this way, the benefits go to the consumers rather than being kept by cartels, for example.
There is an especially strong link between invention and education. In one study, we worked out the probability of becoming an inventor. The initial results showed that the children of high-income fathers were clearly more likely to become inventors than the children of low-income fathers, and this gap was significantly larger for children of very high-income fathers. When we started to control for different factors – socio-economic status, intelligence quotient and education – the importance of income in effect disappeared and by far the most important factor turned out to be the education level of both the parents and the child. This is why it is so important that we do all we can to ensure that every child has every opportunity to study as long as possible.
How did you become a researcher?
At the start of the millennium, I was director of the Finnisch Graduate Programme in Economics. In the introductory lecture, I told the students that I had made 2 promises to myself. The first was that I would never do a PhD, but would instead go straight into proper work after my Master’s degree. The second was that I at least wouldn’t become a researcher after completing my PhD.
After completing my Masters, I felt strongly that I still didn’t know enough and that I wanted to become a true economist. And then when my PhD was coming to completion, I thought that it would be crazy not to continue now that I had all the tools ready. The underlying reason for going back on my promises was of course that this was incredibly fun, interesting and significant work.
What have been the highlights of your career?
Large grants and articles in top publications are of course important. But the best moments in this work are nevertheless when you get to think about new research problems or when you get to see the research data for the first time without any idea of what it might reveal. Solving problems and the moments of revelation that follow – these are wonderful things.
What is required from a researcher?
This work requires persistence and the ability to handle uncertainty. When you start some new research, you never know what is beginning and what it could bring, and publication processes can also be nerve-racking. There is also the vocational uncertainty, which is especially there at the beginning of one’s career, when there may be no guarantee of continuing funding and work even a couple of years into the future.
What do you expect from the future?
That I can continue working on the same topics – there are interesting further questions related to each of them, and so plenty more that needs explaining. I have previously allowed myself to be carried along by curiosity and the opportunities that have arisen. When I went to work in Belgium in 2010, I had a large pile of unfinished projects. I said to myself that I would not begin anything new until at least two thirds of the pile had gone. I kept my promise, and now I am daring to gradually take a look at new things again.
Otto Toivanen and Aalto University’s other newly tenured professors will speak about their research at an event to be held 31 January in Dipoli, Espoo. You are very welcome to come and listen to them and ask more about their research!
The event begins at 14.15. Check the program and details here.
Photo: Lasse Lecklin