Crisis as the Mother of Innovation

There is a very interesting nugget in a paper by Benjamin Hippen about the market for human organs in Iran, which I blogged about not long ago.

Hippen writes that in the earlier days of kidney transplantation, both the U.S. and Iranian governments “paid for dialysis while continuing to develop transplant options.” As more and more patients needed dialysis, the U.S. made it a fully funded Medicare benefit. But Iran didn’t feel it could do the same. Why not?

[T]he expense of dialysis, the economic collapse in Iran following the 1979 revolution, and the expense of the subsequent protracted conflict with Iraq encouraged the Iranian government to pay for transplantation as soon as immunosuppressant drugs made it a viable alternative to dialysis.

So that’s how, and why, Iran began down the road to allowing people to freely buy and sell organs on a regulated market. Without the financial crises, Iran probably wouldn’t have felt pressure to pursue a plan that turned out to be, on some significant dimensions at least, very successful. (Hippen argues that Iran is the one country in the world with no waiting list for kidney recipients.)

This reminds me of another instance where crisis produced innovation: During the 1970’s oil embargo, Brazil was so worried about its energy future that it devoted itself to building a sugar ethanol industry, and it worked. Again, without the crisis, it is likely that Brazil would have continued down the same oil-dependent path as other nations.

What kind of crisis/crises is the U.S. now experiencing, and what will some of the unexpected solutions be? (I am thinking of energy of course, but surely you must be thinking of others as well.)