  A general theory of innovation and progress in human society is outlined,
based on the combat between two opposite forces (conservatism/inertia and
speculative herding "bubble" behavior). We contend that human affairs are
characterized by ubiquitous ``bubbles'', which involve huge risks which would
not otherwise be taken using standard cost/benefit analysis. Bubbles result
from self-reinforcing positive feedbacks. This leads to explore uncharted
territories and niches whose rare successes lead to extraordinary discoveries
and provide the base for the observed accelerating development of technology
and of the economy. But the returns are very heterogeneous, very risky and may
not occur. In other words, bubbles, which are characteristic definitions of
human activity, allow huge risks to get huge returns over large scales. We
outline some underlying mathematical structure and a few results involving
positive feedbacks, emergence, heavy-tailed power laws, outliers/kings/black
swans, the problem of predictability and the illusion of control, as well as
some policy implications.
