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Summary
How do you jump-start an economy? You can invest in new technology, worker training, or R&D. Now, a team of economists has identified a new engine for growth: espionage. In the first study of its kind, researchers have analyzed more than 150,000 previously classified documents from the former East German Ministry for State Security (also known as the Stasi) that reveal thousands of industrial secrets stolen from the West—including plans for the Leopard I tank and the IBM 360 computer. Together, these thefts saved East German industry billions and boosted economic productivity: By one measure, industrial espionage closed the productivity gap between East and West Germany by some 8.6%. But the efforts also cannibalized investment in traditional R&D, with one researcher calling the undercover work, "R&D on cocaine."
