Leading thinkers, from President Barack Obama to Thomas Friedman, argue that innovation is key to improving the United States economy, now and in the future. If that is the case, how do we prepare young people to become innovators? That is the question Tony Wagner, Harvard University’s first innovation education fellow at the Technology & Entrepreneurship Center, asks in his new book, Creating Innovators: The Making of Young People Who Will Change the World.

To find the answers, Wagner profiles several young innovators, drawing on interviews with them and their parents, educators and mentors to discover the forces that have driven them to succeed in thinking outside the box. Innovative in format as well as idea, Creating Innovators features 60 embedded videos by filmmaker Robert A. Compton that bring the innovators and others to life.

Among the young innovators profiled: Kirk Phelps, a high school and college dropout who is working for SunRun, a start-up that is transforming the way electric power is generated and sold in the United States; Jodie Wu, a 24-year-old who started Tanzania-based Global Cycle Solutions, a social enterprise that creates affordable technologies to improve village life; and Jamien Sills, a shoe designer who is developing the concept for an eco-friendly shoe company while supporting himself with freelance design jobs and living at home.

Knowledge at Wharton spoke with Wagner about the Innovation Generation, what young people can do to hone their innovation skills, and the implications of his book for educators and businesses, among other topics.

Following is an edited transcript of the conversation.

Knowledge at Wharton: In your 2008 book, The Global Achievement Gap, you identified seven survival skills children need to succeed. In your new book, you add to those skills. You write: “Only one set of skills can ensure this generation’s economic future: the capacity for innovation.” What has changed since that book came out, and why do you think innovation is now so critical to America’s future?

Tony Wagner: What changed is the global meltdown in 2008. My book came out then, and I got tremendous validation about the seven survival skills and how important they were. But then I saw college students coming home with a BA degree, seemingly having mastered some of those skills, but in fact, not having a job. Right now, 53% of all college students under the age of 25 are either un- or underemployed. A third of them are living at home. I began asking myself if these skills were enough, and the more I studied the problem, the more I realized the economic collapse in this country is driven by the fact that we have a consumer-driven economy. I concluded that that economy is, in turn, driven by debt. We have created an economy based on people spending money they do not have to buy things they may not need, threatening the planet in the process. As I really studied and tried to understand what the alternative is, and what’s going to be the engine of the American economy going forward if this consumer-driven economy is not sustainable, I came to understand the importance of innovation and then became interested in the question of how, in fact, do you grow an innovator? What must we do differently as parents, teachers, mentors and employers?

Knowledge at Wharton: You profile several young innovators in the book, and you also look at their networks of influence, including their parents, educators and mentors. Whom did you talk to and what surprised you the most?

Wagner: I talked to a very wide range of young innovators in their 20s — some innovators in the so-called STEM field (science, technology, engineering and math), some who were artists and musicians and some who were social entrepreneurs. It was a demographically [diverse] and representative sample of young innovators out there. Then, as you point out, I talked to all of their parents, and then I asked each one of them — could they name a teacher or a mentor who had made the greatest difference in their lives in their development of their capacities to innovate? About a third of them could not name any teachers. They all could name at least some adult in their lives — two-thirds could name a teacher, the other third named mentors. I interviewed each one of those teachers and mentors, trying to see if I could find the patterns of parenting and teaching that contribute the most to the development of a young innovator.

What I discovered is that in every single case, the teachers who had the most critical difference in the lives of these young innovators was an outlier in his or her education setting. Elementary school through graduate school, every single one of them was an outlier. What made them outliers were the ways in which they taught, and the ways in which they taught were very consistent with what I saw to be some of the practices in the leading educational institutions that produce innovators. I’m talking about Stanford’s d.school, the MIT Media Lab and above all, the Franklin W. Olin College of Engineering, which I also profile in the book.

I came to see that the culture of schooling in America is radically at odds with a learning culture that produces young innovators in five essential respects. Number one: The culture of schooling is all about individual achievement, ranking kids, whereas, the culture of innovation demands collaboration. Every one of these teachers and classes I observed really build teamwork into all of their assignments. Number two: A culture of schooling is all about specialization. While that certainly has a role in innovation, what’s very clear in the world of innovation is a problem-based, multidisciplinary approach to learning. Number three: The culture of schooling is risk averse and penalizes failure. The culture of innovation is all about taking risks and learning from mistakes, trial and error. Number four: The culture of schooling is a very passive experience, where people essentially sit all day consuming information and then regurgitating it. The culture of learning for young innovators is all about creating — not consuming — real products for real audiences. And lastly, number five: The culture of schooling really relies on extrinsic incentives to motivate learning — carrots and sticks, As and Fs. But I discovered that these young innovators were far more intrinsically motivated, and when I looked at the pattern of what parents and teachers had both done to encourage intrinsic motivation, I found a kind of remarkable emphasis in the classrooms and among the parents of play, passion and purpose.

Knowledge at Wharton: Can you tell us more about those three forces?

Wagner: The parents of these young innovators encouraged more exploratory play, less programmed time for the kids, more discovery-based play, fewer toys, limited screen time, toys without batteries. They really valued their young people, their children finding and discovering a passion. Whatever it was they were interested in, these parents supported them. Because they understand that it is the pursuit of a passion that really develops the kind of persistence and confidence that you need to succeed as adults. Same with the teachers — they built time into every class for young people to pursue an idea or to pursue projects of particular interest to them in the context of the subject. What I found is that among these young innovators, as they pursued their passions, they morphed, they changed, they evolved — but in every case, they matured into a deeper sense of purpose because parents and teachers alike had talked about giving back or making a difference. These young people had these values very deeply in what they chose to be doing. The sense of purpose as adults became adult play as well as an expression of their passion.

Knowledge at Wharton: In your book, you note that millennials, who you refer to as the “Innovation Generation,” “want to make a difference more than they want to make money.” Laura White, one of the young innovators you profiled, said she is “not afraid of poverty…. I believe I can make it work if it’s doing the right thing.” In filmmaker Robert A. Compton’s afterword, he says that the biggest hurdle for this generation of innovators is “making passion pay the bills.” Do you think that’s true? And if so, what do you think are some solutions for that challenge?

Wagner: I don’t know what the solutions are. I think this generation certainly believes that they can live on less. Kids say, “I don’t need to own a car. I like to bike, so I’ll get a Zipcar when I need a car.” They say, “Well, I don’t know that I want to buy a house. It ties me down. I see myself moving around a lot.” Those are easy things to say when you’re in your 20s. When you’re in your 30s, when you’re thinking about a family, that picture may change. Having said that, though, I don’t see this generation becoming suddenly more materialistic. They have been exposed to too much in the sense that they have a broader understanding of the world and the challenges that we face as a planet and as a species, and I don’t think that they are going to easily turn their backs on those. What they may end up doing is some compromising in terms of whom they are willing to work for. None of these young innovators really see themselves working for large corporations. Or if they do, it won’t be for very long. That may possibly change, but I don’t know for sure.

Knowledge at Wharton: You note that many adults interpret a young person’s belief in social justice as naiveté. What message do you have for young people who are not surrounded by a supportive network?

Wagner: You need one. Seriously, that’s one of the things I discovered: the important role of nonprofits like Ashoka and a host of others that are springing up that support social innovators and entrepreneurs. That’s a vital network for a young person who has those interests. It made a critical difference among the young social innovators and entrepreneurs whom I interviewed.

Knowledge at Wharton: In other words, they should seek out those opportunities?

Wagner: Yes, and I think they’re doing it. This is a far more connected generation, and they know how to find support for what they want and need. They are doing it very successfully.

Knowledge at Wharton: How can parents, mentors and others help young people to develop creativity and the skills of innovation as they age?

Wagner: Well, the first, as I said, is to encourage more exploratory play. So many parents are programming their kids’ days and weeks, are worrying about their kids resumes in kindergarten or even earlier. What they need to understand, first and foremost, is that passion derives from more exploratory play. I don’t know whether you picked this up in the book, but I uncovered research to the effect that many of the most successful entrepreneurs and innovators today were, in fact, products of Montessori schools, where it is much more of a play-based form of learning.

I think the second thing that parents need to understand is they cannot and they should not try to protect their children. Too many parents are helicopter parents who are trying to hover. They are trying to tell their children how wonderful they are, which I think is a huge mistake. You really have to allow kids to experiment and to make mistakes because that is how they are going to gain self-confidence. They don’t gain real self-confidence from having been protected and living in a cocoon all their childhood.

Knowledge at Wharton: One of the things that is very interesting about the book, in addition to the ideas you express, is you also use an innovative format for the print and e-book versions that blends 15th- and 21st-century technologies, or as Compton says, technologies “from Gutenberg to Zuckerberg.” It includes embedded QR codes that link to more than 60 original videos. What made you decide to take that unconventional route, and what do you think readers gain by having access to the videos?

Wagner: Well, I think Bob Compton deserves huge credit for this. We were sitting at a restaurant in Singapore, where we had both gone to make another film. We made a film together called The Finland Phenomenon: Inside the World’s Most Surprising School System, which is a 60-minute documentary about the highest performing education system in the world. We had that kind of partnership and prior work experience. What he said to me was, “Tony, you can’t just write a book about innovation. It has to be innovative.” He proposed this idea of QR codes and offered to make the videos. I believe very strongly that videos add a huge dimension to understanding what 21st-century learning can and should look like. We have videos from High Tech High, a remarkable school of business that does an outstanding job of teaching the dispositions of innovation and the skills needed, including my seven survival skills from The Global Achievement Gap. We have classroom footage from the Olin College of Engineering. Then you also have the opportunity to meet these young innovators and many of their parents, as well as some of their teachers. You have a much more visual and personal experience with the book, in addition to a solid print experience.

Knowledge at Wharton: What advice do you have for young people who want to hone their innovation skills?

Wagner: First and foremost, they must follow their dreams. The most gratifying responses I’ve had to the book are in reaction to the letter to a young innovator that I write at the very end. It really comes from the heart and from my own experience of having tried to be an innovator in my own field. I’ve had a number of e-mails from young innovators saying how important it was and how affirming it was to have that kind of help and advice about pursuing their passion. There are other things that I say as advice to young innovators in that little three-page letter, but probably one of the more important things is to not think that you can do this alone and to try to find mentors and colleagues to work with. And to stay true to what your passion really is and your sense of a larger purpose in life.