I find the replacement rate question really interesting. Is there an aligned way we can allow companies to decay once they have stalled in innovation? What do we do about companies that have reached a point of monopolistic advantage but provide no real new innovation (PG&E comes to mind)? In some cases like Internet access, is competition the only driver of affordability or do we eventually have to find a way to regulate pricing on things that evolve to become general public needs. This question likely comes up a lot in healthcare and pharma, but I'm not sure there's a good answer. It's sort of muddled in between providing enough incentive to creators to start things and ensuring that once things do get created, that privatized commercial interest doesn't work to remove the very value it helped create (which happens when the company stops innovating).
I believe regulation is often the cause rather than the solution to stalled innovation. If you look at areas where innovation has stalled, high barriers to entry for new companies is typically a primary cause and in many cases regulations contribute to that barrier.
We should make it a goal to lower those barriers and encourage competition wherever possible. NASA's commercial crew program is one example of this. Another is how Illinois forced their electric companies to open access to the power lines, fostering healthy competition.
