Lou's summary was excellent. IBM Labs and Bell Labs (both sheltered by monopolistic power) did path breaking work, but sat on anything that did not promise a profit without disturbing existing lines of business, such as recording tape or answering machines. Tim Wu's book, The Master Switch, does a great job of analyzing the Bell system
Also Ravi (formerly of pen-l) tells a wonderful story of his early experience at Bell Labs. Maybe he will pop back in and tell his story. -----Original Message----- From: [email protected] [mailto:[email protected]] On Behalf Of Louis Proyect Sent: Sunday, February 26, 2012 10:00 AM To: Progressive Economics Subject: Re: [Pen-l] Bell Labs On 2/26/12 12:51 PM, Jim Devine wrote: > There's an interesting story in today's NY TIMES about the success of > Bell Labs. [ > http://www.nytimes.com/2012/02/26/opinion/sunday/innovation-and-the-be > ll-labs-miracle.html ] It would be interesting to compare Bell Labs to > Lucent Technologies and Alcatel-Lucent, which seem to be a failure > compared to BL. I'm no expert, but Lucent's history suggests that > competitive capitalism can slow or even prevent serious invention > (while AT&T's monopoly capitalism stifled the implementation of > inventions). Another thing the article should have examined is the > role of intellectual property rights. While Bell Labs was all about > sharing information, the new regime is about keeping knowledge secret. > Kotz argues that the Soviet economy was closing the gap with the west through the 70s until it went into a slump around 1975. That year the Soviet economy was rated at 50% of the west's from the standpoint of productivity. This slump was possible to overcome within the parameters of socialism, but the ruling bodies had already begun considering dumping the system for capitalism. The most interesting points were made around the question of innovation. Kotz makes a convincing case that competition such as the kind that exists in the Adam Smith model is HOSTILE to technical innovation. Capitalist firms would under-invest normally because their competitors can easily mimic the new improvements without undergoing the same expenditures. In reality, monopolistic firms are generally the ones that promote R&D, especially those that receive tax subsidies or have ties to the military. Bell Labs was a major innovator for many decades, but as soon as the phone companies were broken up, Bell Labs switched to market research from pure science or engineering. The implication for socialists is clear. Socialism, rather than capitalism, is potentially a source of rapid modernization and progress rather than capitalism. Kotz mentioned that the most extensive development of these ideas is contained in Pat Devine's articles and books. full: http://www.columbia.edu/~lnp3/mydocs/economics/markets.htm _______________________________________________ pen-l mailing list [email protected] https://lists.csuchico.edu/mailman/listinfo/pen-l _______________________________________________ pen-l mailing list [email protected] https://lists.csuchico.edu/mailman/listinfo/pen-l
