Wednesday, January 30, 2013


Whenever economic experts discuss the financial situation of any country they always refer to innovation as one of the main sources of future income.  Innovation clearly depends on technical know-how, that requires a country to be technologically advanced and have a thriving university-level educational system.  Further, government control of industry and jobs reduces the opportunities for individual-based innovation.  For surely it is the individual who has a bright idea or who advances a specific technology that is the basis of innovation and of entrepreneurship.
Steve Jobs developed the first Apple computer in his garage, Bill Gates developed the first computer operating system (Microsoft Windows) in his small office.  And as you go back in time you find many such innovators, such as Edison, Tesla, Marconi, Baird, Ford, etc. each of whom had a bright idea and the motivation to pursue it.  Many innovations rest upon basic findings in science, such as Einstein's relativity theory resulted in basic changes in the way physicists looked at the world and hence resulted in such new areas as space travel and electronics. 
I can only describe in detail the area that I know well, namely the discovery of the structure of DNA.  Watson and Crick's short paper in Nature in 1953 describing the double-stranded helical structure of DNA was revolutionary, but is was based on solid evidence gathered for over a century in such areas as chemistry, physiology, biochemistry and genetics (for a detailed description see Portugal and Cohen "A Century of DNA", 1977 MIT Press).  The important point is that there is a continuous line of study and investigation that leads to such revolutionary scientific breakthroughs, known as paradigm shifts (see, Thomas Kuhn "The structure of scientific revolutions"). There is also no evidence that deliberately planning to make such discoveries can succeed, they result from unplanned individual insights based on breaking with contemporary thinking.  The only places where such innovation and breakthroughs can occur are in the West where there is the history and technology that enables individuals to freely strive for novel insights.
In a communist planned and controlled economy there is no opportunity for such innovation, nor for personal remuneration for such effort.  Thus, communism in the USSR collapsed and China has had to reinvent capitalism in order to survive.  Innovation is the fuel for the engine of capitalism, and it is alive and well in Israel.  Many years ago I wrote an essay on the contributions that Jews had made to the development of western civilization, without such innovative thinkers as Marx, Einstein, Freud and the hundreds of Jews who have won Nobel Prizes, particularly in Physics, western civilization would not be what it is today.  And without the Israeli contribution, the smart phones and tablet computers that we use today would be inconceivable.


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