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  • Theme: Productivity and Economic Growth

    Posted by David Foster on December 1st, 2014 (All posts by )

    As Jonathan pointed out here, one problem with the blog format is that worthwhile posts tend to fade into the background over time, even when they might be of continuing value.  One approach I’d like to try is Theme roundups, in which I’ll select a number of previous posts on a common topic or set of related topics, and link them with brief introductory sentences or paragraphs.  At least initially, I’ll focus on my own posts.

    The posts in this second “theme” roundup focus on issues affecting productivity and economic growth.

    Energy, Productivity, and the Middle Class.  The primary driver of middle class affluence has been the availability of plentiful and low-cost energy…especially in the form of electricity…coupled with a whole array of productivity-increasing tools and methods, ranging from the horse-drawn harvester to the assembly line to the automated check sorting machine.

    Demographics and productivity growth.  Slowing population growth is of concern in just about every developed county because of the effects on worker/non-worker population mix.  Economist Michael Mandel presents a country-by-country analysis of the productivity growth rates required, in light of these demographics, to achieve a doubling of individual income by 2050.  (from 2005)

    The Innovator’s Solution.  My review of the now-classic book by Clayton Christensen and Michael Raynor.  Far more valuable than most books on business strategy.

    Closing time?  Citigroup (this is from 2010) listed  “ten themes that spell the end of Western dominance,” while Joel Kotkin challenged what he called “declinism.”

    Entrepreneurship in decline?   Michael Malone, who has been writing about technology and Silicon Valley for a couple of decades, worries (in 2009) that the basic mechanism by which new technologies are commercialized–the formation and growth of new enterprises–is badly broken. (Malone’s original article has disappeared, but I excerpted part of it.)

    Decline is not inevitable.  Many Americans have come to believe that our best years are behind us.  I assert that American decline is by no means inevitable…and if we do wind up in long-term decline, it will be driven not by any sort of automatic economic process, but rather by our own choices–especially our own political choices.

     The suppression of entrepreneurship.  Home Depot co-founder Ken Langone has some words for Obama.  (2010)

    The politics of economic destruction.  What Democratic Senator Christopher Dodd tried to do to angel and venture capital funding of new enterprises.

    The idea that bigness automatically wins in business still seems to have a remarkable number of adherents, despite all evidence to the contrary.

    Startups and jobs…some data.  (the original post was just a link)

    Bigotry against businessspeople.  Media and political hostility toward businesspeople, and its consequences.

    Leaving trillions on the table.  The transistor as a case study in central planning versus entrepreneurial diversity.

    Misvaluing manufacturing. The once-common assertion that “services” are inherently of higher value than manufacturing was not very well thought out.  (2003)

    “Protocols” and wealth creation.  With  help from Andrew Carnegie, I challenge some assertions in a David Brooks column.

    Musings on Tyler’s technological thoughts. Comments on Tyler Cowen’s book Average is Over.  While it’s worth reading and occasionally thought-provoking, I think much of what he has to say is wrong-headed.

     

    4 Responses to “Theme: Productivity and Economic Growth”

    1. Michael Hiteshew Says:

      The comments appear closed on the individual articles so I’ll comment here on Leaving trillions on the table.

      It might be apocryphal, but years ago I read an interesting vignette about the early years of integrated circuit design and production at Texas Instruments (TI). I don’t remember the details, but the outline was this. Sometime in the early 60’s someone involved in the Apollo project was touring TI on a sort of technology appraisal. He was shown some experimental logic circuits, some simple gates. There were four (I believe) inside a small ceramic package. At that time, gates were being built from discrete elements. The leading edge of technology was something called a cordwood module, a very impressive and clever bit of electronics packaging for its time. But not as impressive, or as light, as an IC. Critically, ICs drew less power as well. The Apollo project engineer asked if these could be put into production – now. He said he would take all they could produce. That was the kick-start to IC production at TI. It would have happened anyway, but it was an early boost which gave them an income stream for R&D and the opportunity to invest in machinery and learn how to produce ICs in quantity. Interestingly, cordwood modules continued to be produced right into the late 70’s as a sort of early form of custom IC design.

      Very interesting related video:
      The Apollo Saturn V Launch Vehicle Digital Computer (LVDC) Circuit Board

    2. Grurray Says:

      Dodd-Frank was a disaster. It’s purpose was to consolidate the financial industry so it could be more easily controlled by the Federal government and Federal Reserve. It ended up solidifying and codifying ‘To Big To Fail’, rewarding the institutions that caused the financial crisis, and punishing small investors. It was the ultimate in adding insult to injury in saying it was to fix to the problem when in fact it was the oposite.

    3. dearieme Says:

      Yeah, busineSSpeople, don’cha just hate ’em? Mind you, media and political hostility could be viewed as a badge of honour.

      I remember that my father – who ran his own business – entertained considerable contempt for corporate managers who styled themselves businessmen, largely because his experience persuaded him that many of them would have been quite incapable of forming or running a business of their own.

    4. Mike K Says:

      From the thread on salesmen:

      “That salesman would have had a sale if he had only followed up.”

      I took my daughter to a Toyota dealer to buy a new Toyota. We walked in and the salesman immediately began to show us an expensive model. I said no, we were interested in a Corolla, the cheaper model. He took us out to the back lot of the huge dealership and suggested we look at models. He never came back, Finally we walked through the showroom on the way out (The only way to leave that dealership). The salesman saw us and started to follow us. I said, “No thanks,” and we kept walking. As we got to my car, the sales manager came to my car window and tried to convince us to come back. I said no and we almost had trouble getting him to leave us alone.

      We drove to a Honda dealer and bought her car in half an hour. The salesman even bought her old car (A Toyota) for cash. The 20 rule.