A Not-So-Dismal Science: A Broader View of Economies and Societies

A Not-So-Dismal Science: A Broader View of Economies and Societies

A Not-So-Dismal Science: A Broader View of Economies and Societies

A Not-So-Dismal Science: A Broader View of Economies and Societies

Synopsis

This book shows that, in calling economics the 'dismal science', Thomas Carlyle was profoundly wrong. Economic ideas have illuminated behaviour in all of the social sciences in addition to the economists' traditional domain. The broadening of economics and the use of economists' methods by social scientists in other fields is leading to a unified and positive view of economies and societies.

Excerpt

Joel Mokyr

Are the crucial decisions that determine economic growth, even in economies committed to free-enterprise economics, made primarily in the marketplace? Markets determine the allocation of existing resources and are believed by most economists to be better at this than any alternative. But how about technological change? The bulk of the economics of new technology is concerned with the generation of new knowledge and the problems of appropriability and incentives in the creation of new technology. It rarely asks when and how decisions to adopt new technology are made by firms.

Much as economists might deplore the fact, the acceptance of innovation is more than an economic phenomenon, and certainly far more than a pure advance in productive knowledge. The concept of competition remains central here, but it is not so much the neoclassical concept of price competition of firms in the marketplace as much as Schumpeter's concept of competition between different techniques struggling to be adopted by existing firms or between different final products slugging it out over the consumer's preferences. At times individual techniques may be identified with a firm, but often techniques struggle for adoption within a single organization. How are these decisions made? Why is it that, even when a new and superior technology is made available at zero marginal costs, the economy to which it is proposed may choose to reject it?

Economic analysis implicitly assumes that new techniques will be adopted if

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