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Bring the domestic use of technology up

  • Published at 04:45 pm June 10th, 2017
  • Last updated at 05:09 pm June 10th, 2017
Bring the domestic use of technology up
A harsh truth is that economics still doesn’t know much about the world. The most common answer to any question within the subject is “it depends.” The same circumstances with different people, even at times the same people divorced in time, can lead to entirely different outcomes. We do think we’ve got a few of the basics right, printing too much money will lead to inflation (but that just moves the “it depends” to “how much is too much”?), trying to plan everything doesn’t work but some things must be planned, that it depends again. As an example for our lack of knowledge, there is a new paper relevant to Bangladesh. We’re still arguing over what it was that caused the Industrial Revolution those 260 years ago in Britain. Which has obvious consequences for places like your fair country today, where we’re all eager for the nascent industrial revolution to continue and grow. We know that the industrial revolution did happen in Britain, also that it spread to other countries over time and continues to spread today. But exactly what happened and how isn’t quite known as yet which causes obvious problems when we think about how we’d like to replicate it. The paper itself is “Human capital, knowledge, and economic development” which isn’t, if we’re honest, the most stirring of names. Yet within the argument presented, we find something hugely important. It wasn’t science, it wasn’t universities, and it wasn’t academic research which made it all happen. Rather, it was learning by doing. One of my favourite pieces of trivia from the time is that Adam Smith himself, when a professor at Glasgow University, hired James Watt to come and fix the department’s steam engine. Watt had not invented his own advanced design at this time and had no formal training in the subject at hand. And yet, being simply a handy man who had practical experience he was able both to do this repair and also develop his advanced steam engine later. There is a deeper argument about pure research too. Which is that it tends not to be the research which then drives technologies. Instead, not always but often enough, it is the finding that something works which then leads to the research trying to find out why it does, to uncover the deeper truth which allows this, or that machine to be built. Our steam engines are a good example. Boyle’s Law of 1662 explains why they work but the ancient Greeks had working examples and at least one patent for a working engine from 1606. The later research is what enabled truly effective engines such as Newcomen’s and Watt’s, but the observation that one was possible came before the theory. Another related point is that economic development comes not from the finding of new physical laws nor of exotic research, but the ability to apply what is already known to local needs and resources. Home spun cotton is still a feature of parts of South Asia while the mechanisation of thread and weaving has been known for centuries now. It is not more research in how to mechanise which is needed, but the application of what is already known. Which is where this paper has news for Bangladesh today. That original Industrial Revolution came not out of the dreams of the ivory towers of academe. But from practical men looking at the problems they faced and using the resources available to try and solve them. And so, it is when we desire to create the revolution again in another place at a later date. For example, we do not need Bangladesh, or any part of it, to research into mobile telephones. Sure, if someone has a good idea then why not, a better system would benefit everyone worldwide. But what we need locally is the application of that technology, not the invention of a better method of it. The same is true of just about everything else. No startling new design of refrigerator is needed, just the competent manufacture and distribution of them. We do not need to invent again the solar panel, just install them widely. Another way of putting this is that Bangladesh doesn’t need to expand the technological envelope in which development of the economy can take place. Rather, it needs to expand inside that global limit that already exists, bring the domestic use of technology up to what is already proven possible. Which is the true underlying message of this research paper and historical finding. The way that was done the first time, and the way it has been replicated elsewhere, was not by the clever people researching things and then defining what should be done. Rather it was done by practical people trying to solve specific and local problems. And so, it will be again in Bengal. Development will come not from anything new, but from the application of what is already known to local circumstances. Which means that our economic and development policy isn’t to try to push forward the boundaries of human knowledge but rather to just give those practical people the room to apply what is already known to our problems. Tim Worstall is a Senior Fellow at the Adam Smith Institute in London.
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