The Positive Sum Strategy Harnessing Technology for Economic Growth (1986) / Chapter Skim
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Technology Adoption: The Services Industries
Technology Adoption: The Services Industries
Pages 357-372
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From page 357... ...
have presented Tree excellent, thorough, and well-structured discussions of key aspects of industrial competitiveness and how the adoption of new technologies affects competitiveness. This chapter amplifies three themes that I believe are perhaps underemphasized in Hose chapters, namely, ( 1)
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From page 358... ...
In modern history Me four traditional sources of marginal grown have been dwarfed ~ total bv entrepreneurs creating entirely new sources of weals launching monads -a -- -- I ~ ~ ~ ~ ~ ~ . ~ _ ~ _ ~ _ ~ _ ~4 _ ~ ~ ~ ~ ~ ~ of new enterpnses, Snug people to co things and lo provide services not available in the past, and generating whole new industnes (often with enormous support infrastructures)
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From page 359... ...
Carothers created the modern fibers industry and Baekeland the modern plastics industry as their esoteric experiments unraveled the characteristics of very large molecules. Edison's emp~ncal applications of unviewable electron flows and resistances created the electrical equipment industry.
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From page 360... ...
INNOVATION Other than the exploitation of inexpensive and abundant raw materials, relative national wealth depends primarily on two factors: (1) continuous productivity improvement, predominantly achieved by technology diffusion, and (2)
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From page 361... ...
SOURCE: From Centennial Research & Development Company, Investing in Venture Capital by Pension Funds Denver Colo.: February 1985)
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From page 362... ...
SOURCE: From John W Kendrick, International comparisons of recent productivity ~ends, in Measuring Productivity: Trends atul Comparisons, from the First International Productivity Symposium, Tokyo, Japan, 1983 (New York: Unipub, 19841.
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From page 363... ...
If the probability of success is 1 out of 100 and there are 500 to 1,000 dedicated individual entrepreneurs working, on a problem, We likelihood that one will succeed is vastly increased. But the small scale and highly dispersed nature of small failures also tend to disguise the true cost of individual entrepreneurial losses to the society.
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From page 364... ...
But one of the most often repeated errors of industrial policy (in Europe, the Soviet Union, China, and other industrializing countries) has been to focus on larger enterprises—and government interventions to "rationalize" these units rather than the much less deterministic processes of stimulating individual entrepreneurs and entirely new enterpnses.
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From page 365... ...
When this was not possible, He Bureau of Labor Statistics (BLS) composite productivity measurements, which apply a composite of measurable output factors to approximate "output" in venous services sectors, became the preferred source.
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From page 366... ...
The first Wee sectors were significantly ahead of Me somewhat reduced productivity rate increases in manufacturing during Me 1970-1983 penod. Some international comTABLE ~ BLS Index of Relative Output per Employee J=dus~y Average Annual Improvement 1960 1983 197~1983 Telephone/communicadons 6.1% 6.8% Air transportation 5.8 4.5 Railroad (rev.
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From page 367... ...
In-house studies showed that technology lowered transaction costs significantly for individual banks that automated extensively (Table 3) , but, bankers frequently found, as so omen happens elsewhere, Mat faced win lower costs and greater convenience—customers changed their behavior patterns and increased Weir number of transactions, thus obscunng overall efficiency changes.
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From page 368... ...
TABLE 3 Impact of Technology on Banking Costs Transaction Costs Old New Saving Check handling versus electronic teller facility $0.20 $0.09 55% plus float — 0.09 100 Automated client payments 0.31 0.06 81 Automated teller costs 0.87 0.40 54
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From page 369... ...
Fiber optic techniques allow surgeons to quickly diagnose and remove gall stones, kidney stones, digestive impairments, tumors, and other types of unwanted growls—lowering costs and reducing hospital stays to hours versus days or weeks. Advanced diagnostic techniques can prevent or ameliorate many classes of serious debilitative diseases, including cancers.
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From page 370... ...
C) > ~ O O ~ ~ CL z LLI o 0.9 0.8 0.7 0.5 0.3` ,_~ 0.2 1950 1955 1960 1965 1970 JAMES BRIAN QUINN Productivity LoanslSecondary _ 0~ ~ Productivity Deposits 1975 1980 1981 1982 FIGURE 7 Product in banking, 1960 to 1982.
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From page 371... ...
Will an 85 to 90 percent services economy in the United States develop an unacceptable dependency on the outside world for the raw materials and manufactures we consume? Or will a lively international trade develop for services as it did in the past for manufactured goods and matenals?
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