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06/07/25

Research, Economics, Walmart

Filed under: Economics, Politics, Science — Jared @ 1:58 pm

Ars Technica put up a very good article by Hannibal talking about old-school vs new-school R&D. It reminds me of a discussion I had with Matt a few weeks ago, and why I don’t trust the free market to figure out everything on its own. The problem with allowing economics to get entangled in science is that much of the science worth doing isn’t profitable in the near term, if ever. Hannibal describes the old research style (and this jives with my understanding of history):

The great labs of this era—Bell Labs, Xerox PARC, and IBM’s labs—were places with massive budgets, where the world’s top scientists were invited to pursue “blue sky” research into areas with no immediately apparent commercial applications. The facilities were state-of-the-art, and there was no pressure from management or shareholders to do anything but science for science’s sake. To be able to fund such a lab was a mark of corporate prestige, and the labs themselves, along with their public counterparts like NASA, were major sources of national pride. For a company like Xerox or AT&T, what it meant to have a blue sky research lab was very much like what it means for a city to host a winning sports team; it was a source of pride and an anchor of collective identity. So much like the science that they produced, these labs were ends in themselves.

Emphasis mine. He goes on to explain that the information revolution we currently enjoy has cashed in on much of this research, and that the fast paced economy of today makes “blue sky research” way more difficult to fund; shareholders want profit today, not a possible benefit to society twenty years from now.

Before I get comments or e-mails, let me explain something: I’m not against a pretty free market. Matt put up a post about Walmart that I agree with. I happen to dislike Walmart for a number of reasons (their treatment of employees is legendary at this point), but I wouldn’t suggest we dismantle them because they destroy little businesses. Business is rough, wear a helmet. On the same token, I wouldn’t suggest that we try to prevent the short-minded thinking that goes along with today’s economy. I don’t have any idea if our economy is sustainable (I leave that to the economists out there), but I know that it does drive things cheaper. And with the Internet and sites like Consumerist.com, it is getting easier every day to hold companies responsible to their customers.

That aside, I think there is huge value in science for science’s sake. I’m not unbiased; I am a scientist after all, and if I could make a decent living in academic science (which you pretty much can’t at the moment), I would be there. But I think it is worth doing all of that research just so that we can learn more about ourselves and the universe we live in. Forget all of the capitalization potential in such research; who really doesn’t want to understand the world we live in better? The problem with such research is that it’s expensive, and someone needs to foot the bill. Private money for such ventures is not in oversupply, so where to get the funds? The only place I can think of is public money, but if we can’t agree to fund Embryonic Stem Cell research (which could, some day, relieve countless people of varying suffering), I have doubt as to our ability to do that at this point. Hopefully an oversupply of private money will appear at some point, with the realization that the research done with those dollars will likely yield results in the decades after they are spent.

And if a few companies can take that research and actually cure cancer with it? All the better.

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3 Comments »

  1. The problem with allowing economics to get entangled in science is that much of the science worth doing isn’t profitable in the near term, if ever.

    That’s not true – plenty of companies have R&D departments doing things that they have no near-term plans to capitalize on. An example that comes to mind is Microsoft’s Singularity Project. Singularity is an entirely new research operating system, (sort of) built on top of .NET, with a focus on reliability and security rather than performance. It’s an incredible piece of work, and must have cost Microsoft a lot of money – and they have no plans to deploy it in any form. It’s even difficult to imagine a scenario where they would, because it not only obsoletes current programs, but changes the very concepts behind application development.

    And yet they continue to fund research in this area, just to push the envelope in terms of security and reliability.

    He goes on to explain that the information revolution we currently enjoy has cashed in on much of this research, and that the fast paced economy of today makes “blue sky research” way more difficult to fund; shareholders want profit today, not a possible benefit to society twenty years from now.

    Well, of course corporations can’t mindlessly blow money on ivory tower ideas that have the potential to benefit society two decades later. If it’s a true money sink, with no benefit for the company at all, or at least for the industry, then a for-profit corporation shouldn’t be doing it anyway – that’s what non-profit corporations are for! Needlessly wasting shareholder money is not proper behavior for a corporation, and they would be rightfully liable to shareholder lawsuits.

    That aside, I think there is huge value in science for science’s sake.

    So do I – I just don’t think that a for-profit corporation is the right managerial structure to support it.

    Comment by Matt Spong — 06/07/25 @ 4:35 pm

  2. Well, to be fair, my own slant is in the general direction of biological research; you’ve told me about the Singlarity Project before, and I’d forgotten it. Suppose we all get stuck in our own little professional worlds. And to be fair, I can think of one project in the bio world (the Harvard Stem Cell Research center, although I’m not sure if that is the group’s exact name), and although much of the money is private money, I don’t believe that it’s corporate, I’m pretty sure it’s personal money.

    I was specifically trying to show an understanding that for-profit companies; I suppose I’ll do more careful word choice next time ^_^

    I am to a degree wishing for the days of my grandparents, and long-term thinking. I understand those days are over, but that’s not the point. I just wonder if America will get the social will to start planning in longer cycles than 2-4 years.

    I dunno, I see the problems, but I have no practical solutions. Meh, guess I’ll just continue going to my job day to day ^_^

    Comment by Jared — 06/07/25 @ 8:40 pm

  3. Heh, the days of your grandparents weren’t as different as they’d have you believe (technological differences aside). The same short-term corporate thinking went on then, for the same reason (quarterly earnings reports and their effects on stock prices).

    I’m not sure the research environment is any different, either, nostalgic memories of AT&T Bell Labs notwithstanding. How many other corporations were around then that had research divisions like that? I’m guessing not many. And I’m sure there are companies here and there that have the same thing going on today. Actually, there are probably more of them today.

    Comment by Matt Spong — 06/07/25 @ 10:03 pm


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