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No science, no startups: The innovation engine we're switching off

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Re: No science, no startups: The innovation engine we're switching off

#21

Post by cratermoon »

terminalshort wrote: post #3

> In the 20th century, U.S. companies put their excess profits into corporate research labs. Basic research in the U.S. was done in at Dupont, Bell Labs, IBM, AT&T, Xerox, Kodak, GE, et al. This changed in 1982, when the Securities and Exchange Commission ruled that it was legal for companies to buy their own stock (reducing the number of shares available to the public and inflating their stock price.) Very quickly B…

Note the "maximize shareholder value" aspect. That's the essential driving force behind business since then: The Friedman doctrine.

Now consider the choices a company makes when executives hold the Friedman doctrine as orthodoxy. Put money into basic research that might generate shareholder value in some unknown time, or buy their own stock back and pump up the price?

Re: No science, no startups: The innovation engine we're switching off

#22

Post by terminalshort »

7thaccount wrote: post #8
terminalshort wrote: post #3

> In the 20th century, U.S. companies put their excess profits into corporate research labs. Basic research in the U.S. was done in at Dupont, Bell Labs, IBM, AT&T, Xerox, Kodak, GE, et al. This changed in 1982, when the Securities and Exchange Commission ruled that it was legal for companies to buy their own stock (reducing the number of shares available to the public and inflating their stock price.) Very quickly B…

Nothing against research universities as good stuff does occur there, but it just seems like it was such a a huge loss seeing those corporate labs disappear. I think it helps to have scientists and engineers closer to the problem and who don't have to spend a huge amount of their time writing grants and training grad students.

And you can have a career track that normal people will actually want. The whole phd -> postdoc -> (maybe) tenured professor thing is such misery that I never even gave it a thought as a career.

Re: No science, no startups: The innovation engine we're switching off

#23

Post by terminalshort »

cratermoon wrote: post #21
terminalshort wrote: post #3

> In the 20th century, U.S. companies put their excess profits into corporate research labs. Basic research in the U.S. was done in at Dupont, Bell Labs, IBM, AT&T, Xerox, Kodak, GE, et al. This changed in 1982, when the Securities and Exchange Commission ruled that it was legal for companies to buy their own stock (reducing the number of shares available to the public and inflating their stock price.) Very quickly B…

Note the "maximize shareholder value" aspect. That's the essential driving force behind business since then: The Friedman doctrine. Now consider the choices a company makes when executives hold the Friedman doctrine as orthodoxy. Put money into basic research that might generate shareholder value in some unknown time, or buy their own stock back and pump up the price?

Why would companies not want to maximize their value before share buybacks?

Re: No science, no startups: The innovation engine we're switching off

#24

Post by terminalshort »

photochemsyn wrote: post #20
terminalshort wrote: post #3

> In the 20th century, U.S. companies put their excess profits into corporate research labs. Basic research in the U.S. was done in at Dupont, Bell Labs, IBM, AT&T, Xerox, Kodak, GE, et al. This changed in 1982, when the Securities and Exchange Commission ruled that it was legal for companies to buy their own stock (reducing the number of shares available to the public and inflating their stock price.) Very quickly B…

The article doesn't mention that Bayh-Dole made it legal for a university to exclusively license a patent generated by a government-financed researcher to a corporation. Prior to this, if a corporation wanted to have exclusive rights to basic patents, they'd have to run their own private research labs to generate those patents. Prior to Bayh-Dole, university inventions were patented but there were no exclusive licens…

This sounds like a much more reasonable explanation for the fall of the corporate labs.

Re: No science, no startups: The innovation engine we're switching off

#25

Post by zkmon »

>> Scientists are driven by curiosity

Ok, then why do they get affected by funding? The truth is, today there is not a scientist, artist, researcher or writer who is not driven by funding. The era for curiosity-driven science is was over a long time ago.

The direction of research or science is all driven by funding.

Re: No science, no startups: The innovation engine we're switching off

#28

Post by Larrikin »

aeonik wrote: post #4
rthrfrd wrote: post #2

Startup = disruption = threat to existing control. If you love control and have control, why would you want to create fertile ground for startups? (This was meant as devil's advocate, not my personal point of view).

That's short term thinking. You can't stop innovation across the planet, you will lose control over time as adversaries continue to innovate and subsume antiquated control structures.

All the people in charge currently are banking on being rich, enjoying society as they have made it, and then dead before it personally affects them.

Re: No science, no startups: The innovation engine we're switching off

#29

Post by dkyc »

terminalshort wrote: post #3

> In the 20th century, U.S. companies put their excess profits into corporate research labs. Basic research in the U.S. was done in at Dupont, Bell Labs, IBM, AT&T, Xerox, Kodak, GE, et al. This changed in 1982, when the Securities and Exchange Commission ruled that it was legal for companies to buy their own stock (reducing the number of shares available to the public and inflating their stock price.) Very quickly B…

It's not even clear that the premise is true. There's lots of 'research' done in the big tech companies.

The biggest reason why companies don't seek to emulate "Dupont, Bell Labs, IBM, AT&T, Xerox, Kodak, GE", is probably that it reads like a list of textbox examples of "companies that failed to execute on their research findings", so clearly there was something wrong with this approach.

Re: No science, no startups: The innovation engine we're switching off

#30

Post by UncleMeat »

terminalshort wrote: post #23
cratermoon wrote: post #21

Earlier quoted context omitted.

Note the "maximize shareholder value" aspect. That's the essential driving force behind business since then: The Friedman doctrine. Now consider the choices a company makes when executives hold the Friedman doctrine as orthodoxy. Put money into basic research that might generate shareholder value in some unknown time, or buy their own stock back and pump up the price?

Why would companies not want to maximize their value before share buybacks?

Loads of reasons. The shareholder theory of corporate governance is actually not very old.
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