The Revolutionary Socialist Network, Workers
Capitalism improves the quality of life for everyone – Industrial Revolution proves
Download 2.09 Mb.
|
Capitalism improves the quality of life for everyone – Industrial Revolution provesBaumol 4 [William J. Baumol, Professor Emeritus at Princeton University, The Free-Market Innovation Machine : Analyzing the Growth Miracle of Capitalism, The “Somewhat Optimal” Attributes of Capitalist Growth: Oligopolistic Competition and Routinization of Innovation, Princeton University Press, 40-41 , SMarx, JTong] Returning, finally, to the central point of this chapter, the crucial fact is that most of us do recognize the beneficial spillovers that innovation has contributed and we all seem to agree that this enhancement of living standards is very desirable. In other words, perhaps without realizing that we were discussing the spillovers of innovation, we have concluded that they are a very good thing. It follows immediately that, even if zero spillovers were possible and did increase innovation, they would certainly be far from optimal. Here, the standard reaction of many economists— that disinterested academicians cannot take a stand on income distribution on any basis of rigorous analysis, whatever their personal feeling— just will not do. Of course, no one aspires to a world in which innovators receive incomes in the trillions of dollars (putting Mr. Gates’ income into the shade), while the remainder of the community languishes in seventeenth-century poverty. But if this is so, then we must also go on to reject the conclusion that spillovers are incompatible with optimality in the growth process. Once that is recognized, the remainder is a matter of haggling about the degree of deviation from zero. My own value judgment on this issue is summed up by George Bernard Shaw’s dictum that there is no crime greater than poverty, which leads me to believe that the most desirable value of S is very much large than zero. For, surely, it is widely and appropriately accepted that the main benefit of the Industrial Revolution is the remarkable increase in average per capita incomes and, more particularly, in real wages. Of course, those innovations that have never been born do constitute a loss to society. But the point in the analysis here is that there is an in-escapable tradeoff between two desirable phenomena: further increases in innovative activity versus diversion of the benefits to bring society out of poverty, to spread education and health care, and to finance the better life not just for the fortunate few but for the population as a whole. Given such a tradeoff, we are back in the realm in which economists are most comfortable. In Lionel Robbins’ justly noted words, we are back at the allocation of scarce resources among competing (and desirable) ends. And the analysis of such tradeoffs is the meat and potatoes of our professional activity. Download 2.09 Mb. Share with your friends:
|