Quotation of the Day…

by Don Boudreaux on November 14, 2011

in Complexity & Emergence, Creative destruction, Growth, Innovation

… is from page 45 of Steve Landsburg’s delightful and insightful 1997 book, Fair Play:

I grab every occasion to impress upon her [Steve's and Lauren's daughter Cayley] that each of her material comforts is the product of an act of genuis, that cars and computers and supermarkets are all there only because somebody thought of them.

Yep.  As Julian Simon taught us, human beings are “the ultimate resource.”

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{ 70 comments }

El Diablo November 14, 2011 at 11:53 am

Good quote! It is also important to realize that people thought of them. Not companies, not countries, not government. People did.

Stone Glasgow November 14, 2011 at 2:29 pm

Yeah but they depended on public roads and firemen while they worked so we all own anything they make. Duh.

SmoledMan November 14, 2011 at 3:01 pm

Elizabeth Warren thanks you for that in-kind contribution.

vikingvista November 14, 2011 at 11:55 am

I thought all of those wonderful things came into existence just because someone demanded them. No?

El Diablo November 14, 2011 at 12:00 pm

No. But, I appreciate your sarcasm. Someone thought of it, believed that other people would enjoy the good or service so much that they would be willing to pay more that it cost to make or deliver, and then took a risk. Free markets and free people lead to innovation and new product creation, not silly ideas that everyone else thought of it, started demanding it, and finally someone yielded to aggregate demand and started supplying it.

vidyohs November 14, 2011 at 5:55 pm

I think that the track record of invention and improvement of things is more often than not stimulated by observation of a need to make some human action(s) more efficient.

For example:
Eli Whitney didn’t dream up the Cotton Gin with the understanding he would have to convince people to use it. Quite the contrary, the people wanted something more efficient than handpicking seeds from Cotton bolls. Eli Whitney invented the Gin and people jumped on it like a duck on a June bug. Same with the McCormick Reaper, the Sewing Machine, dirty dancing, somethings just sell themself.

Now, the Inside the Egg Egg Scrambler, not so much.

SheetWise November 16, 2011 at 2:24 am

“Now, the Inside the Egg Egg Scrambler, not so much.”

Even if scrambling is a problem — which I don’t think it is — I never understood how solving the problem within the shell was a solution.

Probably friends and family money never run by an analyst.

Stone Glasgow November 14, 2011 at 2:31 pm

Yes it’s like magic. If you demand it, it shall appear. Like a child screaming for ice cream in a high-chair. If at first you don’t succeed, scream louder!

Gil November 14, 2011 at 11:30 pm

WHERE ARE THE WONDERFULLY VIABLE NUCLEAR FUSION POWER STATIONS!!!!!!!

Damn. Didn’t work.

Ryan Vann November 14, 2011 at 3:05 pm

What’s that classic line from Field of Dreams? If they come, you will build it?

Slappy McFee November 14, 2011 at 3:12 pm

Choked on my sandwich — THANKS for that!!

John Muir November 14, 2011 at 3:22 pm

LOL!

vikingvista November 14, 2011 at 4:03 pm

Perfect.

Darren November 14, 2011 at 8:00 pm

I thought all of those wonderful things came into existence just because someone demanded them.

Someone thought of them. Someone made a few. Others demanded them. The first person made a few more. More people demanded them. More were made. More demanded. And on and on. It seems to me creation of a product does not create demand. Someone must first invent an item (and probably produce some), of course, but demand creates an incentive to *increase* production of that item. As demand increase, productoin increases. Perhaps the reverse is true and demand increases in response to an increase in supply. It looks to me like there are really two different (and conflated) issues: (1) invention of the item (product, process, service, etc.) and (2) increasing the supply of that product. Individual innovation is required for the first. Increased demand (mostly) creates the incentive to do the second.

Fred November 14, 2011 at 12:05 pm

I remember as a child in the supermarket my mother took a twist-tie and said to me (paraphrased) “Son, someone got rich off of the idea of sandwiching a piece of wire between two pieces of tape. Something that simple and useful made someone buckets of cash. All you have to do is come up with one good idea and you too can become rich.”

I’m still waiting for that good idea….

Jon Murphy November 14, 2011 at 12:15 pm

Bottled water.

Methinks1776 November 14, 2011 at 12:33 pm

You have to chase a good idea. They rarely just show up in your head out of nowhere. It’s really quite amazing how much thought goes into something that seems so obvious once it’s invented.

Darren November 14, 2011 at 8:05 pm

It’s really quite amazing how much thought goes into something that seems so obvious once it’s invented.

I just got done watching “Meet the Robinsons” with my son (again). Great kids’ movie (boy genius inventor, bad guy, time travel, flying car) with the message that you learn from every failure and just keep trying.

Stone Glasgow November 14, 2011 at 2:27 pm

And amazing how much real work and risk and attention go into new things. Thinking of things is the easy part; actually creating something is the hard part.

My brother and I broke a disc sled in half and used its pieces as snow boards, and we were young children. We thought to ourselves “someone should make real snowboards, just like skateboards without wheels.” Many years later someone actually did the work. I’m sure a million people “invented” them before that time.

Ken November 14, 2011 at 4:03 pm

Look outward. Entrepreneurs see things others don’t see. There are unmet and ill-met needs all over the place. Even things like the Walkman and iPod started with customer-type questions. For the Walkman, it was, “How can I (a Sony executive in Japan) listen to opera on trans-Pacific flights?” For the iPod, it was Jobs asking, “Why can’t people carry all their music around with them?”

Israel Kirzner’s work goes into entrepreneurial enactment vs. discovery.

Darren November 14, 2011 at 8:10 pm

There are unmet and ill-met needs all over the place.

It sounds like demand preceding supply. It just takes someone with the insight to recognize the demand plus the desire and persistence to produce something to satisfy it. I suppose it depends on how you define the terms, though.

Stone Glasgow November 14, 2011 at 7:37 pm

Yes, they see things many others don’t see, but many people see things that need improvement or have creative and helpful ideas. The difference between a normal person who sees a need or has a bright idea and an entrepreneur is that one of them actually does something. He actually takes the risk and puts in the time to get the product to market. And that’s the hard part.

I’m sure many people said to themselves “someone should make a portable record player,” or “someone should make a Walkman that uses a computer hard drive instead of tapes.” We all have these ideas all the time. And many of then are brilliant.

The bad ideas end up on late night infomercials. The good ones end up in every home, and they all required that someone get off their ass and take the risk that his idea might actually be a good one. It’s very hard to trust yourself that much — all your friends will ask “if that’s such a good idea, why hasn’t anyone done it already?”

Gil November 14, 2011 at 11:32 pm

Indubitably. The real riches to mass market such products and not simply inventing them.

Darren November 14, 2011 at 8:01 pm

I’m still waiting for that good idea….

Reusable toilet paper.

Fred November 14, 2011 at 8:39 pm

It’s called Glad Cling Wrap.

Chris Bowyer November 14, 2011 at 12:36 pm

Remembering that the things we have are not inevitable facts of life is a valuable thing to have instilled in you, and I’m glad my parents instilled it in me. It’s probably all the more important these days, given how often we see a new technology spring up, become ubiquitous, and then see the absence or delay of same to be an intolerable suffering, all in the span of a few months.

Randy November 14, 2011 at 1:12 pm

Ever notice, though, that political products are seldom innovative? Its always just variations on the same old idea, “Lets go take some money from somebody and give it to our friends”.

John Muir November 14, 2011 at 1:17 pm

Exactly! Many people call that political cronyism.

Fred November 14, 2011 at 1:30 pm

crony capitalism aka crapitalism

Methinks1776 November 14, 2011 at 1:46 pm

My husband calls it “entremanurism” .

Randy November 14, 2011 at 1:51 pm

:)

El Diablo November 14, 2011 at 1:51 pm

I call it “muirgeoism.”

Stone Glasgow November 14, 2011 at 2:35 pm

No need for innovation. This design has worked for 100,000 years. Until recently, it also involved taking people and giving them to friends.

GAAPrulesIFRSdrools November 14, 2011 at 2:30 pm

You might like Burton Folsom’s book on the “Robber Barons”, if you haven’t already read it.

dave smith November 14, 2011 at 2:52 pm

Peter Drucker is under-read by economists, I think. His work illustrates how much effort goes into simple genius.

Ryan Vann November 14, 2011 at 3:02 pm

While I agree with the general thrust of this post, I’m uncomfortable with the human resource designation; there is something sinister/creepy about the term.

Signed, Human Resource#4,179,964,117

GAAPrulesIFRSdrools November 14, 2011 at 3:22 pm

You are too hard on those wonderful people called “HR”, just think what life would be like if they weren’t busily working in their little unaccountable echo chambers and free to turn their existential conundrums into lengthy, inscrutable policy manuals (yes I realize they post them electronically now) that nobody can read, let alone follow and whose objective appears to be merely to create new authority for them and their kind.

They’d become regulators and dang good ones to boot! We don’t need a vast army of the unemployed to readily, willing and able to serve as shocktroops in the service of the army of the endless parade of statist ambitions!

Of course, Scott Adams had it right in “Dogbert’s Top Secret Management Handbook”-he quipped about HR, that they were like lawyers, just without the charm and verbal skills. Then again, I regard the bar as a self serving cartel.

Ryan Vann November 15, 2011 at 10:28 am

“that they were like lawyers, just without the charm and verbal skills.”
Hilarious

“Then again, I regard the bar as a self serving cartel.”

Is there another way to regard the BAR?

SmoledMan November 14, 2011 at 3:03 pm

How did Thomas Edison, Tesla invent anything without public roads and government to help him?

Methinks1776 November 14, 2011 at 3:07 pm

My thinking exactly. How did man invent tools, the wheel or figure out how to start a fire without government roads and marauding gangs called “police”?

Fred November 14, 2011 at 3:11 pm

I’m wondering how any economy ever grew to the point where it could support a government capable of saving it from recession without a government to save it from recession.

Randy November 14, 2011 at 3:41 pm

Good one :)

Ryan Vann November 14, 2011 at 3:15 pm

Historical revisionism on your part. It is a well known fact that Algore started the commision that developed both the stone hand axe and the internet.

John Muir November 14, 2011 at 3:21 pm

:)

Gil November 14, 2011 at 11:42 pm

Strange how pretty much most technological progress had come from nation-states? How many ancients figured out how to carve and transport large stone to make temples for the “gods”?

Ryan Vann November 14, 2011 at 3:11 pm

Wasn’t Thomas Edison, along with Henry Ford, a sort of prototype MMTer?

GiT November 14, 2011 at 4:20 pm

Um, Edison accumulated over 1,000 US patents over his lifetime.

One might ponder where a US patent comes from.

John Muir November 14, 2011 at 4:21 pm

Edison had to come up with the idea first. Then, the patent is filed.

John Muir November 14, 2011 at 4:21 pm

Keep pondering GiT.

vidyohs November 14, 2011 at 7:04 pm

Think he’ll figure out it comes from a U.S. Patent Office?

Naw, asking for obvious logic is too much to ask of a looney left broken brain.

John Muir November 14, 2011 at 8:16 pm

Good point, Vidyohs!

Gil November 14, 2011 at 11:39 pm

Edison mostly bought his best inventions (notably Tesla). He was more of a curious tinkerer than an inventor. He was super-rich because he was, first and foremost, an astute businesssman.

GiT November 15, 2011 at 3:49 am

And to come up with the idea he needed a laboratory, with staff (many of whom were responsible for the ideas he patented), which he funded with a patent he sold for $10,000 dollars.

A patent he was able to sell because he acquired it from a US government agency.

A patent which conferred a license to exclude others from producing something, as backed by the threat of government force.

And a lab which only made sense as a business venture because that force could be relied upon to both 1. protect Edison’s contractual claim to ownership over the IP rights for inventions made in his labs; and 2. make ownership of those patents meaningful and valuable by forcefully excluding anyone who attempted to violate the IP right (like, say, the person responsible for the invention, e.g. Nikolai Tesla, in one case.)

It’s a pity I had to lead you through the steps. They’re pretty obvious.

Gil November 15, 2011 at 5:10 am

Don’t forget Hollywood was built to get away from Edison trying to monopolise the film industry.

John Muir November 15, 2011 at 11:05 am

Yet, his idea comes first otherwise he would not have had enough information to fill out the application for a patent.

It really is terrible to point out the painfully obvious. But, in dealing with stupid gits, it happens all to frequently.

GiT November 16, 2011 at 2:03 am

Except the incentive to follow through on an idea is often times constituted by the compensation would bring. And the possibility of being reward for invention is often times a necessary condition for someone without luxury/leisure to devote their energies to the process.

It’s really not too hard to grasp. If Edison had not been able to count on a somewhat secure right to his intellectual property, as guaranteed by a patent which excludes competition and grants a monopoly via government, would he have invented all the things he did?

If not, then, clearly, government helped him invent. Stable property rights encourage economic activity- isn’t that one of the basic facts around here?

GiT November 16, 2011 at 2:04 am

ugh, horrible typos.

by the compensation *the invention* would bring.

the possibility of being reward*ed* for invention

Gil November 14, 2011 at 11:36 pm

Edison (and Tesla to a lesser extent I s’pose) cleaned up with patents and, strangely enough, would be a good example for anti-I.P. Libetarians.

kyle8 November 14, 2011 at 4:25 pm

And it wasn’t just “Someone”who thought of these things. Nearly every great invention, technique or product has been the child of a very few gifted individuals.

This is how we progress, not because of the toil of millions of mediocrities, but because of the tiny few special individuals.

That flies right into the face of the rampant egalitarians among us.

John Muir November 14, 2011 at 4:27 pm

True that…I can think of many highly innovative people who created things that have greatly benefited us all. The one most in the news lately is Steve Jobs.

Darren November 14, 2011 at 8:18 pm

Innovation comes in all sizes. Most people think of the ‘great’ inventions (telephones, airplanes, cars, internet porn). However, almost every product has been improved incrementally over the course of time through thousands of tiny innovations. It might be some guy working on an assembly line that realizes how his job might be done just a little better. The idea gets passed up to the manager and it gets implemented, saving the company maybe only hundreds of dollars. It doesn’t take a flaming genius to contribute to the overall advancment of technology.

Gil November 14, 2011 at 11:37 pm

That’s what I been saying all along – a few progress humanity while many hold humanity back. Hence a human being isn’t a valuable resources per se. Maybe a better quote is “Homo sapiens sapiens are potentially valuable resources not Hom sapiens”.

John Muir November 15, 2011 at 8:50 am

GiT, human beings are valuable resources BECAUSE without all those human beings doing other things the one really great innovator would be busy hunting, cooking, clothing himself, etc to have time to develop that great idea. Also without other people to benefit from that idea, the innovator is unlikely to have had it.

John Muir November 15, 2011 at 8:51 am

Sorry, that comment should have been addressed to Gil not GiT.

Nevada Doctor November 15, 2011 at 4:26 am

Picasso’s first word was “piz” short for lapiz, Spanish for pencil. If your boy’s first word was ball, it’s because every infant recognizes the handiwork of their mindlords. Your kids appreciate their shelter, their food, their fuzzy blanket, things in the main made by your betters.
The worst way of living is to construct and enforce a fake reality of parents, baby toys, baby talk, cribs, and unproductive affectations and primitive rituals.
Champion the anarchitects who daily through painstaking trial and error are moving us forward. In a world teaming with magic, why allow one minute of your family’s finite life to be about anything less than genius and wonder.

Richard W. Fulmer November 15, 2011 at 8:39 am

As much as I admire Steve Landsburg, I’m going to dissent on this one. Products are not available “only because somebody thought of them.” How many brilliant products have been “thought of” only to lie fallow? Consider the steam engine that Hero of Alexandria invented around the time of Christ. His idea had the potential to change the world but nothing was done with it. Progress requires far more than ideas. It requires entrepreneurs with the imagination to see an idea’s potential and the energy and skill to make that potential real.

Jon Murphy November 15, 2011 at 12:14 pm

Right, but someone had to think of them first. Thought isn’t the only thing required for innovation (if it were, we’d all have teleporters).

SheetWise November 16, 2011 at 2:50 am

There is also the knowledge that capital is available to see a concept through to prototype, proof of concept, acceptance, and manufacturing — and that there is a rule of law in place to protect you through that process. Eliminate either and ideas are just wet dreams.

tms November 15, 2011 at 3:06 pm

Or as some on the left might say: “Each of our material comforts is the product of an act of exploitation. Cars and computers and supermarkets are all there only because somebody got screwed.”

SheetWise November 16, 2011 at 3:09 am

They do say that. Then they create co-ops, where people donate their time — and they write slogans like “Food for People — Not for Profit”. And then after a few years the founders get older, and tired of spending $5 for the same thing sold at the Safeway for $3 — and start shopping at the Safeway. They spend the rest of their life trying to figure out how a profit making enterprise could actually pay their help and undersell a benevolent enterprise.

I can save them a lot of trouble. It’s all a conspiracy — and it’s aimed at you. Don’t let your guard down, because our operatives will soon make their way into your home town. There is no escape.

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