… is from page 3 of the late Stanford University economic historian Nathan Rosenberg’s “Introduction” to the 1994 collection of several of his papers – a collection titled Exploring the Black Box: Technology, Economics, and History (original emphasis):
It is easy to conclude that, whatever the difficulties and uncertainties in developing a new product might be, anticipating the subsequent uses of the new product, once developed, would be relatively easy. Such a conclusion, however, is not borne out by history. On the contrary, it appears that it has been remarkably difficult to appreciate the potential significance of an invention at the time of its first introduction.
DBx: Take heed of this reality if you’re sympathetic to arguments in favor of industrial policy. The future is not for us to know in sufficient detail to suppose that large-scale efforts to plan whole economies, or large swathes of an economy (for example, “the manufacturing sector”), will succeed in improving the economy for the masses of its denizens. This fact is only strengthened by the realization that such government interventions are carried out by politicians and bureaucrats who spend other people’s money – and hence are not tightly inspired or constrained by the profit motive – as well as intentionally ignore or suppress the information conveyed by prices and other market signals.
