Tuesday, January 22, 2008

Sex, Science & Profits: How People Evolved to Make Money by Terence Kealey [International]

What does marijuana tell us about the government funding of science? Well, a vast amount of taxpayers’ money around the world is spent on agricultural research to improve yields. Yet, according to Terence Kealey, pot-growers manage nicely without that aid and have developed “ever stronger and ever more disease-resistant strains” of literally mind-blowing potency.

The case of the cannabis cultivators is characteristic of the irreverence and eclecticism that make Sex, Science & Profits such an absorbing read. The author, who is a clinical biochemist at the University of Buckingham, seeks to demolish the myth that the advancement of scientific learning depends in any way on government intervention.

Four centuries ago, Francis Bacon wrote that “the benefits inventors confer extend to the whole human race”. Economists deem science to be what they call a “public good”, that is, a good of general benefit for which it is impossible to charge. What the market can’t charge for, say the economists, the market won’t provide. They go on to claim that scientific and technological progress will be arrested unless the government provides funds for pure research and companies are rewarded with patents for innovations in applied science. It is also often suggested that government funding of science drives technology which, in turn, generates economic growth.

Kealey disagrees. Rather than science driving technology, the opposite is true. The great inventors in Britain’s industrial revolution, including the steam-engine pioneers Thomas Newcomen and Richard Trevithick, were not fellows of the Royal Society. They were barely literate artisans who found intuitive solutions to practical problems (in Newcomen’s case, how to remove water from Cornish tin mines). Technological breakthroughs often lead science. At the moment of its invention, the steam engine designed by James Watt disobeyed the laws of contemporary physics.

Where property rights are protected and markets are allowed to thrive, technology and science advance together. Merchants invented writing and mathematics in Babylonian times in order to keep their accounts. Science stagnated during the anti-commercial Middle Ages, but re-emerged in renaissance Italy, along with commercial innovations such as double-entry book-keeping, bills of exchange and banking. Kealey identifies the Glorious Revolution of 1688, which guaranteed property rights and the rule of parliament, as the key moment in Britain’s scientific and industrial revolutions. Free markets and competition spur technological innovation and economic progress. Patents are not necessary to drive research and development. Companies, says Kealey, will innovate in order to differentiate their products and boost profits even without patent protection. Philips, one of the world’s largest electronics concerns, was founded in Holland in the 19th century at a time when the Dutch had dispensed with patent laws. During the same period, Swiss chocolatiers innovated successfully despite the absence of domestic patent protection. Many of the great technological advances weren’t made for the love of money but spurred by the joy of invention. Today, computer scientists around the world provide their expertise without charge to develop open-source computer programs, such as the Linux operating system.

Technology and science advance by copying. Yet patents hinder copying, prevent competition and thereby reduce innovation. That leads to slower economic growth. James Watt’s fierce enforcement of his patents held back the development of steam technology by 25 years, says Kealey. During the first world war, the American government decided to suspend the aeronautical patents held by the Wright Brothers in order to promote aircraft innovation. From 1917 to 1975, American aircraft companies collectively pooled their patents. That didn’t stop Boeing from becoming the world’s leading aircraft manufacturer. Kealey also maintains that the American motor industry took off only after Henry Ford breached the patents held by an automobile consortium. A key feature of Apple’s iPod, which has revolutionised the world of digital music, was taken from a competitor’s product.

What about the government funding of pure science? That’s also unjustified, says Kealey. For a start, the distinction between pure and applied science is artificial. Scientists at Bell Labs, the research institute of the telephone giant AT&T, discovered the science of radioastronomy and developed the first semiconductors. In America, IBM boasts the second largest output of published academic papers after Harvard University. Furthermore, there is some evidence that government funding of science leads to less private research. In the 1980s, Mrs Thatcher was attacked for cutting the British government’s science grants. Yet private companies stepped into the breach. As a result, spending on research and development in the UK actually increased.

Scientists have long claimed that science was suffering from the lack of public funds. In 1830, Charles Babbage, the supposed father of the computer, published The Decline of Science in Britain. But the following year, as Kealey points out, Michael Faraday discovered electromagnetic induction and Charles Darwin boarded HMS Beagle. The great advances of Victorian science occurred without government support.

Sex, Science & Profits is a gloriously idiosyncratic work. In developing his argument, Kealey discusses, among other matters, the banking systems of Ptolemaic Egypt, game theory, 12th-century English windmills, the mating calls of humpback whales, and the functioning of ball-valve flushing lavatories. His intellectual enthusiasm is infectious — one is half persuaded when he writes that “it is impossible to read WH Long’s article ‘The Low Yields of Corn in Medieval England’ without astonishment”. His approach is polemical, witty and fearless. Only once does he wobble, when admitting that drug research is now so expensive and time-consuming that patent protection may be justified.

In The Wealth of Nations, Adam Smith claimed that the public interest was best served when the government ceased attempting to direct the economy. Kealey has brilliantly extended his hero Smith’s argument to the world of science, which, like that of commerce, involves much “truck, barter and exchange”. The twin trends of globalisation and digitalisation have enormously benefited certain holders of intellectual property rights, such as Bill Gates’s Microsoft. We need an informed debate on the extent to which those windfall gains are deserved. Sex, Science & Profits provides an excellent starting point.

SEX, SCIENCE & PROFITS: How People Evolved to Make Money by Terence Kealey
Heinemann £20 pp455

1 comment:

Marilyn said...

Keep up the good work. Cheers:-)