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BOOK REVIEW

Innovation Dissected

John F. Ahearne

Paths of Innovation: Technological Change in 20th-Century America. David C. Mowery and Nathan Rosenberg. 216 pp. Cambridge University Press, 1998. $27.95.

This small book sets out to demonstrate "that the simultaneous emergence of new engineering and applied science disciplines in the universities in tandem with growth in the R&D industry and scientific research has been a primary factor in the rapid rate of technological change." The authors point out that it takes years, if not decades, to introduce a new technology. They stress that innovation is highly path-dependent—that the "initial conditions under which an innovation appears and is refined for economic exploitation exert a powerful influence over the types of knowledge required for its exploitation, the types of knowledge generated from its exploitation, and the evolutionary path followed by the technology."

The authors focus on four different areas, the first being the internal combustion engine. They find that "the refinement of the internal combustion engine progressed during the early years of this century with little or no assistance from academic research." Viewing the automobile as "a singular, transforming innovation," they describe the growth of the industry, including Henry Ford's introduction of mass production. They conclude that competitive pressure is quite important in maintaining innovative performance and that the challenges brought about by foreign imports and the sharp increases in the price of gasoline during the 1970s led to major changes in U.S. automobile manufacturing. The North American automotive industry's consumption of integrated circuits is larger than that of the U.S. defense industry, highlighting the transition into the more modern era of instrumentation and control. The airplane is included with the automobile as a major user of the internal-combustion engine. The authors note that although "until the Second World War, most of the leading scientific research in aerodynamics was performed in Germany," the American DC-3 became the most widely used commercial airplane. U.S. researchers were also "were to recognize the potential and feasibility of jet-powered aircraft."

Cross-industry interaction is another major point. In their descriptions of technological innovation, the authors concentrate on the U.S. chemicals industry. As in aerodynamics, Germany had been the leader in chemical research, and the German chemical-engineering efforts were significant in World War I, in the period between wars and in World War II. The authors conclude that the eventual predominance of the U.S. chemical and petrochemical industries "was in large measure the achievement of the chemical engineering profession" and attribute to MIT development of chemical engineering in the United States. The authors describe the rise of the petroleum-based chemicals industry, including the development of plastics, synthetic rubber, synthetic fibers and pharmaceuticals and conclude that the crash program to develop the large-scale manufacture of penicillin during World War II was "the first great success of biochemical engineering."

The third area is electric power, primarily the generation of electricity and electric motors. The authors point out that dishwashers, vacuum cleaners and many other devices had been developed as far back as the 1850s and 1860s but were not put into useful forms until electricity and electric motors "rendered them practicable." They note that electricity is a clean and efficient means to process materials. For example, an electrolytic process transformed aluminum from an extremely expensive commodity (selling for $545 a pound in 1852) to a major material for commercial products.

Finally, the authors address the "electronics revolution." Here, they bring out another of their points on technological development, namely, that a bottleneck can lead to a major development. In this case, the Bell Laboratories research program that produced the first transistors was focused on the need to get rid of mechanical switching devices that were seen as being the obstacle to expansion of the telephone system. The authors describe the development of the transistor and the integrated circuit. As in several of the technologies described, they note that "U.S. universities played a minor role as direct sources of the technologies applied in the emergent semiconductor industry." This is in contrast to university prominence in the chemical industry or the U.S. computer software industry.

The authors believe that "natural resources acquire economic value only as a result of the development of technological capabilities that are by no means provided by nature." To illustrate this, they write:

The electric arc furnace converted bauxite from an ore of no economic significance to a valued source of a new metal with commercially attractive characteristics. The same electric arc furnace converted scrapped automobiles into a low-cost source of steel. The Haber-Bosch process converted atmospheric nitrogen into an unlimited source of fertilizer. The automobile and the chemical engineer transformed petroleum from a resource of modest importance as an illuminant to a resource of immense economic significance in transportation, industrial materials, and textiles.

This book, by two well-known economists, reads easily and is a valuable addition for those interested in examining U.S. technology developments. Mowery is a professor at the Haas School of Business at the University of California at Berkeley and Rosenberg is professor of economics at Stanford. Both authors are widely published economists, Rosenberg with several books using the term "the black box" to describe how economists treat technology and Mowery with many econometric studies of technological growth. This book is not a deep economic analysis—it is almost entirely qualitative, although there are data sets and figures. There are several textbooks that treat the technological development from a broader perspective in that different views are presented. Two such are Technology, R&D, and the Economy, Bruce L. P. Smith and Claude E. Barfield, eds. (1997), with a short comment by Mowery, and Empowering Technology: Implementing U.S. Strategy, L. M. Branscomb, ed. (1993).–John F. Ahearne, Sigma Xi Center, Research Triangle Park, North Carolina


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