[ExI] Private and government R&D

Stefano Vaj stefano.vaj at gmail.com
Mon Jun 29 15:41:56 UTC 2009

On Mon, Jun 29, 2009 at 5:00 PM, Dan<dan_ust at yahoo.com> wrote:
> Also, that said, there is the Baconian motive for investing in pure science research: that out of pure research, private individuals and firms might expect some long-range benefit.*  IBM, for example, might be investing in quantum computing (as they invested in a lot of other projects previously, some of which foundered; we must remember a lot of research, private or no, comes to little or nothing**) because it's "thinking" long range and wants to be ahead of the pack should it take off.

Mmhhh. Not necessarily. Unless a monopolistic regime is in place
(e.g., a patent system), which may not be entirely kosher from a
"libertarian/marketist" POV,  this motive would be per se quite
dubious, as free riders would be better off by saving the money thus

Accordingly, the company concerned should be confident either of its
ability of maintaining an industrial secret on the outcome of the
research - something which is normally impossibile with product tech
-, or that a temporal edge in terms of time-to-market would be enough
to repay the investment - another thing which is all but certain in
fundamental, high-risk research projects.

Thus, the private sector engages in fundamental research either
because... it can afford it - a scenario which may suggest margins
generated by a market inefficiency... :-)  -, or because of other
by-products of such investment, such as the returns in term of
corporate prestige or additional goodwill.

Stefano Vaj

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