The real trickle-down economics : science to products

It is no secret that every nation has benefited from incorporation into the economy. The flow of goods and ideas is beyond the imaginings of Adam Smith, as he wrote of in The Wealth Of Nations, about purchasing abroad what is too expensive at home.  It was his proposal that a nation is richer when it chooses not to make uneconomic goods at home and buys them from somewhere else.

His vision and ideas have shaped all the economies, trended them towards integration, and made their citizens more prosperous than they could otherwise be in the old world economic view.  If you need proof, look at the standard of living of the nation that is the least integrated into the rest of society: North Korea. The people there live in the worst conditions and share the bleakest outlook of all.

The problem now is that globalization, the Internet, and international corporations have changed the problem to the other extreme: instead of being hard to set up a business it is getting harder and harder to keep a business going when you can find another cheaper work force and move the factory, the machines and the senior people to a new location, new tax zone, or new hemisphere. How can established nations retain work and therefore workers and taxes when it is so easy to lose them?

Here is a new law that describes this new reality.  The Law of Production Mobility: any skill, technique, or trade that derived from science and engineering that goes into goods production can be passed on when sufficient time, information, and education is available.  The longer the public is aware of it, the less unique it is and therefore the less valuable it is over time.  The more times it is refined or improved, the more likely it is to transfer to less developed nations.

This means any skill has a expiry date on it.  If it can be simplified, trained, divided, and made into YouTube videos then the workforce that depends on that skill set will eventually be too expensive to compete in the labour force of the future.  No work force can expect an infinite duration of the task providing for the family.  By design, all high tech becomes low tech.

What does this mean for nations?  It means that any strategy where they expect a skill to remain is a losing one. Any nation that relies on companies to generate all the economy is equally unwise. Companies are animals of profit, they cannot innovate without risk and loss and they have a vested interest in selling what they have. Also, they tend to find cheaper work forces and offload the more cost expensive parts of the products to the less developed nations. It is as natural way to offset rising labour costs. You can't expect them to operate differently if they are national or international.

What is true is that science, namely research or basic science leads to engineering, that leads to new products and new services. Research is the discovery of new ideas, new methods, new things. Those that research new areas are the first to know the discovery. The engineers and technicians that work with them build upon, expand and develop these ideas further into new ways that are better,faster, cheaper than the existing technologies in the world.

The fact is that the work surrounding a new discovery is hard to move from the place where it took place.  Yes, journals and papers are written and people can reproduce the work. But the reality is that development of an idea or process take times and effort, lots of mistakes and prototypes. That succeeds when the effort is centralized in one long chain from the lab to the factory floor. The new technology is valuable on the world stage and the value is.

Any nation that wants to keep the longest chain of workflow from a research to technology develop net thence into products for the world must concentrate on research at the beginning of the chain. Concentrate the resources t providing society the largest suite of technology from research. This trickles down the maximum value back into society for money invested.

This is the true trickle down economics.