Comments on: Dynamism 1, 2, 3 http://cultureby.com/2004/04/dynamism_1_2_3.html This Blog Sits At the Intersection of Anthropology and Economics Thu, 17 May 2012 21:10:32 +0000 hourly 1 http://wordpress.org/?v=3.3.1 By: Anonymous http://cultureby.com/2004/04/dynamism_1_2_3.html/comment-page-1#comment-8110 Anonymous Fri, 30 Apr 2004 22:35:14 +0000 http://localhost/wp_culture/?p=1236#comment-8110 Steve, but this is the question: what difference does the difference make? I think in most cases, and this is clearly true in the Google one, private companies that can go public and don't go public, are forgoing huge profits and this suggests that they are in possession of some larger sense of mission that almost quarantees that they are committed to innovation. (I guess there is the possibility that some will stay private to remain "loyal to their principles" and in the process back away from innovation, but this seems to me less likely.) Anyhow, it is an empirical question and someone must have asked (and answered) it. I have placed the question with interested parties and we shall see what they say. Thanks for a very useful post. Steve, but this is the question: what difference does the difference make? I think in most cases, and this is clearly true in the Google one, private companies that can go public and don’t go public, are forgoing huge profits and this suggests that they are in possession of some larger sense of mission that almost quarantees that they are committed to innovation. (I guess there is the possibility that some will stay private to remain “loyal to their principles” and in the process back away from innovation, but this seems to me less likely.) Anyhow, it is an empirical question and someone must have asked (and answered) it. I have placed the question with interested parties and we shall see what they say. Thanks for a very useful post.

]]> By: steve http://cultureby.com/2004/04/dynamism_1_2_3.html/comment-page-1#comment-8109 steve Fri, 30 Apr 2004 18:46:48 +0000 http://localhost/wp_culture/?p=1236#comment-8109 A small correction: GE did not invent Six Sigma--Motorola did, I believe. Jack Welch was initially opposed to bringinig it in to GE, but other executives bascially circumvented him and then he became a true believer. A big correction: There is no question that public companies are under more pressures to conform with the expectations of investors than are private companies. Whether the private company behaves in a more innovative fashion than the public one depends, however, on how the private company would use its freedom. I wouldn't necessarily endorse this argument, but the ecomoic historian Williiam Lazonick has argued, for instance, that British entrepreneurs in chemicals and other industries lost their lead to the Germans and the Americans because they stayed private for a long time. The Germans and Americans, by going public were pressured to maximize profits and so to make huge investments in building giant plants that could exploit scale economies; the Brits, he claims, were much more conservative and worried about preserving their ownership and control. I'm not sure that he doesn't have the causality reversed, though. A small correction: GE did not invent Six Sigma–Motorola did, I believe. Jack Welch was initially opposed to bringinig it in to GE, but other executives bascially circumvented him and then he became a true believer.

A big correction: There is no question that public companies are under more pressures to conform with the expectations of investors than are private companies. Whether the private company behaves in a more innovative fashion than the public one depends, however, on how the private company would use its freedom. I wouldn’t necessarily endorse this argument, but the ecomoic historian Williiam Lazonick has argued, for instance, that British entrepreneurs in chemicals and other industries lost their lead to the Germans and the Americans because they stayed private for a long time. The Germans and Americans, by going public were pressured to maximize profits and so to make huge investments in building giant plants that could exploit scale economies; the Brits, he claims, were much more conservative and worried about preserving their ownership and control. I’m not sure that he doesn’t have the causality reversed, though.

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