The main idea of this book is to review 50 innovations that had significant impact on human live. The very important part of this idea is that author reviews not only technological innovations, but also societal and quite convincingly demonstrates that such inventions had maybe even more impact on quality of live than technological inventions.
- The Plow
It starts with imaginative scenario when civilization had to restart from the scratch. Author answers to the question where to start with reference to the first invention: plow, which become main tool of agriculture and consequently foundation of civilization. Then in introduction author defines how he selected inventions for this book – not according to their importance either economical or technological, but rather as illustration of some common themes relevant to nearly all inventions.
- Winner and Losers
The common theme in this part is approach to inventions and the new technology from the point of view of winners and losers of this invention.
- The Gramophone
This invention and its spinouts could be generically defined as recording of sounds and images has a number of very clear losers: all people who produce such sounds and images that valuable enough for other people to pay for. The obvious winners are majority of population that now has access to such information produced by the top talent at low price, often even for free even in situation when the person with the talent is long dead. Also, winners are top talents who now can sell their production to millions and correspondingly earn millions. Obviously, the biggest losers are mediocre talents who used to be able successfully compete in a limited locality with access to people close to this locality in time and space, but now have to compete with everybody in the world who ever lived.
- Barbed Wire
This invention dramatically changed human ability to control agricultural property either land or cattle and as such it facilitated Western development in XIX century. Obvious winners were owners and consumers of agricultural products, while squatters become losers with their chances of apprehending free land greatly diminished.
- Seller Feedback
This is about contemporary invention of feedback on business transaction via Internet when individuals not really familiar with each other have new ways to evaluate reliability and honesty of the person on other side of transaction. This invention basically involves a protocol of human relations that decreased cost and increased reliability of transactions and made billions of users of peer-to-peer transactions better off. Obvious losers are crook and unreliable people.
- Google Search
This invention is not really Google, but all computerized search dramatically changed information inequality between parties of business transaction when on one side is professional seller or buyer who has time and resources to invest into market knowledge development because he/she conducts multitude of similar transactions, while on another side is onetime customer who could not possibly do the same. As result traditional outcome was overpayment. In the new world consumer could spend a few minutes to obtain information and level playing field. As usual, the winners are multitude, while losers are professional information traders from used car salesmen to librarians.
Here author discusses not that much passports as tool of control over people movements, as immigration of labor and its pluses and minuses. He is firmly on the side of pluses even stating that some economists evaluated that free movement of labor would double world output. But after conceding that it would probably not going to happen any time soon, author defines winners and losers, by wealth of the country that issued passport.
This is mainly about all technology based on AI and robotics that could do multitude of tasks that used to be done by people. Obvious losers are people who lost their jobs, but author points out that robots’ bodies are not as good as their AI brains so humans still can find jobs cleaning toilets, at least for a while.
- The Welfare State
This is societal invention of moving responsibility for individual for his/her wellbeing away from this individual, family, and community to the government that would take care about everybody. Author links it to the motherly love with government being the mother, but still points out that it could be too much love so people could be spoiled. Author end this with positive reference to idea of guarantied income.
- Reinventing How We Live
This part is moving from winners and losers of innovation to their impact on our lives and overall functioning of society that changed quite dramatically in recent times.
- Infant Formula
Author retells an interesting story of this invention prompted by volcano eruption resulted in decrease of food supply, so some artificial concoction helped babies without mothers to survive. The resulting separation of infant feeding from mother’s bodies had profound impact on their survival, but also on availability of their mothers for work and other activities that would put distance between them and babies.
- TV Dinners
Somewhat similar effect had invention of industrial food processing that by now provided infinite number of fully or semi processed food freeing humans from necessity to spend a few hours every day preparing food from scratch, which is not very productive activity anyway.
- The Pill
This is about contraceptive pill that drastically changed stakes in sexual encounters by decreasing probability of pregnancy. It not only become foundation of sexual revolution, but also revolutionized economics by opening way for women into professions and other economic activities that demand allocation of time and effort inconsistent with continuing care for multiple children.
- Video Games
It is interesting that author puts video games into category of society changing inventions. He does it based on economic impact of the new form of entertainment that demands some programming effort, but provides a hugely popular way of waste available time, without which the time could be used in less benign for societal stability way.
- Market Research
This is another societal invention that has significant impact on economy. Market research became a tool of discovering and sometimes creating consumer desires, resulting in much higher level of satisfaction for customer and increased economic activity.
This relatively new invention was prompted by industrial needs, but it opened way for maintaining temperature controlled environment that consequently improved health by decreasing impact of high temperature and, as side effect opened hot South to settlement elsewhere in the world.
- Department Stores
Author presents department stores as invention of not that much concentrating lots of different merchandise in one place, as the development of different attitude to customer, moving from naked strive to sell to much softer attitude of presenting goods and politely helping customer to generate and eventually satisfy desires that they may not have before they start looking.
III. Inventing New Systems
This part is about generating new standards that greatly facilitate exchange of goods and services, by adding compatibility between them and allowing to build unique system and environment serving specific individual needs from parts produced by diverse providers.
- The Dynamo
This is about one of the most important standardized good – electricity and how it slowly over some 50 years substituted steam powered energy supplies in business and the huge impact it had on the methods of production.
- The Shipping Container
This is about the invention that did pretty much the same for transportation. The use of standard containers allowed practically eliminate reloads between different forms of transportation resulting in dramatic decrease of it costs, which in turn opened opportunity for globalization.
- The Bar Code
This is another supplemental information processing technology that allowed relatively easy tracing of smallest goods all around the world, making it another tool of globalization.
- The Cold Chain
This starts with reference to banana republics of Latin America, but then returns back to looking at technological achievement, in this case Cold Chain that actually means refrigerated transport, the technology that allows people elsewhere in the world enjoy bananas and millions of other things that would spoil without cooling. Besides opening for everybody everywhere all fruits and goods that this planet can offer, it provided good insurance against poor harvests and other things that caused lots of problems in the past, but now can be easily managed by transporting staff from the places where it is in abundance at the moment.
- Tradable Debts and the Tally Stick
Author refers here to the old Irish tool of recording debts and then discusses financial mechanisms of supporting trade, manly in primitive and exotic way.
- The Billy Bookcase
This is about another invention that author refers as IKEA’s – shift of final assembly to customers site. The big deal here is that by doing it manufacturer can package product in the most efficient for transportation form, sharing with customer savings on cost transporting a few cubic feet versus a lots of cubic feet of some goods like furniture. Probably the cost of final assembly by customer is much higher that it would be at the plant, but since people usually do not count their own time and effort as money, the method is quite popular.
- The Elevator
This is another technological improvement that greatly changed circumstances of human live. It practically opened the third dimension of space for human settlement. The small one or two-story building providing shelter to one family now can be substituted by multistory skyscraper that provides shelter to hundred families using the same amount of land. While it is not really such a great thing for many people who would prefer not to live on the top of each other, it is perfect for industrial and business facilities providing extremely high-density places for work easily supplied, protected, and cheaply supported.
- Ideas About Ideas
This part is about invention of metaideas, which are the ideas about processing information.
This is about an ancient method of writing – the first known method to represent words in abstract pictorial form. Probably nothing could compare with this invention because it moved humans to situation when they could maintain totality of knowledge infinitely higher than sum of knowledge in the heads of all living people.
- Public Key Cryptography
Here author jumps from ancient and hugely important invention to the recent and much less important invention in cryptography. It is nice and dandy, but it has limited application and could and probably will be discarded in the next few dozen years when and if need to keep secrets decrease.
- Double-Entry Bookkeeping
This is obviously more important and much longer living invention, but it is also becoming somewhat obsolete with the continuing progress in technology of capturing and processing information, when much more effective processes and controls developed all the time.
- Limited Liability Companies
Here author discusses invention of limited liability companies as a necessary condition for existence of capitalism supported by opportunity to limit one’s financial exposure and consequently provide more security for investment that was ever possible before.
- Management Consulting
Here author describes managerial consulting as highly value-added activity mainly based on example of its application in Indian textile factories and then quite skeptically discusses effectiveness of this business altogether. Eventually he concludes that it is necessary mainly due to government regulations.
- Intellectual Property
This is another recent (250 years) invention, which is not clearly beneficial. Author even discusses work of economists Boldrin and Levine who suggest ridding of it altogether arguing that it is more an impediment to business than support for new inventions.
- The Compiler
This final chapter in this part is somewhat technical. Computer compiler is the great tool that made programming a lot easier, but it is just one of the steps in development of information processing technology.
- Where Do Inventions Come From
In this part author looks at how inventions occur even if it is not the focus of this book. Author believes that inventions are not a work of a single genius, but rather culmination of multiple small changes merging into one qualitatively important change.
- The iPhone
This is one example – combination of Internet, new batteries, c radio communications, flat screens and lot of other things culminating in what is not really phone, but network integrated computer.
- Diesel Engines; 32. Clocks; 33. Chemical Fertilizer; 34. Radar; 35. Batteries; 36. Plastic;
These all are similar stories of step by step development in various seemingly unrelated area with following on integration into one new technology that delivers huge value in unexpected field.
- The Visible Hand
Here author returns to inventions that facilitate functioning of human societies and he stresses that it is based on institutions that are provided and/or supported government so the idea of invisible hand is not really applicable here.
- The Bank
The first such invention author looks at is a bank and it is a very ancient one so author traces it back to Templars
- Razors and Blades
This starts with a funny story of Gillette who started as philosopher writing against market and ended as founder of business empire. However, it is just a side show, the chapter is really about new method of selling invented by Gillette – cheap or free initial devise with need for continuing supply of expensive consumables.
- Tax Havens
This is another institutional invention that allows global businesses shopping around for smaller taxes, consequently shielding their profits from government.
- Leaded Gasoline 41. Antibiotics in Farming
This couple is used by author to demonstrate how invention could go wrong: lead gasoline poisoning people and unrestricted use of antibiotics develops drag-resistant bacterial that is difficult to handle not only in animals, but also in people.
This is about electronic currency and its use in developing countries to go around of usual corruption, for example by paying policemen directly to their iPhone rather than via their chief who take cut from these salaries.
- Property Registers
This is about property rights and their enforcement as condition of effective capitalist development in line with work of de Soto.
VII. Inventing the Wheel
In this part author admits that he did not touch a lot of the most important invention because they change the world way too much and could not fit into the limited space of this book. For example, invention of the wheel was so huge that would require many volumes to analyze. Here are a few of similar in their importance in author’s view:
- Paper; 45. Index Funds; 46. The S-Bend (sanitation); 47. Paper Money;48. Concrete; 49. Insurance;
Conclusion: Looking Forward.
This is about very limited ability of people to predict the future with examples such as book by Herman Kahn and Wiener in 1950 about year 2000. They predicted something that did happened, but also a lot that did not. However, the main lesson here is that process of continuing innovation is not only started, but acquired a huge momentum, so one could expect a lot of it in the future changing the way of live and bringing improvements both technological and societal that are not even imaginable today.
Epilogue: The Light bulb
This is an interesting approach to measure impact of invention of previous century by comparing value of $70,000 income in now and its equivalent in 1900. If adjusted to inflation it would be $1,962,800, so one could buy a lot more of goods and services that existed in 1900, but the problem is that so many important goods and services did not exist, that one would be crazy to accept such bargain.
MY TAKE ON IT:
These book’s inventions are interesting and important in their impact, but I’d like to point out that we are just at the beginning of the process and the most important part is restructuring of society. We are still moving from industrial type of society where real ownership of property is limited to very small number of people and majority had to make living by selling their labor. This method of society organization is becoming increasingly unsustainable because there is less and less need in productive labor either for goods or services. The current method of handling it by providing miserable level of subsistence to less educated and much better level of bureaucratic sinecures to more educated part of population would not cut it because all three groups: productive people, welfare poor, and bureaucrats are bound to be psychologically miserable: the first group because being robbed and the other two because of the lack of agency, which is necessary for human high quality of live. That’s why I think that a huge wave of societal inventions is coming with technological inventions being just a relatively unimportant supplement.