Steve Lohr in the New York Times reports R&D budgets increased for 900 of the United States’ 1,000 largest corporate spenders on research and development.
What stands out is how patent applications rise during economic downturns with an increase of 25% in the 1929-32 period. Steve goes on to point out;
The Depression years yielded fundamental advances in technologies of the future like television, nylon, neoprene, photocopying and electric razors, according to the Thomson Reuters analysis.
A similar trend is true around later, far shorter recessions, when basic work on personal computing and later Internet-related technologies were done.
In this respect, economic downturns are necessary as they clear out the old, inefficient industries and allow new ideas and businesses to take hold.
While governments had to do something to avoid a massive depression when the capital and trade market froze in late 2008, is the propping up of debt laden industries like banks, housing companies and auto manufacturers going to act as roadblock to new ideas and businesses?
Just a thought.
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