Innovation

Category: Fields of research

Innovation refers to the discovery and implementation of a novel idea. Although innovation is mostly associated with technological inventions, new ideas that change the organization of the economy, politics, and society, as well as new cultural patterns, can also be regarded as innovations.

In Stages of Economic Growth: A Non Communist Manifesto (1960), Walt Rostow introduced the idea of stages of economic growth. In the „traditional stage“, or the first stage of growth, where poor countries are, economic institutions, technology, and cultural values do not provide fertile ground for economic development. In underdeveloped countries, traditional culture, social institutions, a weak work ethic, and a lack of entrepreneurial spirit impede economic efficiency. In addition, large families with many dependent members make it difficult to save for investments. Fatalistic values, which emphasize that suffering is a normal part of life and promote acceptance of one's own bad destiny, are another major obstacle to economic development. The government in underdeveloped countries makes it even more difficult to abandon traditional values by controlling wages and prices. In the second stage, which Rostow calls „the preconditions for take-off, “ the process of development begins when the elite start initiating innovations in economic activities.

In The Coming of Post-Industrial Society (1973), Daniel Bell defines post-industrial society as a social formation in which private property, class interest, and class conflict have lost their centrality and priority. The new society is organized around the axis of theoretical knowledge, education, science, and government institutions. Traditional businessmen are being replaced by scientists, economists, and engineers. The source of innovation and the creation of practical policy are universities, and not, as before, business.

Tom Burns and George Macpherson Stalker, in The Management of Innovation (1961), divide organizations into two types: organic and mechanical. Mechanical organizations have a hierarchically organized bureaucracy, with clear vertical channels of tasks, responsibilities, and power. Each individual and each level within the organization does its part autonomously, while major decisions are made only at the top of the hierarchy. Organic organizations have a looser structure, while levels and channels of communication and decision-making are multiple. In these organizations, achieving goals is more important than respecting clearly defined bureaucratic rules. Organic organizations are more suited to companies operating in fields that are characterized by rapid market changes and major technological innovations. On the other hand, mechanical organizations are more suited to traditional and stable industries, which are not greatly affected by market changes.

Saskia Sassen, in The Global City: New York, London, Tokyo (1991) sees global cities as the focal points of the organization of the global economy; they are centers of financial firms and firms specializing in special services; they are innovation production centers in the most profitable industries, and they are large markets for products and innovation. These cities are globally integrated with each other. They have undergone major changes in the structure of economic branches, spatial organization, and social structure. Global cities differ from earlier cities in that the modern economy has a greater need for centralized control and management. These cities are centers of financial and banking innovation and services, marketing, accounting, and legal services, and the largest users of these services are transnational companies. These economic sectors represent the largest source of income and economic power of global cities.

In the book The Theory of Economic Development (1912), Joseph Schumpeter introduces the thesis that the basis of economic development is the actions of entrepreneurs whose main role is to be leaders in introducing innovations. Innovations introduced by entrepreneurs can be very different: new technologies, new goods, new raw materials, new markets, different organization of production, etc. Such entrepreneurial innovations deviate from established ways of producing and doing business, using new methods or an innovative combination of old methods, doing what Schumpeter calls "creative destruction" in order to create a new, better economic system. It distinguishes economic innovations made by entrepreneurs from technological inventions. In that sense, entrepreneurs differ from inventors, capitalists, bankers, managers, landowners, and workers, because only entrepreneurs introduce real innovations into the economy. Although entrepreneurs may, at the same time, have other functions (those mentioned above), they are primarily driven by the desire to innovate and take risks, and not the desire for profit or earnings. Entrepreneurial activities thus represent the basis of capitalism and its development, and in Schumpeter's theory, their activity is crucial for understanding his theories of credit, profit, capital, and economic cycles.

Gabriel Tarde argues that innovations occur in certain social groups and then spread further through social groups, and then to the whole society. If there were no social barriers, innovation would spread quickly and evenly, but in real situations, there are always barriers. The speed and patterns of the spread of innovation depend on these social circumstances. Individuals, themselves, are not able to resist this spread, but fall under the influence of social groups with which they are connected by interactions.

Max Weber, in his very influential book The Protestant Ethics and the Spirit of Capitalism (1920), states that each religion has its own economic ethics and that ethics imply practical incentives to perform a certain type of social action, based on a religious view of the world and life. He argues that Protestant ethics influenced the creation of the capitalist spirit, marked by a positive view of work and the acquisition of material wealth. Emphasis is placed on effort, thrift, discipline, and innovation, while laziness, gaining wealth without work, and hedonistic spending are viewed negatively.

In Diffusion of Innovation (1962), Everett Rogers introduced his theory of the diffusion of innovation. This theory explains the process by which innovation spreads from the moment it is created until the moment it becomes fully accepted. Rogers has researched the processes and contextual factors that influence the speed of adoption or rejection of innovations. He introduced two new categories - early and late adopters. The focus was on the spread of commercial innovation in the modern age, so a lot of attention was paid to the commercialization and advertising of innovations. The center adopts innovations faster than the periphery. Rogers developed a two-step communication theory to explain how information about innovation spreads. At the first level, information about the innovation is created, as well as advertising materials about it. At the second level, people in charge of product promotion go to targeted communities and approach those who are considered potential buyers of innovation. The promoters then offer free product testing to those who are targeted. Finally, these early adopters of innovation influence their acquaintances to adopt the innovation as well. Rogers concluded that the adoption of innovations over time has a standard variation (Bell curve). He singled out five types of technology adopters, in relation to the chronology of innovation acceptance: innovators (2.5%), early adopters (13.5%), early majority (34%), late majority (34%), and laggards (16 %). Rogers later applied his theory of innovation and communication to the areas of family planning, media expansion, and cancer prevention. The fifth edition of Diffusion of Innovation (2003, with Nancy Singer Olaguera) explores how the Internet spread, changes in communication, and the spread of ideas that it has brought.

David Riesman argued that traditional societies, which are organized around family and kinship relations, have very clear rules of social behavior, which must be strictly adhered to; thus, the levels of individuality and innovation are low, and change is rare. Vilfredo Pareto divided the elite into two groups - "speculators" and "rentiers". There is a difference in the way of earning between these two groups. Speculators introduce innovations, as they are constantly trying to find new ways to make money, so their economic success depends on talent, hard work, and cunning. John Stuart Mill argued that political liberties bring innovation, experiments, and new ideas, and thus create new social forms, new forms of domestic life, and new types of economic organization. In American Capitalism (1952), Galbraith argues that a decentralized private economy has led to a huge increase in productivity and innovation. In his book The Functions of Social Conflict (1956), Lewis Coser argues that conflict can be the cause of change in the whole society, and the most important consequences are social innovation and increased centralization of power.

Alfred Kroeber, in Configurations of Culture Growth (1944), employs a historical-comparative approach on a wide scale, analyzing diverse culture areas across the world - China, India, Greece, Islam - and time periods. Kroeber concluded that all of the major civilizations went through the cultural climax, a period of rapid pulse-like growth and innovation, with major advances concentrated within that period.

References:

Apter. The Politics of Modernization (1965);

Bell. The Coming of Post-Industrial Society (1973);

Burns. The Management of Innovation (1961);

Coser. Men of Ideas: A Sociologist’s View (1965);

Crozier. The Stalled Society (1973, in French 1970);

- The Bureaucratic Phenomenon (2017, in French 1963);

Galbraith. American Capitalism: The Concept of Countervailing Power (1952);

Latour. Laboratory Life: The Social Construction of Scientific Facts (1979);

Lenski. Ecological-Evolutionary Theory (2006);

Merton. Science, Technology and Society in Seventeenth-century England (1936);

- On Theoretical Sociology (1967);