0.2 21st century economic development  (Page 6/13)

There is good reason why they should. It was only during the third wave, in the early part of the 20th century, that governments and companies began to search for new technologies in a systematic manner. One of the oldest, Bell Laboratories at Murray Hill in New Jersey, was founded in 1925. Rather than leave the emergence of “new-wave” technologies to chance, all the major industrial countries nowadays have armies of skilled R&D workers sifting the data in pursuit of blockbuster technologies capable of carving out wholly new markets. The tools they use - computer analysers, gene sequencers, text parsers, patent searchers, citation mappers - are getting better all the time, speeding up the process. The productivity of industrial laboratories today is twice what it was a couple of decades ago (McDaniel, 2005).

So the fifth industrial revolution that started in America in the late 1980s may last no more than 25-30 years. If, as seems likely, we are already a decade into this new industrial cycle, it may now be almost too late for the dilatory to catch up. The rapid-upswing part of the cycle - in which successful participants enjoy fat margins, set standards, kill off weaker rivals and establish themselves as main players - looks as though it has already run two-thirds of its course, with only another five or six years left to go. Catching the wave at this late stage will depend on governments' willingness to free up their technical and financial resources, invest in the infrastructure required and let their fourth-wave relics go (The Economist, 1999). Failing that, latecomers can expect only crumbs from the table before the party comes to an end - and a new wave of technologies begins, once again, to wash everything aside ( [link] and [link] ).

The knowledge that is created in the market allows for the cycles to shorten, this is not done in isolation there are other factors such as government and policy that aid or impede the shortening of these cycles.

In the Juglar cycle, that is often called the business cycle, recovery and prosperity are associated with increases in productivity, consumer confidence, aggregate demand and price. In the cycles before World War II or that of the late 1990’s in the United States, the growth periods usually ended with the failure speculative investments built on a bubble of confidence that bursts or deflates. In these cycles, the periods of contraction and stagnation reflect a purging of unsuccessful enterprises as resources are transferred by market forces from less productive uses to more productive uses. Cycles between 1945 and 1990’s in the United States were generally more restrained and followed political factors, such as fiscal policy, and monetary policy.

If one lays the idea of knowledge over this cycle; as the growth period ended and the failures occurred the knowledge of those people involved in the cycle and enterprises utilise knowledge of lessons learned before into the new emerging cycle to create value and opportunities in new cross over emerging technologies and enterprises ( [link] ).