International -- Readers Report
Argentina Must Think Hard About Technological Change (int'l edition)
In "The unfinished revolution" (Cover Story, Aug. 16), reporters Ian Katz and Beth Rubinstein Keaveny conclude that Argentina needs a second wave of structural changes (labor reform, tax overhaul, anticorruption campaign).
Can we be sure that these measures will make the economies of Argentina (and other Latin American countries) more competitive? I do not think so.
There is a causal relationship between industrial structure and R&D intensity. Technological process innovation is labor-saving, so it assures cumulative and irreversible unemployment. In contrast, product innovation (nanorobots, hard- and software, microelectronics, pharmaceuticals, etc.) go hand in hand with growth and more jobs. This difference is extremely important for macroeconomics consequences. Our "emergent" countries are trapped in technological trajectories with strong job-destroying effects, and this tendency is not corrected by markets. In other words, we do not have "market failures," we have "knowledge failures."
Julio C. Barandiaran
ArgentinaReturn to top
21st Century Ideas: The Good, the Dangerous, the Unmentioned (int'l edition)
I must congratulate your team and thank you for the 21st century report. While it is difficult to predict the future, understanding trends can reduce the uncertainties within it. By understanding trends, we are in effect enabling ourselves to make better predictions about the future. More important, however, understanding trends will help you to broaden your horizons.
There are many examples of leaders throughout history who did not respect obvious trends that were changing their business. Henry Ford, for example, started the trend of the affordable automobile but ferociously ignored many resulting trends that would vastly alter the industry he created. The famous saying that customers could have any color, as long as it was black, is a perfect example of his nearsightedness.
Once, Ford's engineers got together to secretly build an improved Model T. The car contained many technological advancements and could have posed a serious threat to competitors had it been built. When the concept car was presented to Ford, it enraged him and he commenced tearing it apart with his own hands! He failed to see competition coming, which would build better cars with more technological innovations. As a result of his lack of vision, Ford lost market share as quickly as he had gained it. Soon after, Ford lost its rank as the top U.S. auto maker.
It is vital for business decision makers to have access to trend information from inside and outside their field of business. First, they need to plan effective business strategies that take into account outside influences and changes in the business world. More importantly, however, they must be able to see new opportunities, create products, and move into markets which would have otherwise been invisible.
Michael Ozzie Zehner
FrankfurtReturn to top
Gun Ownership Is Rising in Slovakia, Too (int'l edition)
I have read your article about gun control ("Say yes to serious gun control," Editorials, Aug. 16). I'm a BUSINESS WEEK subscriber. I admire America for its free market, economic results, and the strength of the dollar, but it's terrifying to read about gun massacres there. Here in Slovakia, this is the 10th year of democracy after the fall of communism--we also have unemployment and a weak economy. And we have a climbing ratio of gun ownership here, as well. Many companies are now selling their products through the Net.
SlovakiaReturn to top