Levine also notes that the result of the government patchwork of funding is that private firms jump into the technological progress market, with even worse economic results. "Private firms focus their research efforts according to short-term, market-driven priorities, motives which often contradict long-term sustainable development and economic growth" (Levine 1998 675). Result=inequality/scarcity.
Further, Levine (1998 675) notes that large academic institutions that are more likely to consider long-term concerns are put in the position of directing national innovation systems; please see above for the problems inherent in that (turf wars).
Despite all that, Levine does still believe technological progress is the answer to scarcity, at least in environmental arenas. Levine notes that "As far back as 1911, Joseph A. Schumpeter integrated innovation into economic development theory by showing a positive correlation between involvement in a commercial transaction and the generation of new products, devices or systems" (1998 675). But in the past decade, science and technology research have been threatened, rather than supported (Levine 1998 675), making it doubly difficult to posit that technological progress can realistically overcome scarcity; technological innovation work itself suffers from scarcity caused by the vagaries of politics and corporate interests.
The next problem with technology solving problems of scarcity lies in the concept of competitive advantage. Kaounides (1999 53+) hypothesized that:
National systems of innovation that possess world-class science and technology infrastructure and institutions engaged in frontier research will, first, play an increasingly important role in contributing sources of competitive advantage to domestic agglomerations of industries and firms, and, second, act as a magnet attracting inward flows of foreign direct investment and R& D. facilities, which, together with parallel international alliances of domestic institutions, would enhance the generation of research externalities, local spillover effects, and economy-wide increasing returns for networks of interrelated firms and industries in the domestic economy, thereby reinforcing their role in competitive advantage.
Kaounides (1999 53+) found, however, that there was no easy straight-line progression involved. Recent research "points to far more complex interactions than the linear view suggests ... not only do science and technology interact in a complex two-way process, but basic research and government institutions (e.g., advanced measurement and testing facilities and technologies) can play an important role" in making the technologies available in the sectors of the economy in which they would have the most desirable effects.
Kaounides (199 53+) concluded that there was an increasingly vital role for government to play in support for both fundamental and directed research, and in promoting networks of alliance between business and academia. The key management task, Kaounides decided, involved organizing R& D. And innovation process so that it would benefit companies in a competitive fashion (1999 53+); competition by its nature breeds scarcity as one company attempts to disenfranchise its competitors in some way. Scarcity on some level follows any competitive loss, whether it is scarcity of good movie roles for losing the Oscar or scarcity of a job and food because the computer company one works for is bested in the marketplace; all scarcity is relative.
Everything to date is simply a reflection, in one pocket of the economy or another, of Clark's contentions regarding the social creation of scarcity. This hypothesis is operative, moreover, in times of great technological progress, or little. Indeed, it one wants to follow his line of reasoning to Adam Smith, it is unassailable. "Adam Smith saw wealth in terms of the material prosperity of the society as a whole. The primary cause of poverty in Adam Smith's economics is an insufficient production of real wealth, which he defined as 'the annual produce of the land and labour of the society' " (quoted by Clark 2002 415+). As technological progress removes the produce of the land and labour from the purview of more and more citizens, it would stand the test of logic that fewer and fewer citizens would be participating in Smith's version of abundance, and would therefore experience scarcity. Smith was an idealist in many ways. He proposed that: "No society can surely be flourishing and happy, of which the far greater part of the members are poor and miserable. It is but equity, besides, that they who feed, cloath and lodge the whole body of the people, should have a share of the produce of their own labour as to be themselves tolerably well fed, cloathed and lodged" (quoted by Clark 2002 415+).
But he was realist enough to see the "damaging effect" various forms of economic competition, not to mention hoarding, had on the public's morals, and therefore on the distribution of wealth and experience of scarcity. Clark noted that while mankind as a whole might become richer whether by technological advancement or some other means, "does not, of necessity, involve an increase in human welfare" (Clark 2002 415+). In short, he was proposing and artificial scarcity crated by the business system "in order to maintain the rate of return on wealth and the social power that attaches to 'scarce' wealth" (Clark 2002 415+). (NOTE: Wealth is scarce because if it were not, it would be like pebbles on the beach and no one would want it, in a very simplified analogy of Keynes' thoughts on that subject.)
A real-life example of how scarcity is produced in order to also produce wealth, despite technological advancement, can be found in the Yorkshire Drought of 1995. That year, rainfall was scanty in England, but Bakker contends that the scarcity was the result of technological progress, in this case in the guise of privatization of the water supply. While the technologies existed to better manage the water and reduce or eliminate scarcity, the company that had the franchise had not wanted to make the capital expenditures needed. By maintaining the drought, however, and raising fees, the company "remained in good financial health during and after the drought (which is) is entirely consistent with the postprivatization regulatory framework" (2000 4). This in turn supports the earlier contention that politicization of commodities, despite or even because of technological advancement, allows scarcity to continue or even to expand.
Water, as it happens, is an excellent commodity with which to wash out the idea that technological progress can eliminate scarcity, even when the commodity itself is abundant, and even if political considerations were benign. Dosi and Easter contend that scarcity in water supplies will continue because it is changes in use patterns that is required to eliminate scarcity 2003 265+).
If technological progress were the method by which scarcity is to be eliminated, it would stand to reason that South Asia, a current hotbed of technological jobs, would not be on the verge of violence. Some contend that, particularly regarding India, "The stresses of population growth and negative environmental change offer one explanation for the region's deteriorating political and civil climate" (Matthew 2002 235+). Negative environmental change is precipitated, more often than not, by technological advance without expanding those advances to environmental protection as well as technology manufacture.
Kates (1996 43+) traces the ebb and flow of scarcity over the millennia of recorded history, and concludes that population growth has always happened as a result of technological advancement; this put pressures on all systems, economic and otherwise, until a brief period of relatively universal abundance began to result in pockets of scarcity again, both from population growth alone and hoarding and taking. At the end, he concludes that "our science can observe but not readily explain past and existing interactions of population, technology, and resources" but he assumes that no matter how far technology progresses, it will never be able to maintain the multiple facets of human life in status quo at the level of lack of scarcity for very long.
Bakker, Karen J. "Privatizing Water, Producing Scarcity: The Yorkshire Drought of 1995" Economic Geography 76.1 (2000): 4. Questia. 3 Dec. 2004 .
Caselli, Francesco. 'Technological Revolutions." American Economic Review 89.1 (1999): 78-102.
Clark, Charles M.A. 'Wealth and Poverty: On the Social Creation of Scarcity." Journal of Economic Issues 36.2 (2002): 415+. Questia. 3 Dec. 2004 .
Dosi, Cesare, and K. William Easter. "Market Failure and Role of Markets and Privatization in Alleviating Water Scarcity." International Journal of Public Administration 26.3 (2003): 265+. Questia. 3 Dec. 2004 .
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