Shorting the Future: Capital Markets and the Launch of the British Electrical Industry, 1880-1892

Drawing on a comprehensive data set consisting of dividend payments, security prices, and stock exchange disclosures, this paper argues that, contrary to common interpretation, potentially damaging government regulations imposed in 1882 cannot explain the retarded development of the nascent British electrical industry in its first decade. Instead, as informed opinion at the time maintained, wildly inflated expectations had by the spring of 1882 driven the publicly-traded security prices of putative electrical enterprises to manifestly unsustainable levels. When initial demand and operating profits failed to meet these grossly extravagant expectations, �irrational exuberance� quickly turned to equally undisciplined pessimism in a classic case of stock market boom and bust - with predictable consequences, most notably a collapse of subsequent investment and development at a time of great technological ferment, when durable early-mover advantages were being established among electrical manufacturers globally. This debilitating sequence of market boom and bust was further exacerbated by the fact that during the brief boom surprisingly little money was invested in the promising technologies that were available. Technological rather than regulatory risk was the dominant factor in the 1882 electrical debacle, with long lasting consequences.

Shorting the Future: Capital Markets and the Launch of the British Electrical Industry, 1880-1892

Drawing on a comprehensive data set consisting of dividend payments, security prices, and stock exchange disclosures, this paper argues that, contrary to common interpretation, potentially damaging government regulations imposed in 1882 cannot explain the retarded development of the nascent British electrical industry in its first decade. Instead, as informed opinion at the time maintained, wildly inflated expectations had by the spring of 1882 driven the publicly-traded security prices of putative electrical enterprises to manifestly unsustainable levels. When initial demand and operating profits failed to meet these grossly extravagant expectations, ?irrational exuberance? quickly turned to equally undisciplined pessimism in a classic case of stock market boom and bust - with predictable consequences, most notably a collapse of subsequent investment and development at a time of great technological ferment, when durable early-mover advantages were being established among electrical manufacturers globally. This debilitating sequence of market boom and bust was further exacerbated by the fact that during the brief boom surprisingly little money was invested in the promising technologies that were available. Technological rather than regulatory risk was the dominant factor in the 1882 electrical debacle, with long lasting consequences

Risk across design domains

Design processes involve risk: to life and limb if the product is unsafe, to the financial health of the company if the product is late, unsuccessful or simply the wrong product, as well as to the emotions and careers of the designers. Many of the risks are shared universally by all designers, but each different industry and each different project faces its own spectrum of serious and minor risks. Different industries have put their methodological effort into finding ways to mitigate the risks they recognise as important. As part of the Across Design project exploring similarities and differences between design processes in different industries, this paper examines how risks are perceived and handled in different types of design process, and proposes that designers and managers can usefully look to other industries for ways to handle risks that are more central for those other industries

The 'new economy' : background, historical perspective, questions, and speculations

In a presentation at the Federal Reserve Bank of Kansas City’s 2001 symposium, “Economic Policy for the Information Economy,” Professor J. Bradford DeLong of the University of California-Berkeley, and Harvard President Lawrence H. Summers suggested that any attempt to analyze the meaning and importance of the "new economy" must grapple with four questions:> First, in the long run, how important will ongoing technological revolutions in data processing and data communications turn out to be? Second, what does the crash of the Nasdaq tell us about the future of the new economy? Third, how should government regulation of the economy change so as to maximize the benefits we reap from these ongoing technological revolutions? And fourth, how will the American economy respond to the shock to public confidence and the destruction caused by the terror attacks of September 11?> In exploring answers to these questions, the authors found the following: The long-run economic impact of the ongoing technological revolutions in data processing and data communications will be very large indeed. The crash of the Nasdaq tells us next to nothing about the dimensions of the economic transformation that we are undergoing. It does, however, tell us that the new economy is more likely to be a source of downward pressure on margins than of large durable quasi-rents. The principal effects of the "new economy" are more likely to be "microeconomic" than "macroeconomic," and they will lead to profound—if at present unclear—changes in how the government should act to provide the property rights, institutional frameworks, and "rules of the game" that underpin the market economy. And finally, the events of September 11 will slow private investment in new technologies, but U.S. military spending is likely to increase, and the increase in military spending will be concentrated on high-technology data-processing and data-communications products. On balance, therefore, the changes in economic structure that fall under the category “new economy” are not likely to be much affected.

Cognitive & Relational Distance in Alliance Networks: Evidence on the Knowledge Value Chain in the European ICT Sector

This paper deals with the firms’ motives for entering into knowledge partnerships. We start by showing that networking strategies are designed to access external knowledge whilst maintaining at the same time a sufficient level of knowledge appropriation and tradability. The ICT sector (and interplaying ones) is particularly concerned by this accessibility/appropriation trade-off. The questions of modularity, complementarity, compatibility and standardisation are critical in the formation of corporate strategic and technological partnerships. Considering that knowledge in this sector is complex and systemic, we construct a theoretical typology of knowledge partnerships by crossing the levels of cognitive and relational proximity with the knowledge phases of exploration, examination and exploitation. This typology is then tested on empirical data through the use of a classification algorithm. The dataset is based on a sample of strategic alliances in the European ICT sector extracted from SDC Platinum. We show that strategic alliances are clustered in relation to the knowledge phases (exploration, examination, exploitation), and that the alliance categories are characterised by levels of relational and cognitive distance which actually are in keeping with the theoretical predictions.knowledge networks; knowledge phases; proximities; strategic alliances; ICT sector

Credit Where It’s Due: The Law and Norms of Attribution

The reputation we develop by receiving credit for the work we do proves to the world the nature of our human capital. If professional reputation were property, it would be the most valuable property that most people own because much human capital is difficult to measure. Although attribution is ubiquitous and important, it is largely unregulated by law. In the absence of law, economic sectors that value attribution have devised non-property regimes founded on social norms to acknowledge and reward employee effort and to attribute responsibility for the success or failure of products and projects. Extant contract-based and norms-based attribution regimes fail optimally to protect attribution interests. This article proposes a new approach to employment contracts designed to shore up the desirable characteristics of existing norms-based attribution systems while allowing legal intervention in cases of market failure. The right to public attribution would be waivable upon proof of a procedurally fair negotiation. The right to attribution necessary to build human capital, however, would be inalienable. Unlike an intellectual property right, attribution rights would not be enforced by restricting access to the misattributed work itself; the only remedy would be for the lost value of human capital. The variation in attribution norms that currently exists in different workplace cultures can and should be preserved through the proposed contract approach. The proposal strikes an appropriate balance between expansive and narrow legal protections for workplace knowledge and, in that respect, addresses one of the most vexing current debates at the intersection of intellectual property and employment law

Robotics and Design: An Interdisciplinary Crash Course

The authors designed and ran a crash course on emotional robotics involving students from both the Information Engineering School and the Design School of Politecnico di Milano , Milan, Italy. The course consisted of two intensive days of short introductory lessons and lab activity, done in interdisciplinary groups and supported by a well-equipped prototyping and modeling lab. People from very different backgrounds had to work efficiently together, going from problem setting through the demonstration of the physical implementation of an object able to show four different emotional states. Both teacher evaluation and questionnaire-based feedback from the students show that it was successful and useful to set up this type of intensive experience in which students share their abilities to achieve a common goal. Key aspects for the success of the course were the short time the students had to reach a well-defined, yet general, goal, the students' ability to find efficient ways of cooperating and sharing their competences, students' motivation to arrive at a working prototype, and the strong support from teachers and lab personnel

Three Types of Scientific Writing

A winner of the James F. Slevin Assignment Sequence Prize, this sequence originates from Theoretical and Applied Mechanics 175, Writing About Engineering Problems. The sequence of three assignments introduces students to scientific writing in several genre. For the first essay, "How Things Work," students select an everyday object and describe how it works in the form of a popular science article. For the second essay, ''Climate Change,'' students develop the skill of data analysis in order to build an argument. For the third essay, ''Engineering in Sports,'' students write a patent-like description of a technology designed to improve athletic performance. Preparatory writing and in-class activities include small group peer review, oral presentations, and study of style and language. 10 page pd