Adam Smith’s Innovation by Division of Labor

Daniel Kahneman in Thinking, Fast and Slow describes what he calls “What You See Is All There Is”:

The combination of a coherence-seeking System 1 with a lazy System 2 implies that System 2 will endorse many intuitive beliefs, which closely reflect the impressions generated by System 1. Of course, System 2 also is capable of a more systematic and careful approach to evidence, and of following a list of boxes that must be checked before making a decision–think of buying a home, when you deliberately seek information that you don’t have. However, System 1 is expected to influence even the more careful decisions. Its input never ceases.

Here, System 1 is our “always on, jump to a conclusion, take the most available pattern” cognitive system, and System 2 is our “lazy, rule-capable, analytical” sense that works at a low level much of the time until called upon to gear up for actual work, either to support System 1’s leaping happiness or to challenge System 1 with reason, evidence, and stuff that matters, but lies outside System 1’s ken.

Jumping to conclusions on the basis of limited evidence is so important to an understanding of intuitive thinking . . . that I will use a cumbersome abbreviation for it: WSYIATI, which stands for what you see is all there is. System 1 is radically insensitive to both the quality and the quantity of the information that gives rise to impressions and intuitions. (86)

In innovation policy, it seems that many writers play on WSYIATI and many policy makers, especially at universities, appear susceptible to WYSIATI, if not pleasantly happy for everything to be presented so intuitively, so that making money from patents is a clear process from disclosure to marketing to money rolling in from licenses. Yes, that’s easy to comprehend–and so policy is written to “make it so.”

One of the foundations of WSYIATI writing on innovation is that innovation starts with inventions made in basic research conducted by university faculty. From there, it is a matter of lots and lots of money to “de-risk” “early-stage” inventions so that they may attract private “investment” as a near sure-thing, making money for everyone while providing a beneficial product to the market to the delight and satisfaction of consumers and government policy makers. No question it is a seductively wonderful account, often presented as if there is no alternative:  WYSIATI.

Consider, then, the following from Adam Smith’s Wealth of Nations (clipped from my free Kindle edition):

Men are much more likely to discover easier and readier methods of attaining any object, when the whole attention of their minds is directed towards that single object, than when it is dissipated among a great variety of things. But, in consequence of the division of labour, the whole of every man’s attention comes naturally to be directed towards some one very simple object. . . .

A great part of the machines made use of in those manufactures in which labour is most subdivided, were originally the invention of common workmen, who, being each of them employed in some very simple operation, naturally turned their thoughts towards finding out easier and readier methods of performing it. Whoever has been much accustomed to visit such manufactures, must frequently have been shewn very pretty machines, which were the inventions of such workmen, in order to facilitate and quicken their own particular part of the work. (4)

This is a point made as well by Matt Ridley in The Rational Optimist–that innovation in the industrial revolution was often the result of common folks working at a speciality with the freedom to try new things. Science straggled along later, basic science much later. Richard White, in Railroaded, gives a similar account of how locomotives were customized by master engineers, so much so that a train crew stayed with their engine, because they knew best how to deal with all its innovative features. A similar point is made by Vannever Bush in Modern Arms and Free Men: it was the gadgeteers, industry scientists, and academics when mixed together on a specific goal that created new things–things such as the digital computer, as George Dyson chronicles so well in Turing’s Cathedral.

So here is another account of technological innovation–from discovery to new product–that takes place largely without basic science, without much applied science, or where there is applied science, has to figure it out as it goes, or just after it goes. This account also takes place outside of the university–or if in a university, not necessarily the part of it that is “conducting basic research.” It takes place in the shop, the workplace, at the point of engagement of people and phenomenon. It is a kind of soulcraft, a zen of motorcycle maintenance, a pattern recognition, a field-based form of innovation that queries the possible, and the adjacent possible, by making things, and varying the making, and observing nuance, which may turn out to be central.

For Smith, this account of innovation starts with division of labor, moves to workmen operating and observing their equipment, and proceeds to a freedom to vary their work and equipment to try new things. Tinkerers, as Ridley calls them. Gadgeteers for Bush. The kids who build radios and mess with car engines, or today write code and make 3d printers. The point is not that these folks are wasting time and what needs to really happen is for some deep pocket investors to make a 3d printer once-for-all that will put all the amateurs out of business and show the world how to clean up a market. Actually, the point is, that this sort of WYSIATI reasoning is faulty: it may well not be possible to build such a wonderful product, the MakerBot Replicator 2 notwithstanding, until the gadgeteers, tinkerers, workmen have pushed the variations around and tried different things. This is what, for instance, Karl Paul Link and his students went about finding what turned out to be warfarin–by first messing around with a hundred variations on compounds that had similar but not quite the same properties. The basic science about how these compounds actually work in a human system came decades later.

So what to make of all this? Perhaps rather than calling for more federal money to pay university administrators to put on a bigger and more elaborate show of owning all faculty work for the purpose of trying to make money from someone, anyone, maybe policy folks should be talking about division of labor, about the dignity of work, and about providing access for machinists and programmers to shops and co-working spaces where they can mess around. Maybe that’s more basic to basic research than the expensive, processified, actuary-dominated version of innovation that passes for the university “basic research grant.”

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