Science, Scientific Institutions, and Economic Progress
19 Pages Posted: 4 Nov 2010
Date Written: November 3, 2010
The premise of this paper is that economic progress is made possible through discoveries, learning, and creation of skills or knowledge, rather than by accumulation of capital. It is argued that science is a systematic inquiry that is categorically different from pre-scientific stage of useful knowledge or technical know-how. Useful knowledge, which we will call skills in this paper, acquired in the pre-scientific stage was meager and lacked cumulative progress. Progress in knowledge became possible only after the process of skill transmission became institutionalized as science. Science as a social institution allows specialists who interact regularly and could benefit from cumulative process. This observation will be examined in the context of Adam Smith’s theory of economics progress; that specialization and the division of labor is limited by the extent of the market. The implications of the interaction between technology and preferences/behavior are examined.
Keywords: pre-science, scientific institution, economic progress, forgetting-by-not-doing, demography
JEL Classification: H41, O12, O30
Suggested Citation: Suggested Citation