strict upper limits on the economical pace of advance (Nathan Rosenberg)

 
 • “Even under the most favorable conditions for advancing the scale frontier the cost side of the equation imposes fairly strict upper limits on the economical pace of advance, and trying to force the pace could mean sharply rising cost of development. The experience required for pushing out the scale frontier is related to time and cannot be acquired by increasing the number of similar new units.  Perhaps the greatest uncertainties connected with units arise from problems that may not show up until the units have been in operation a few years.  For the industry as a whole, the socially optimal number of pioneering units during the first two or three years of any major advance in scale, design, or steam conditions is probably rather small, most often ranging from perhaps two or three or half a dozen [a dozen is 12, half a dozen is 6]” (William Hughes, “Scale frontiers in electric power”, in William Capron [ed.], Technological change in regulated industries [The brooking institution, washington, d.c., 1971], p.52).

Nathan Rosenberg, Inside the black box: technology and economics, 1982

p.14
the distinction between inventive activity that is directed toward product improvement or entails the invention of a new product, and inventive activity that is cost-reducing ── or process invention. 

p.108
   In their earliest stages, innovations are often highly imperfect and are known to be so.  Innumerable “bugs” may need to be worked out.8  
   8  This term should be taken to include a great many production problems involving the use of new equipment that become apparent only as a result of extensive use ─ for example, metal fatigue in aeroplanes.  William Hughes has made this point well with respect to exploration of the scale frontier in electric power generation:  “Even under the most favorable conditions for advancing the scale frontier the cost side of the equation imposes fairly strict upper limits on the economical pace of advance, and trying to force the pace could mean sharply rising cost of development. The experience required for pushing out the scale frontier is related to time and cannot be acquired by increasing the number of similar new units.  Perhaps the greatest uncertainties connected with units arise from problems that may not show up until the units have been in operation a few years.  For the industry as a whole, the socially optimal number of pioneering units during the first two or three years of any major advance in scale, design, or steam conditions is probably rather small, most often ranging from perhaps two or three or half a dozen [6]” (William Hughes, “Scale frontiers in electric power”, in William Capron [ed.], Technological change in regulated industries [The brooking institution, washington, d.c., 1971], p.52).  One of the other virtues of the Hughes article is its forceful reminder of the intimate link that often exists between technological progress and economies of scale.  “The realization of latent scale economies is an especially important form of technological progress in the utility industries” (ibid.,p.45).

  (Inside the black box./ Nathan Rosenberg, 1. technological innovations., 2. technology─social aspects., HC79.T4R673   1982, 338'.06, first published 1982, )
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