The Venturesome Economy:

How Innovation Sustains Prosperity in a More Connected World

Princeton University Press  (Nov 2008)

Supported by a generous grant from the Kauffman Foundation

 

“Best of 2008” lists of The Economist, BusinessWeek and Barrons

 

Winner of 2008 PROSE Award for Professional and Scholarly Excellence in Business, Finance, and Management, Association of American Publishers

 

Slides (from book talk)

 

Concluding Chapter

 

FAQs

 

Excerpts:

 

McKinsey Quarterly

Journal of Applied Corporate Finance (1)

Journal of Applied Corporate Finance (2)

The American

   Selected Press (More Below)

 

·        New York TimesSteve Lohr column and Milan Fashion Review (!!!)

·        EconomistLead business article Nov 22 08

·        NewYorker May 16 2011

·        Economist podcast

·        Financial Times – John Kay column and book review

·        Inc. Magazine Interview

·        BusinessWeek Maria Bartiromo interview

·        Politico Amity Shlaes best book

·        Reuters interview (video link)

 

Blurbs (More Below):

 

Lawrence Summers, Harvard University, Former Secretary of the US Treasury:

“…Bhidé provides a fresh and reassuring perspective on America’s technological position in an increasingly global economy. Anyone interested in our economic future and especially our technology policies should read this book.”

 

Edmund Phelps, 2006 Nobel Laureate in Economics

“..Bhidé draws on his unmatched knowledge of the mechanisms of innovation to show the benefits to us of Asia’s advances and the errors in the techno-fetishism that grips Washington officialdom. This book deepens radically our understanding of how the global economy functions."

 

Tom Peters

If I were asked to recommend to the next president just one book on the trajectory of the U.S economy in the next several years, it would unhesitatingly be Amar Bhide's The Venturesome Economy… an utterly original interpretation of the nature of the complex process of innovation

 

 

Press reviews comments, and Articles:

Economist, 22 Nov 2008

..companion  Economist podcast

Nature Jan 2009 review

New York Times – Steve Lohr column

NYT- article on Milan Fashion Show

New York Post (Oct 5 08) book review

Financial Times John Kay column

BusinessWeek best Innovation books 2008

Barrons Gene Epstein’s Seven to Savor list of holiday books

Maria Bartiromo interview

Bad times, good inventions (NYT)

WSJ op-ed: Venturesome Consumption in a Crisis

Financial Times book review

EconTalk podcast

VOX interview and podcast

Economist’s review of antecedent article

Pete Boettke, Austrian Economists (Oct 10 08)

Sydney Morning Herald

Reuters Dec 2 interview

Yale Global Interview

HBS Working Knowledge

Inc. Magazine Interview

Young Guns: Foxbusines

…companion  Young Guns video

Die Zeit interview (German)

New Yorker: May 16, 2011

 

Table of Contents

Preface and Introduction 

Book 1. Cautious Voyagers: Why VC-Backed Businesses Still Favor Home


1. VCs in New Ventureland

2. Advancing the Frontier: The Nature of Mid-level Innovation

3. Marketing: Edging into International Arenas

4. Offshoring: The Ins and Outs

5. Founders and Staff: Global at Home

6. On Methods and Models

 

Book 2: Embrace or Resist?

 

7. Alarmist Arguments

8. The Reassuring Realities of Modern Cross-Border Flows

9. Valuable Differences

10. Serving the Service Economy

11. Venturesome Consumption

12. Winning by Using

13. Non-Destructive Creation

14. Immigrants: Uppers or Downers

15. The Elusive Underpinnings

16. First Do No Harm

Flap Copy

Many warn that the next stage of globalization—the offshoring of research and development to China and India—threatens the foundations of Western prosperity. But in The Venturesome Economy, acclaimed business and economics scholar Amar Bhidé shows how wrong the doomsayers are.

Using extensive field studies on venture-capital-backed businesses to examine how technology really advances in modern economies, Bhidé explains why know-how developed abroad enhances—not diminishes—prosperity at home, and why trying to maintain the U.S. lead by subsidizing more research or training more scientists will do more harm than good.

When breakthrough ideas know no borders, a nation’s capacity to exploit cutting-edge research regardless of where it originates is crucial: our venturesome consumption—the willingness and ability of our businesses and consumers to effectively use products and technologies derived from scientific research—is far more important than our share of such research. In fact, a venturesome economy benefits from an increase in research produced abroad: the success of Apple’s iPod, for instance, owes much to technologies developed in Asia and Europe.

Many players—entrepreneurs, managers, financiers, salesmen, consumers, and not just a few brilliant scientists and engineers—have kept the U.S. at the forefront of the innovation game. As long as their venturesome spirit remains alive and well we need not fear advances abroad. Read The Venturesome Economy and learn why—and see how we can keep it that way.

 

 

FAQs (Everything you always wanted to know about The Venturesome Economy, but it might not have occurred to you to ask..):

Q: Another book on globalization and the rise of China and India??

 

A: A new perspective on how the U.S (and other innovative Western economies) stand to gain:

 

¶ Shows how innovators in the U.S. harness research produced abroad to improve the productivity of purely domestic activities (such as retailing) which account for well over half of U.S. employment ; in contrast, advocates of globalization often emphasize opportunities for high-tech exports.

 

¶ Critiques the seemingly benign techno-nationalist prescription (of increasing spending on research and training more scientists and engineers) rather than the protectionist response to globalization.  Technological progress, I argue, inevitably requires a broadening of the role of government – cyberspace encourages cyber-crime and requires cyber-cops.  But misguided interventions proposed by techno-nationalists can lead to the neglect of the real issues raised by globalization (such as the increase in the world’s consumption of fossil fuels and a mis-regulated financial system).

 

Q: What’s different about the method?

 

A: As in a common law trial, I pull together a broad body of evidence, expert testimony and precedent to assess the concrete, current realities:

 

¶ This is not your grandfather’s – much less Adam Smith’s pre-Industrial Revolution economy.

 

¶ The new realities can no more be captured in a few sound bites than can how a car works; and, without an appreciation of how the engine, transmission, brakes, suspension, etc. of the modern economy operate, efforts to maintain or improve it can do more harm than good.

 

¶ My book embraces complexity, incorporating many important features of the modern economy (and what Galbraith might have called its technostructure) that are often abstracted away by economic theorists and media gurus:  These features include the:

Many complementary activities necessary to develop and effectively deploy technological innovations.  Scientific discoveries made in research labs, context specific know-how developed by users and even the marketing practices used to sell new products are all crucial. 

Differences in the cross border mobility of different kinds of innovations. Scientific discoveries travel across national borders much more easily than context specific know-how and marketing practices.

Low share of the value of innovations captured by their developers vis-à-vis their users.

The growth of the domestically produced and consumed services – that at least partially offsets the more intensive trading of tradable goods.

The role of venturesome consumption in the development and effective use of innovations.

How non-destructive creation offsets job-losses due to efficiency improvements (creative destruction) and offshoring and thus sustains increasing employment, especially in the non-traded service sector.

 

The slides from my book talks (which you may download for your personal use) provide more detail about the modern system, but really, you should read the whole book! (available  at Amazon, Barnes and Noble, Borders, and your fine neighborhood independent book store).

 

 

Advance comments:

"If I were asked to recommend to the next president just one book on the trajectory of the U.S economy in the next several years, it would unhesitatingly be Amar Bhide's The Venturesome Economy. The book is an utterly original interpretation of the nature of the complex process of innovation. Among other things, it makes a mockery of the simplistic, alarmist writings that have become so popular in these troublesome economic times.  As a student myself of the lovely, kinky history of real innovation, I almost found myself audibly cheering as I raced through this seminal text."

Tom Peters, co-author of In Search of Excellence and numerous other influential books

“Amar Bhidé provides a fresh and reassuring perspective on America’s technological position in an increasingly global economy. Anyone interested in our economic future and especially our technology policies should read this book.”

Lawrence Summers, Harvard University, Former Secretary of the U.S. Treasury

 
"The strides made by China and India, notably their unexpected technological advances, have made America anxious, prompting calls to double federal spending on basic research. In The Venturesome Economy, Amar Bhidé draws on his unmatched knowledge of the mechanisms of innovation to show the benefits to us of Asia’s advances and the errors in the techno-fetishism that grips Washington officialdom. This book deepens radically our understanding of how the global economy functions."

Edmund Phelps, 2006 Nobel Laureate in Economics

 

 “In The Venturesome Economy, Amar Bhidé takes on the increasingly noisy chorus of critics worried about the effects of globalization on the national economy. He demonstrates that the application and commercialization of technology is far more important than whether the underlying science originated at home or abroad. The winners will be those countries and businesses that have the insight and energy to apply innovations effectively. This is an optimistic and important message.”

Donald J. Gogel, president and CEO of Clayton, Dubilier & Rice

 
"A book full of solid if unconventional deductions, all based on extensive observations. Amar Bhidé is an author who knows whereof he speaks and to whom one should listen.”

William J. Baumol, author of "The Free-Market Innovation Machine" 

 

 

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