4 ms·

Business is much more lucrative than science. Not surprising.

AnthonyMouse 12y ago
It is kind of surprising actually. Scientists create more wealth than managers. If they aren't better compensated it indicates an economic inefficiency that someone could profit by eliminating. There are obviously structural reasons why this hasn't happened or it would have already, but given the amount of money on the table, someone who figured out how to do it would stand to profit immensely.
- lifeisstillgood 12y ago
  That's a great thought. I am assuming that the structural issue is that science in order to create the wealth must "open source" it's knowledge and this be unable to capture private profit, whereas corporations can maintain proprietary control and create less wealth but more profit. If we do solve it however, perhaps through some patent system, we will incur another problem - Albert Einstein for instance (photons, relativity and atomic structure) would be owed about 20% of the entire world GDP ... But yeah, I like the idea.
  - AnthonyMouse 12y ago
    The patent system is actually highly problematic because it a) provides no reward for research leading to negative results (which is extremely important to scientific progress) and b) provides the money after the fact rather than while the research is being conducted, requiring scientists to solicit investors up front (and possibly not be able to find any) and then gives the fruits to investors who may or may not reinvest it into future R&D. Then on top of that the patent monopoly makes the new invention more expensive and discourages third parties from making improvements they can't deploy without permission, which reduces the overall value of the invention. We might actually do better to just throw the patent system away and replace it with massive direct public funding of scientific research. The interesting question then is how to decide what to fund and in what amounts, which seems to be the heart of the problem. And there is also another point, which is that maybe scientists aren't particularly underpaid, maybe it's that managers are overpaid, e.g. because investors in public companies are so diffuse and distant from the companies they're invested in that they can't prevent executives from paying themselves more than they deserve. If you solve that then fewer people will want to go to business school instead of becoming scientists and companies will have the money they're no longer paying managers to potentially invest in R&D.
    - throwawaykf05 12y ago
      >The patent system is actually highly problematic because it a) provides no reward for research leading to negative results (which is extremely important to scientific progress)... And how is that different from absolutely any known system for managing science? You don't get publications for failed results either. FWIW I dedicated a whole quarter of my Master's thesis to a failed approach, just because I also thought it was important for progress, even though it provided little value from a thesis defense perspective >and b) provides the money after the fact rather than while the research is being conducted, requiring scientists to solicit investors up front (and possibly not be able to find any) Again, sounds like how the current proposal-for-grant system we have now. > and then gives the fruits to investors who may or may not reinvest it into future R&D. There really is no way to differentiate this from the alternatives. The government decides to invest based on a budget that is subject to way more conflicting forces than a profit-driven private entity. > Then on top of that the patent monopoly makes the new invention more expensive ... That is a commonly postulated hypothesis, but if one looks at empirical evidence, one finds a great deal of positive impetus to innovation provided by patents... in some industries. As always, the data is messy, the situations are complex, and the hypotheses are simplistic, but a large number of studies show that the patent system has significant benefits as well as costs. However it is impossible to tell from the data which one outweighs the other, mainly because it is like comparing apples and oranges. In general, though, risky, capital intensive fields are benefited more than harmed by patents. >* massive direct public funding of scientific research.* I don't know what you mean by "public", but to me it sounds like "government", in which case, see point above regarding budgets.
      - sokoloff 12y ago
        I read a "negative result" as different from a "failed result". A negative result, which has scientific value but no patent value, would be something like, "We have conclusively shown that blood-letting by leeches is not an effective treatment for fever." A failed result, on the other hand, would read more like "We were unable to conclusively determine one way or the other, but here's the method we used" You could certainly publish the former (back in a time where that wasn't already accepted fact in the scientific/medical community), but it's unclear how you'd apply that to the patent (or even market) realm. You can't patent "stopping doing something".
- refurb 12y ago
  It is kind of surprising actually. Scientists create more wealth than managers. Creation of wealth only plays a role in salaries in the sense that you can't pay someone more than the value created overall. Supply and demand is really what drives salary.
  - AnthonyMouse 12y ago
    Supply and demand sets the price of everything. You're just restating the fact that scientists don't make a lot of money. The interesting question is why there isn't more demand for scientific research when the returns are so high. Clearly it isn't that the market and society have no desire for additional scientific progress.
    - sokoloff 12y ago
      The returns for genuine basic scientific breakthrough can be very high. They also are very rare, and tend to create financial payoff only after a decade or more.
    - eli_gottlieb 12y ago
      Hyperbolic discounting makes decades-scale scientific projects "unwise" from a private firm's point of view: many private firms don't exist in the same form across 40-year time-spans.
- Tycho 12y ago
  Somebody already has. They're called Renaissance Technologies.
- throwawaykf05 12y ago
  >Scientists create more wealth than managers [Citation needed.] While I completely agree that progress in science creates much more value than efficient management, a very small fraction of research efforts actually yields any useful results (as you mention downthread). Abstract value is different from wealth. Even assuming that value translates proportionally into wealth (a huge assumption, considering that commercialization itself of scientific advances is risky and often far into the future), how can you even try to consistently determine the wealth an average scientist creates? This is why science is like the startup game that VCs play. Invest a pittance into people who see promising and hope one of them turns out to be the next Google. Of course, despite the immense wealth a Google creates, all the non-Googles get nothing.

It is kind of surprising actually. Scientists create more wealth than managers. If they aren't better compensated it indicates an economic inefficiency that someone could profit by eliminating. There are obviously structural reasons why this hasn't happened or it would have already, but given the amount of money on the table, someone who figured out how to do it would stand to profit immensely.

lifeisstillgood 12y ago
That's a great thought. I am assuming that the structural issue is that science in order to create the wealth must "open source" it's knowledge and this be unable to capture private profit, whereas corporations can maintain proprietary control and create less wealth but more profit. If we do solve it however, perhaps through some patent system, we will incur another problem - Albert Einstein for instance (photons, relativity and atomic structure) would be owed about 20% of the entire world GDP ... But yeah, I like the idea.
- AnthonyMouse 12y ago
  The patent system is actually highly problematic because it a) provides no reward for research leading to negative results (which is extremely important to scientific progress) and b) provides the money after the fact rather than while the research is being conducted, requiring scientists to solicit investors up front (and possibly not be able to find any) and then gives the fruits to investors who may or may not reinvest it into future R&D. Then on top of that the patent monopoly makes the new invention more expensive and discourages third parties from making improvements they can't deploy without permission, which reduces the overall value of the invention. We might actually do better to just throw the patent system away and replace it with massive direct public funding of scientific research. The interesting question then is how to decide what to fund and in what amounts, which seems to be the heart of the problem. And there is also another point, which is that maybe scientists aren't particularly underpaid, maybe it's that managers are overpaid, e.g. because investors in public companies are so diffuse and distant from the companies they're invested in that they can't prevent executives from paying themselves more than they deserve. If you solve that then fewer people will want to go to business school instead of becoming scientists and companies will have the money they're no longer paying managers to potentially invest in R&D.
  - throwawaykf05 12y ago
    >The patent system is actually highly problematic because it a) provides no reward for research leading to negative results (which is extremely important to scientific progress)... And how is that different from absolutely any known system for managing science? You don't get publications for failed results either. FWIW I dedicated a whole quarter of my Master's thesis to a failed approach, just because I also thought it was important for progress, even though it provided little value from a thesis defense perspective >and b) provides the money after the fact rather than while the research is being conducted, requiring scientists to solicit investors up front (and possibly not be able to find any) Again, sounds like how the current proposal-for-grant system we have now. > and then gives the fruits to investors who may or may not reinvest it into future R&D. There really is no way to differentiate this from the alternatives. The government decides to invest based on a budget that is subject to way more conflicting forces than a profit-driven private entity. > Then on top of that the patent monopoly makes the new invention more expensive ... That is a commonly postulated hypothesis, but if one looks at empirical evidence, one finds a great deal of positive impetus to innovation provided by patents... in some industries. As always, the data is messy, the situations are complex, and the hypotheses are simplistic, but a large number of studies show that the patent system has significant benefits as well as costs. However it is impossible to tell from the data which one outweighs the other, mainly because it is like comparing apples and oranges. In general, though, risky, capital intensive fields are benefited more than harmed by patents. >* massive direct public funding of scientific research.* I don't know what you mean by "public", but to me it sounds like "government", in which case, see point above regarding budgets.
    - sokoloff 12y ago
      I read a "negative result" as different from a "failed result". A negative result, which has scientific value but no patent value, would be something like, "We have conclusively shown that blood-letting by leeches is not an effective treatment for fever." A failed result, on the other hand, would read more like "We were unable to conclusively determine one way or the other, but here's the method we used" You could certainly publish the former (back in a time where that wasn't already accepted fact in the scientific/medical community), but it's unclear how you'd apply that to the patent (or even market) realm. You can't patent "stopping doing something".
refurb 12y ago
It is kind of surprising actually. Scientists create more wealth than managers. Creation of wealth only plays a role in salaries in the sense that you can't pay someone more than the value created overall. Supply and demand is really what drives salary.
- AnthonyMouse 12y ago
  Supply and demand sets the price of everything. You're just restating the fact that scientists don't make a lot of money. The interesting question is why there isn't more demand for scientific research when the returns are so high. Clearly it isn't that the market and society have no desire for additional scientific progress.
  - sokoloff 12y ago
    The returns for genuine basic scientific breakthrough can be very high. They also are very rare, and tend to create financial payoff only after a decade or more.
  - eli_gottlieb 12y ago
    Hyperbolic discounting makes decades-scale scientific projects "unwise" from a private firm's point of view: many private firms don't exist in the same form across 40-year time-spans.
Tycho 12y ago
Somebody already has. They're called Renaissance Technologies.
throwawaykf05 12y ago
>Scientists create more wealth than managers [Citation needed.] While I completely agree that progress in science creates much more value than efficient management, a very small fraction of research efforts actually yields any useful results (as you mention downthread). Abstract value is different from wealth. Even assuming that value translates proportionally into wealth (a huge assumption, considering that commercialization itself of scientific advances is risky and often far into the future), how can you even try to consistently determine the wealth an average scientist creates? This is why science is like the startup game that VCs play. Invest a pittance into people who see promising and hope one of them turns out to be the next Google. Of course, despite the immense wealth a Google creates, all the non-Googles get nothing.