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Science and Economics
Prof. Vassil Manov, D.Sc.
The author of this article shares his concernsover the inadequate attitudes to the science rampant in Bulgaria. These concerns have dictated the form of this publication, as well as the thesis developed and argumented in it. First of all,the author’s viewof the mission of science is presented– to find the reasonable way for the practice, for the practical actions. This mission is valid forevery branch of the science, including the economic science. But if in all spheres of human life (outside the economy) this mission is accepted as completely natural, whereas in the field of economy things are different, especially in Bulgarian conditions.
Unfortunately the common situation in Bulgarian is that the publications on an economictopic most often simply provide an explanation of the processes underlying the economy; only in rare cases are attempts made to outline a vision for the future of this economy, and propose ideas for improving economic practice. In other words, there is a well-established tendency of mismatch between economic science and economic practice. The author argues his own viewto overcome that discrepancy.
The increasingly central role of the science in social development and the establishment competitive advantages is a key argument. More specifically, the article reveals the role of science and innovations as a tool for the establishment of competitive advantages. Next, the logic of development in all spheres of life is stressed; and requirements that this logic poses to the relation between fundamental and applied science. National science is a key prerequisite for the development of each country is another central view. The connection between science and objective tendencies in technological and structural reorganization of the economy is revealed. The mechanism of the advance of science innovations and the advance of technological and structural reorganization of the economy is analyzed and revealed. The thesis that the financing the science and science researches costs much to each country but their non financing costs much more is grounded. At the end is shown the author’s opinion about what the future of science in Bulgaria needs.
Key words: science, economics, increasing role of science in the development of the society, innovations, competitive advantages, the interrelation fundamental – applied science, technological and structural reorganization of the economy, financing the science and science researches.
JEL:
Different forums, in which the author has been the participant, on the topic of the present publication and on questions related have been carried out. In 2004 for example, a conference and a seminar took place. On the other hand, the topic of the publication is developed expensively and deeply in the literature. In this situation, it is inevitable to ask oneself the question: “Is it possible to add something new to the topic, is there a sense in making publications on this topic?"
The categorical answer of the author to the rhetorically asked question is: there is such sense and the main argument for such a conclusion is the inadequate attitude to science in Bulgaria, which has been ascertained again and again in such forums, including those in 2004. Is this inadequacy a result of a misunderstanding of the role of science for the development of the economy, is this the incorrect idea about how the development of the economy can be "fed", or is it some other reason, anyway, this inadequacy is present. What is happening in the country, the openly stated or hidden ideas with respect to science are a fact, and an alarming fact. This fact shows that it is necessary to more frequently ring the bell about the role of science and about the inadequate attitude of the government institutions and of society towards it.
There is another alarming issue, disturbing the author for long time. This issue is related to disparaging and inadequate words about theory, about fundamental science. It is even more alarming, when such words about fundamental science are said on forums about science. You can hear many appeals that we shoulddiscard fundamental science and take uppractical action and pragmatism. These appeals are in complete discrepancy with real life, the so called real practice. There is no practical (production) activity, if practical activity is viewed only as production activity no science (knowledge) underlies it. No matter whether this practical activity is growing tomatoes or grapes, or manufacturing television sets, etc., there is not a single one that could be carried out and be effective without the necessary knowledge.
To people, who are calling for practical actions and who are labeling themselves pragmatic, it would be useful to quote a popular example, which reveals the practical value of real science and knowledge. When Rene Descartes was in exile in Amsterdam, he received a letter from the Swedish queen, enclosing a kind invitation to come to Stockholm in order to be a founder to the SwedishAcademy of Science. Descartes accepted the invitation of the queen and, from Amsterdam to Stockholm, he traveled by ship – a state-of-the-art for its time. In line with the established tradition, every ship captain was to present his personal report to the queen on each of the successive trips of the ship. The confessions of the captain of the ship, by which Descartes had traveled, about Descartes himself, were amazing. The captain of the ship admitted to the Queen this had been the most interesting voyage in his long sailing biography. And most interesting was what the captain had learned about navigation from his conversations with Rene Descartes that took place on the deck of the ship – it turned out that he learned more from these conversations than he had learned about navigation during his forty-years sailing practice. What is amazing in this case is that Descartes had never navigated a vessel (i.e. he had not dealt with navigation practically), but he had discovered amazingly the practical essence of what the captain of the ship had been doing for forty years.
It is not by accident that at the entrance of Louis Pasteurclinic, an inscription was placed, saying that there is no fundamental and applied science – there is only science and its practical application. It should be emphasized that it is not possible for real science not to be practically oriented and useful. “There is nothing more practical than real science” wrote the thinker of the millennium, Karl Marx. The concern expressed so far with regard to attitudes to science typical ofBulgaria has provided the architecture of the publication, and the theses that have been developed and defended.
1.About the mission of science
The mission of science is to reasonably clear the way for practice andpractical action. This mission applies to any branch of science, including to economic science. However, if in all fields of human life (outside the economy) this mission is accepted as something quite natural and uniquely correct; in the field of economic science, however, things are not perceived in the same way, especially in the Bulgarian environment.
Unfortunately, in the average Bulgarian case of practice, publications on economic topics most often only explain processes that are under way in the economy, and only seldom are attempts made to trace a vision of the future of this economy, to propose ideas on the improvement of economic practice. In other words, there is a rising trend of a growing gap between economic science and economic practice. On the one hand, economic practice is not interested in economic science, in the assistance that economic science is able to provide. On the other hand, economic science does not take the necessary steps so as to contribute to economic practice. In the average Bulgarian case, the representatives of economic science have adopted of passive approach to economic practice – the role of observers, or in the best case – of commentators of the economic processes under way.
This above-mentioned gap is to a certain degree natural, for it isthe result of the different objects of economic science and of applied economic policy. The applied economic policy always represents the interests of the leading political force; these interests have always had a narrower object in comparison with the object of economic science. It is precisely this difference between the object of economic science and that of the economic policy of a specific political force that determines the conclusions arrived at with regard to the economy, the evaluationsand decision-makingproposals made.
Furthermore, during the years of the totalitarian period, there was a notion consistently held: the road to the truth laysomewhere between political forums and universities, and the mission of economic thought was to explain and make popular the economic policy of the leading political force. Unfortunately, the deformation that resulted from this manner of thought has not been overcome yet. Even more unfortunate is the fact that during the years of transition, the wrong idea about the road to truth has been held up and “enriched”. During this period again, as the average Bulgarian case shows, the publications on economic topics have been apologetic in nature. They have been explaining and still explainthe righteousness of the ideological clichés, they have been “justifying” and still “justify” the latter; hence economic publications have beenconsidered as being subservient to clichés of the economic policy in place. Accordingly, publications on economic topics have departed from the mission of economic science and its social function.
The task of economic science is not only to explain the world of the economy, not only to interpret this word. The true purpose of economic science is to serve positive change in the economy. This means that economic science should be able to propose a vision of the future architecture of this economy and a vision of the ways and means by which this architecture should be built in the economic reality. The greater the awareness of the futility of the apologetic function is, and the deeper the understandingof its true function, the more successful the development of economic science and economic practice.
More and more often does economic science have to explain in a systematic and consistent waythe benefit political forces could derive from it. And this benefit lies exactly in the fact that the object of research is much wider that the object of the economic interests of any political force. For this reason, the political force would have the opportunity to impose its ideas on economic policy against wider interest background. Economic science will be also useful because the evaluations it makes and conclusions it draws with regard toeconomic and social processes would be different from the ones of the respective political force. In addition, if the political force is wise enough, it will not pronounce anathema upon economic science, but will putmore effortto do research so that it is able to enrich and rationalize its economic policy.
Bulgaria is entering categorically an age, where political success isincreasingly dependent on its ability to foreseeits future policy not from the perspective ofnarrow political interests, but rather the interests of the nation and country as a whole. And the only agent, which by definition is dedicated to work from the positions of a nation-wide interest, is economic science.
Science cannot be made obedient, as it deals with an unbiased study of facts and trends. As such, it is bound to be the most serious opponent of authority. For this reason, authorities’ attitude to science cannot and should not be shaped merely on whether scientific conclusions from the research on various processes coincide with the findings of the official authorities in power. The gap between scientific conclusions and the findings of the authorities does not necessarily presuppose an incorrect attitude of science towards authority and still less a hostile one.
This gap can help authorities eliminate hidden barriers and traps, if additional analyses andattempts for a wider vision of reality are made. What is significant is that whether authority should make use of science is by no waydependent upon laudation on the part of science to authority, or the uncritical confirmation of political findings, or its acting as an echo of authority. The real benefit that authority can derive from science is based on an unbiased analysis offering scientific conclusions and arguments, even if they do not coincide with vision of the authority.
For quite some time now life has proven the devastating nature of arrogant behavior. This is particularly true for the arrogance of authority to science as something unnecessary and redundant. On the other hand, there is no point in science considering authority as incapable of understanding the language of science.
Bulgaria’s economic development needsa close interaction between authority and science not arrogance. Understandably, economic theory can never be fully implemented in real life, neither can economic policy fully meetthe requirements of theory. And yet, a theory that does not take into account practice is inapplicable. On the other hand, practice that has nothing to do with theory will neverachieve its objectives even partially.
Based on this view ofeconomic science’s mission and role, the author of the present paper is now presenting his ideas, assessment and conclusions with regard to the role of science in the development of society and in the building of competitive advantages for a country or an international community, and the necessity of radical change in the attitude of government authorities, political forces and society as a whole towards science. The author of the publication hopes that these will provokedeeper thought on the part of politicians, heads of state and businesspeople and will make them adopt a more professional and responsible attitude to their own ideas of the future of the Bulgarian economy and science.
2.Science and innovations – an instrument for creation of competitive advantages
The future of Bulgaria and any other country depends mainly on their success in the field of innovation. After all, development translates into new products and new technologies. It is not accidental that historical ages are differ not so much in what is produced, but mainly in the way it is produced, and the technologies usedin production. If Bulgaria wants to be in the avant-garde of human progress, and there is a pressing need for the country to reach this place, in line with the Lisbon Strategy requirements for the EU development– as expected, Bulgaria will become a EU member on January 1, 2007 - one of the conditions for the country is to be a leader in innovation. The need for such a leadership position is determined by nothing else but the essence and role of knowledge in the process of innovation in a broader sense of the word.
As Henri Ford said, it is impossible to do only what you no nothing about. Knowledge is the wayto increase the potential of the factors of production, including the human factor. Economic (and, more generally, human) activity has always been performed and is still performed in the conditions of scarce resources and limited opportunities. These limitations are not absolute: they are only relative. This relativity is determined by the know-how and knowledge. As long as knowledge is developed, there are greater opportunities for every human activity, including economic activity. Human history as a whole has proved of this simple truth. It is for this reason that the future of Bulgaria as a part of unified Europe has its roots in its capacity forinnovation and its ability to benefit from the world of innovation. Every country and community is ‘doomed’ to both generate know-how and to be a consumer of it.
This trend has always underlain human development itself. On one hand, striving towards self-expression is genetically intrinsic for any person. On the other hand, striving towards welfare is also genetically intrinsic to humans. In this way, if the striving towards welfare is superposed on the striving towards self-expression in such a way that welfare directly depends on achievements, on the standards, achieved by him/her in the domain of creativity, then a natural result will be any individual’s success, as well as that of society as a whole. A similar situation can be seen in sports: development is nothing else but making records and then breaking the attained records in the sense of achieving higher standards. And, as it has been already mentioned, these standards have as there final material embodiment the new product and the new technology.
A cause and effect relationship has always existed between science and economy. In this sense, the development of the economy has always been impossible without the development of knowledge. And the development of knowledge has been more successful when the economy was in need of this knowledge, placing orders for development of knowledge. In other words, the stronger the signals addressed by the “stomach” of the economy towards science, the faster the development of knowledge has been.
This dialectical functional relationship between the economy and science, characteristic of all stages of the development of society hitherto, is so strongly expressed at the present stage that the thesis about the transition to the economy of knowledge is widely accepted.