October 7, 2020
How Crisis Accelerates Technology Change
Arun Sundararajan
Professor of Entrepreneurship, New York University
Marge D'Amico, Introducer, and Arun Sundararajan
Minutes of the Fifth Meeting of the 79th Year
The meeting was held virtually by Zoom with 132 members and guests in attendance. President Stephen Schreiber presided. Marue Walizer read the minutes of the previous meeting. President Schreiber announced that David Atkin had a guest, Edward Atkin. Marge D’Amico introduced the speaker, Dr. Arun Sundararajan.
Dr. Arun Sundararajan is the Harold Price Professor of Entrepreneurship and Technology at New York University’s Stern School of Business. The title of Dr. Sundararajan’s talk was How Crisis Accelerates Technology Change. Dr. Sundararajan received a B. Tech. in Electrical Engineering from the Indian Institute of Technology Madras and an M. S. in Management Science and Ph.D.in Business Administration from the University of Rochester. His scholarly research analyzes what makes the economics of information technology products and industries unique. His research papers illustrate how the economics of information technologies warrant new pricing strategies, and a deeper understanding of network structure and dynamics.
Dr. Sundararajan introduced the subject of the relationship between crises, and technology change by citing historical examples that occurred in the lifetime and within the memory of many of the members of the Old Guard. Both were spawned by the crisis of and the technology needs of World War II. The first was the Manhattan Project with the goal of creating a weapon using the energy released in a fission reaction with several orders of magnitude more destructive power than conventional explosive weapons. Success required advances in chemistry, material science and physics. The second was the development of the first general purpose stored program computer at the Institute for Advanced Study under a project that started in 1941. Until the development of the programmable digital computer, all computers operated with preprogrammed hardware that was designed for a specific purpose. The desktops, laptops and the ever-present cell phone all owe their existence to this general- purpose programmable computer. Other examples cited were social changes that provided the impetus for technical advances such as women entering the work force in great numbers and the returning veterans moving to suburbia following World War II.
A current crisis that is impacting many aspects of our lives is the COVID–19 Pandemic. It has been and will continue be the forcing function for many technological and societal changes. The technological area includes the multi-billion-dollar effort by the US government to develop a cure and vaccine for COVID–19 as well as projects to develop ventilators for hospital use that are less expensive and easier to manufacture than existing machines. The societal changes include the many changes in our daily routines, the use of social distancing and the wearing of masks to minimize the possibility of acquiring or spreading the virus. These in turn have led to dislocations in the labor market such as the ability of many professional employees to work from home, software for socializing, and the desire of many urban residents to relocate to suburban or rural areas.
Dr. Sundararajan pointed out that the foregoing societal and technical changes are producing major effects in retailing by accelerating the loss of many brick-and-mortar retailers and the growth of Amazon as a global marketplace of buyers and sellers, and the disruption of dine-in restaurants and the growth of restaurant takeout delivery services such as Uber Eats. He suggested that in the future these trends may extend into travel and tourism
A lively period of questions and answers moderated by President Schreiber followed Dr. Sundararajan’s talk. In response to a question on the survival of local businesses, he said he had hopes for the survival of local businesses serving local customers using digital platforms. In commenting on a question about income inequality he suggested that the measurement of income inequality may change in the future to a measure of the ability to purchase those things that are important in our lives. For example, transportation on demand may be more important than ownership of a car. He closed by addressing a question of congressional regulation of big tech, saying that government was a step behind in understanding the effects of technology, that the relative power of government to regulate was low, and that he expected more monopolies in the tech sector in the future.
Respectfully submitted,
Bernie Miller
Dr. Arun Sundararajan is the Harold Price Professor of Entrepreneurship and Technology at New York University’s Stern School of Business. The title of Dr. Sundararajan’s talk was How Crisis Accelerates Technology Change. Dr. Sundararajan received a B. Tech. in Electrical Engineering from the Indian Institute of Technology Madras and an M. S. in Management Science and Ph.D.in Business Administration from the University of Rochester. His scholarly research analyzes what makes the economics of information technology products and industries unique. His research papers illustrate how the economics of information technologies warrant new pricing strategies, and a deeper understanding of network structure and dynamics.
Dr. Sundararajan introduced the subject of the relationship between crises, and technology change by citing historical examples that occurred in the lifetime and within the memory of many of the members of the Old Guard. Both were spawned by the crisis of and the technology needs of World War II. The first was the Manhattan Project with the goal of creating a weapon using the energy released in a fission reaction with several orders of magnitude more destructive power than conventional explosive weapons. Success required advances in chemistry, material science and physics. The second was the development of the first general purpose stored program computer at the Institute for Advanced Study under a project that started in 1941. Until the development of the programmable digital computer, all computers operated with preprogrammed hardware that was designed for a specific purpose. The desktops, laptops and the ever-present cell phone all owe their existence to this general- purpose programmable computer. Other examples cited were social changes that provided the impetus for technical advances such as women entering the work force in great numbers and the returning veterans moving to suburbia following World War II.
A current crisis that is impacting many aspects of our lives is the COVID–19 Pandemic. It has been and will continue be the forcing function for many technological and societal changes. The technological area includes the multi-billion-dollar effort by the US government to develop a cure and vaccine for COVID–19 as well as projects to develop ventilators for hospital use that are less expensive and easier to manufacture than existing machines. The societal changes include the many changes in our daily routines, the use of social distancing and the wearing of masks to minimize the possibility of acquiring or spreading the virus. These in turn have led to dislocations in the labor market such as the ability of many professional employees to work from home, software for socializing, and the desire of many urban residents to relocate to suburban or rural areas.
Dr. Sundararajan pointed out that the foregoing societal and technical changes are producing major effects in retailing by accelerating the loss of many brick-and-mortar retailers and the growth of Amazon as a global marketplace of buyers and sellers, and the disruption of dine-in restaurants and the growth of restaurant takeout delivery services such as Uber Eats. He suggested that in the future these trends may extend into travel and tourism
A lively period of questions and answers moderated by President Schreiber followed Dr. Sundararajan’s talk. In response to a question on the survival of local businesses, he said he had hopes for the survival of local businesses serving local customers using digital platforms. In commenting on a question about income inequality he suggested that the measurement of income inequality may change in the future to a measure of the ability to purchase those things that are important in our lives. For example, transportation on demand may be more important than ownership of a car. He closed by addressing a question of congressional regulation of big tech, saying that government was a step behind in understanding the effects of technology, that the relative power of government to regulate was low, and that he expected more monopolies in the tech sector in the future.
Respectfully submitted,
Bernie Miller