Transcripts For CSPAN3 Lectures 20240703

Okay, lets get started in this second half of the material. Were going to be discussing mass production and the american system of manufacturers. Now as you well know. There are differences in the way economists and historians discuss issues in particular. I would sort of say historians plays a great emphasis on archival information descriptive statistics and testimony that was contemporary to the time in contrast social scientists, especially economists look very much for big overarching themes or a framework that will connect it together and sometimes that means ignoring the the details of the specifics of historical events are involved. And what were going to try to do is to try to bring both into today by looking at a debate or rather a literature on mass production and the Assembly Line. That as articulated by economists, but then using that framework to think about the issues by using an examples a couple of the major historical transformations in several industries in particular. Were going to talk about both the firearms industry as well as the typewriter. Now one of the things we should probably first talk about is something called the american system of manufactory that is in the 19th century writers towards the end of the 19th century started using the term to refer to mass production as it developed in the United States, although of course in the early phases of that development. Nobody actually used that term but there was also an awareness throughout the early part middle of the 19th century that the United States was developing along slightly different lines than britain in particular. Theyre emphasis on whenever possible assembly in mass production. And although as we know that term today a lot of what were going to discuss barely qualifies as mass production. But of course we are going to talk about now the growth of that of that era and talk about the ways in which the Assembly Line. Both built up and changed moreover. Were going to talk about the economic characteristics of things particularly the nature of demand the ratio of capital labor that affect the adoption or nonadoption of mass production we first need to realize. That when we think about mass production, were thinking in its ideal form of full automation of the manufacturing process. Right, and i think there used to be cartoons in the 60s or 70s. There may be some now in which people think about you know, the hypothetically what is mass production. They think the future Somebody Just presses one button and everything from the the corn or the material or the steel or the Raw Materials are picked up from something and robots push everything through through the outlet and even robots load the ships the ships are, you know piloted by robots all the way to your home. Of course, thats not the way it works. So even today we dont literally have full mass production. However, weve come a long way relative to its beginnings in the early 19th century. And in particular what i want to talk about is i want to talk about the challenges faced by people engaging in math production both at that time and to some extent today in industries that are hard to to convert to mechanization. In particular lets think about we can break down this question of mass production into four general categories. The first is the Assembly Line itself. The very idea of the Assembly Line was of course enacted in primitive forms in many small workshops and stuff, but when we consider that idea today we think of a system in which the assembly or the production of a product is based upon different groups or individuals or teams working on specialized portion . Of the production which are then inputs or which are then combined with other inputs other processed intermediate inputs from specialized groups which are then recombined into the final product. Thats what we mean by the Assembly Line. Right, and thats distinct that notion of the Assembly Line is very different from for example the second issue which is the mechanization of the process. The Assembly Line is something that became much bigger in american and britain which was the beginning of the Industrial Revolution mechanization, of course was something that the british pioneered in terms of things like the whole idea of the steam engine itself as well as the various machines used to improve both cotton spinning and weaving this is part of the mechanization process. For example early automation didnt necessarily mean the machine did everything but the machine engaged in multiple movements or multiple processes that it might have taken dozens of people to do but instead now a single worker by simply running the machine. Could engage in production of things that multiplied the potential for the human labor to a much bigger set of output and notice that the reason you separate it is that you can have an Assembly Line without mechanization. And of course in the extreme case with robotics, you know, you can have mechanization without the human Assembly Line, but you have a Different Assembly but the idea is that usually its easier to get the Assembly Line before you get the mechanization. Although the more mechanized you are the easier it is to have an Assembly Line. Third we can think of the importance of the creation of homogeneous parts for assembly. Right so that england had the great deal of mechanization in the early phase of the Industrial Revolution, but these were not always producing homogeneous intermediate parts that could be assembled together. And the holy grail of homogeneization is full interchangeability. As we will see. These did not come easy and in some sense never really fully came about. Till much later than this period but the point is that this period was the beginning of the attempt. To have mechanized Assembly Lines. That led to homogeneous parts which then were somewhat interchangeable. They were never fully interchangeable in many industries, but that partial interchangeability lowered the ratio of human labor to machine labor. And fourth and finally, theres a goal of the full Machine Assembly of the final part. Think about the fact that even today what we think was relatively simple production say potato chips still needs a human as youll see if you look at documentaries online a lot of potato chip factories still have people who stand there when the potato chips come out before they enter in the bags and their job is to look at ones that are burnt or undersized or particular broken and like throw them offline. Thats something they could automate in theory, but they have found its cheaper to hire somebody. To do that process at the end of what is essentially a fully mechanized automatic process. So and ultimately notice that even that choice of having a person there in the final period before the packing of the potato chips essentially is about the fact that youre weighing the relative costs. Of machines which both involved the development of the machines the maintenance of the machines the testing testing of the machines and the continued use and you make a new machines. That will be performed exactly the same task. One of the big problems always faced by inventors, especially in the earliest part of the Industrial Revolution in late 18th century. The 1700s was the lack of insufficient polish and sufficient quality in parts so that they could be used together. And of course the previous issue the problem interchangeability. You can guess was a very big issue for which industry what industry is a very big thing . What happens around the 1800s early 1800s . Real no, the big catastrophic event that everybody worried about. No, no event. Not production. Who was around after the french revolution . Napoleon then the polyonic wars then the paleonic wars were very important right and they involved huge armies far beyond the scale of wars in the 17th and 16th century. These are gigantic armies. Involving often conscripts or volunteers which were of a scale that what had not been seen, you know, since roman times perhaps and perhaps never seen before the huge scale and maybe the only thing just to compare them with me, maybe some of the struggles in asia particularly those involving the chinese empire and say the mongols and one of the bugaboos of that period of the napoleonic war was the interchangeability of parts. For example, even with the early steam engine people took for granted that there would be a lot of final fitting parts didnt always fit together nails were not uniform. People often had the machine and they had to sort of bang it together. Even if its sort of work. They had to constantly be tinkering with it to get it to work all the time. Were so used to cars that rarely break down today that we forget that even as late as the 60s and 70s most cars were really unreliable. You had to bring him the shop very often. Against that fact however cars in the say 50s and 60s were more purely analog there werent these digital parts to worry about so many of those things were easy to work on by people who were mechanically inclined at home. But this is the way almost everything was even more. So earlier on when every machine had to be adapted moreover when your machine broke down, you have to accept the fact that when you bought a new part. You had to be able to work with that part to get it to fit right and you couldnt simply take another machine. That was not broken or a broken machine in cannibalize it for parts and use it on yours without quite a bit of wood or metal work. So these things were part of the issues people worried about and in war this was a really big deal because one of the basics of war is to apply arms so that the polyhonic wars you start to seeing arms really used in mass quantities, but the problem you have is many of the guns were very different and so what you have problems that even though the basic design of the gun is very simple the parts were not at all interchangeable. There was neither harmonogeneity nor interchangeability of the parts and this is one of the areas in which the us pioneered so i want to talk about that. Behind this of course at the background considerations which include labor and Capital Markets with the overall capital equal to the labor ratios. Driving a lot of the adoption right you would expect for you for example even today in many countries where labor is very cheap. Its often easier to hire people to perform parts of the menial tasks in contrast in high wage economies like you see in the United States or western europe. Things that in other countries should be taking for granted. Why did i just get somebody to do it . Its easier to create the machine. And remember that machines often started out by being less. Effective at producing things than humans that is early machine created products tended to be of lower quality. It is only later as the machines evolve and become more specialized the precision and uniformity that can be created with machines allows you to produce things that are far more reliable and in certain things get Higher Quality in other things humans are still better. So for example, take Something Like for all the accomplishments of machine processing. Right ocr systems dont work very well yet. You still have a fair number of errors when youre scanning books. And in order to make them clean you actually have to pay a human being to look through them and correct the ocr errors a machine makes right. I remember when in the early 90s people said oh another 2025 years. This will essentially be perfect. Its 20 25 years later. Its not perfect yet. Not by a long shot right. So these are the kinds of things in which humans still have a major advantage relative machines. Nathan rosenberg in particular looked at this literature. And was one of the ones to look at the system of manufacturers in america from the standpoint of thinking about the diffusion of process. One of the things we dont realize is that the diffusion of process may be as important as the inventions within the industry itself. In fact rosenberg claims the really big innovation of the 19th century was not the steam engine nor the railroad nor any specific product, but rather the system of Machine Production and the way in which the leading economies of the world generalized from that they use the processes to make other things. So for example, were going to look at the way in which firearms developed and became more refined in the processes and over time those processes became so generalized that many of their systems could be used to make things like typewriters. Indeed rosenberg who studied a lot the problem of development in the third world. Often stress the fact that the third world was not always ready these countries that were poor and less developed. Either because of policy choices or unwillingness were simply unable to adapt a lot of you as technologies or western technology in general one of the most naive things about the postwar era particularly in the 1950s was the belief that all poor countries needed was help with financing and capital and you know, how but it turns out know how its very difficult to transfer. You see today that even in china you many of the things that are outsourced to their you know, things like made by say the iphone or something that are often considered to be better made in chinese factories run by us managers. Then chinese factories making similar phones run by chinese managers. Part of that is because the whole package of goods and services that go into. What is a modern tool or a modern product often involves things that are outside the simplistic manufacturing requirement. So today we take for granted a lot of the product is the look the design we care about the warranty we care about the nature of Customer Service we care about the guarantees of ontime delivery the network of suppliers. All these things are part of that innovation. Well in the 19th century much of what you were seeing . Was an attempt to get one of the four pieces. So lets write them on the board so that we recognize them. All right, so were talking lets just simply called Assembly Line. Second were going to talk about mechanization. Third homogeneity leading to a degree of interchangeability and fourth final assembly so rosenbergs claim is that Machine Production and all the accompanying support products of Machine Production in particular measures propaguges power measures proper tools in some sense for measuring and producing copies of other tools. Is part of what allowed for a rapid diffusion in the United States of these growing manufacturing techniques . And also were going to talk about the difference between government demand for product and private department. Private demand is could either be more or less demanding of quality then then the government demand the government has specific political purposes. They have such as winning a war or needing something for policing or needing something for the building of certain types of structures. These are very specific and they are less driven by Market Forces and more by Political Forces than the private market where the private market is going to balance out what the consumers tastes are with what they can afford. And it makes a big difference whether youre selling to a mass market or whether youre selling to highly specialized market. Well talk about that in a second too. And so were going to talk about the firearms industry because thats a lot of where the earliest Assembly Lines that were successful were seen. You saw people like ili with eli whitney claimed to have engaged in mass production techniques early, but in fact, he didnt really do that for the most part as most of his stuff was still very much hand made. He claimed to you know, he his work with other a variety of products including the firearms things that he had often claimed a pioneering success in the Assembly Line, but in fact most historians now say most of his ideas were buncombe and of course, i will see here. There was a tendency for successful american manufacturers to exaggerate the extent to which they had succeeded in creating a functioning Assembly Line, even the ones we now see who are relatively successful. So the first thing were going to talk about is firearms, but before that we need to review what is goes on into a firearm. Right and the two most common firearms that had to be produced are rifles and handguns. In both of them you need a barrel you need a means of loading the bullets. And you need a trigger action mechanism a mechanism that allows you to fire. The bullet so that it is charged and sent off. Furthermore the bullet itself is very complicated. Right early on the bullets were mostly a system of putting powder inside the long rifle barrel and then putting a ball that was dropped into it. That was a little bit tight and you jammed that ball. Into the musket into the barrel of the musket and then you had what was called the flintlock that is you had the mechanism which struck a flint which then lit something which was easily combustible and that sometimes Something Like a stick. I mean, lets take a string say in oil or something, which is then transferred the fire. To the powder which exploded and fired the gun. Unsurprisingly, this was not very accurate very often early on but throughout the 19th century. Improvements were made in both rifles and handguns. And for example the rifle. Eventually developed rifling into which we use for handy. I mean right the united to say youre using grooves that go through the bore of the rifle which are used to spin to the bullet. So that they are not the bullet is not destabilized the creation of the conical ball. So for example the balls that look like this and early ones were like this by minier. In europe became essential because they were much more accurate than the simple round balls that being used earlier. In fact the medieval which in america was known as the mini ball. The mini wall was very in some sense essential to the civil war part of the many wall and the improved rifling and improved muskets are part of what made the civil war vastly more if you like sanguinary it was easier to kill people in the civil war that had been in napoleonic times. Very often in napoleonic times you had to come with quite close. Before you got reasonable hits with their system of rifles and that allowed you to charge people in contrast by the civil war one of the things people learned was that rows of muskets alternately fired. One row at the time was almost like machine fired was like a rolling machine gun, except it was just different rows of men firing that would often stop. People marching up to you in at speed. Before they even got within a hundred yards. This is why you got many charges to uphills or Something Like the famous pickets charge which led to very many deaths. But to get there. They had to figure out improved ways of manufacturing and demand who did a lot to push the Assembly Line for guns was someone who was working not in rifles, but in handguns and that man was samuel colt. Samuel colt interestingly enough was a kind of huckster. He had a lot of good ideas, but he always like to embellish his life. So its always hard to figure out which parts of his claims are true and false. So for example, he claimed he thought of the idea of a rotating cylinder while he was working on a ship for a year and some people doubt with thats true or not moreover. He was not the only one to experiment with the rotating siller when when samuel called developed his first firearm, which is known as the patterson called because it was main, patterson, new jersey. Samuel colt did not in fact patent the cylinder because he knew that was not patentable at that time. In fact a lot of what the patented was the way in which the cylinder fit in the gun and the loading of the bullet. You may not realize this were so used to thinking of the six shooter. As they later on something you just load six bullets and fire that the early patterson cult. Actually required you to load the powder. Into the cylinder and to load the bullet separately and then you had to put a primer cap a cap, which would ignite for each bullet in the gun. And in fact fully loading the patterson called was often quite cumbersome. Which white was not initially adopted by the us military that is you had to partially take open. Basically, take apart the gun before you could reload it. So it is true. They could fire several shots. But it was not as effective and it was very complicated. Called also the bad habit that the man he charged to design the actual creation of the gun that turned his ideas into an actual weapon was often not paid by cold. He was always stringing people along and getting into debts and doing things in fact early on he he used to create this medicine show. That is how did he support himself while he was trying to decide his first gun. He went around the country which chosen which he subjected members of the audience to laughing gas. And then while they were in the state have them do a bunch of tricks, so its totally different when you think of it and he always talked about how great his gun was and he made claims that he couldnt always back up. In fact, he went bankrupt he was he was about to close completely when he was very lucky because several of his calls were used by the Texas Rangers. When fighting native indians and they found that that was so successful and shocked the native indians because their normal made some attack was to expect. That the soldiers would fire one round and then take a long time to reload. So then they would charge him at that point, but then facing a whole group of Texas Rangers would repeating firearms. Was something that was a shock to them because now these people without reloading were just recognized the hammer were basically to able to take six shots within a minute. And so much so that colonel walker. Push this idea and asked. The Us Government the ordinance to ordered these guns for the army and in fact call thats the beginning of called success and in fact, he promised to produce 10,000 guns when he didnt have a factory or any means of doing so so you had all these kinds of issues but cult was a very good hustler. And he eventually got to the point where he did set up his factory and he did promote the idea of the Assembly Line. So he was able to use the idea of having different groups on the assembly one of this claims. Which is now shown to be false was the claimed that his parts were completely interchangeable. So one of the tricks he liked to do is to take say a bunch of handguns that were identical at least their same model and then take them apart and then mix up the parts and put them together. And so one of the things that the british saw when he was giving these exhibitions was the perception that cult parts were all interchangeable, but that turns out to be you can call it a liar. You can call it a slight exaggeration of the truth that is in practice. What he did do was create parts that were very similar, but while they were hot. They were then hand shaped and fitted to each gun. That is you can bet therefore that the parts that he brought along the demonstrate interchangeability. Were carefully for hand finished to make sure they were interchangeable but called could not guarantee in fact to the end of his life. That the parts that he called interchangeable were in fact interchangeable to the standard we would talk about today. Now of course part of the reason for that, is that the demand for interchangeability in military firearms. Is of a much higher standard you would get with consumer goods. To give you an alternative at a similar time as the firearms industry was developing. The early clock making manufacturers thats making small clocks for home use. Were making talks with a number of interchangeable wooden parts. But part of the reason theyre able to do this is the parts were much simpler to to machine and the standard of interchangeability was much lower. So that they produced low quality clocks, which werent all that accurate. But they were more than adequate for the home market if people wanting a general timekeeper, that wasnt as precise as the best handmaid say pocket watches. So these things were cheaper and they were widely popular among americans particularly in the middle classes. So you can think of you can see how different it is what the nature the demand is moreover. As time passed the Us Government and the british understood that interchangeability was not necessarily the same thing as homogeneity. And early on everyone started the Assembly Line thinking about it as saving money. But quickly the Us Government realized that interchangeability was a quality. They wanted in a final product for its own virtues, even if it cost more. Because very often the Assembly Line to the extent it required a great deal of skilled hand finishing. Would often cost more both in terms of setting up the machine shop hiring people training them etc then doing everything by hand, but it had the advantage it could make things more quickly. And then interchangeability was something they aimed that they hoped in the future would be the case and they wanted it so much they were willing to pay in the hopes of getting something interchangeable, but it took many decades before they even came close to that. British noted that american guns made an Assembly Line were more uniform but of lower quality than british guns. British guns throughout the 19th century were more carefully finished and they were done by hand part of this was because britain didnt have a big war after the crimean war. Up to world war one so what do you think was the major demand for guns . In the uk in the 19th century. Hunting or sport . So the two things are people shooting clay. Skip this kind of thing, right so using for hunting and shooting moreover. These were often demanded by the higher classes. Not the lower ones and so they paid for a lot of things that were not essential say to a military weapon. They didnt they they wanted something was more than milk spec. They wanted embroidered or you know in you know what you call this elaborated designs on the barrel or on the stock or things like that a lot of fine wood fine finishing. Right smoothing out of the barrels. These things are things that are very much a highend demand factor. Actually you see some of these things today, too. Um one big difference for example, is that if you look today the us has the most open laws. Particularly in about half its states for gun ownership so gun ownership is widest in the us than in any other country in the world. That means the us market is predominantly a mass market, even though the military is a big buyer weapons and ammunition the bulk of the demand for guns in the United States both handguns and rifles. Are people who are not very demanding. They just wanted to go bang and be pretty accurate. As a result what you see is this bifurcation in the United States where the big manufacturers make guns that are pretty good. And you have these very small custom shops making guns for things like competitions to very high existing exacting product. But at the very high cost in contrast europe gun demand is much more limited. The most countries essentially ban handguns or make it very difficult to get handguns. Or are only allow rifles that are not military and purpose but primarily for sport. So for target shooting or for hunting as a result, their demands are higher in and so that their average finishing is much higher even their ammunition. For example, the only firearms still allowed in the olympics. Are those shooting the 20 small rimfire 22 caliber bullets. And most if not probably i would say all the best bullets that are olympic. Quality are made in europe. Either england or the continent no us manufacturer makes 22 caliber bullets that are high enough standard. To be used in target competition whether in the United States or abroad that is most of the bullets for the us are primarily used for plinking and shortridge hunting. That is the most common use. Is that either just shooting at the range for fun or youre using it to say shoot squirrels or other small varmints and so thats a very different market. In fact one us manufacturer tried to make highend bullets several years ago one of the largest cci and they actually closed it down because they found that the costs have been doing this. Were just not worth it in the american environment. That is the rate of return dairy getting further capital did not justify that investment. So that we see with the cult that sam will call was able to make improvements over time in the guns, but they he had to in some sense half invent a lot of things. So he was very good at marketing which people didnt think about he was very good at developing factories that he was very famous for his factories in hartford, connecticut being early places in which you have the paternalistic system. There were there were rudimentary recreation facilities for them. There was an attempt to provide schooling for many of the young girls who worked there. There was an attempt to sort of internalize the externalities of the labor market by keeping everything within a town that was growing rapidly and where business would come in. And during the civil war for example, he faced the problem. That initially he sold both the north and the south. But then fearing the bad that this would look bad. He stopped selling to the south. Its not unlike what you see today with ukraine war where you know, she royal and the shell royal dutch shelled actually bought one of the shipments of russian oil that couldnt find a buyer and now shell has been running around saying mia copa. Im sorry. Im sorry. Ill never do it again, and you can sort of see how thats more about public opinion. Then necessarily the ideas of the owners of those companies as well. So that in this case . The choice was the governments and indeed military drove a lot of the Early Development of guns. Its one of the but in the United States, it wasnt just the military just a civil war but that American Farmers needed guns to protect themselves in the west and to protect themselves when they were farming both against each other and as well as attacks from say native indians as well as from dealing with wild animals. So that these guns often develop to support the needs. Of American Farmers and ranchers so much so that many of the best weapons throughout the 19th century are America Everything from the data six shooters smith and wesson colt remingtons firearms the guns that were developed to be lever rifles like you see on cowboy shows. These were early attempts at early successes in getting multiple firing. Rifles the earliest rifles that shot multiple rounds were lever action and they continued to be perfected all throughout the 20th century. Perhaps the greatest arms designer of all time John Moses Browning. Lived and worked in the late 19th and early 20th century. John moses browning was an organ in utah and he and his brothers had a rifles shop and hes one of these guys it was at the time when you could still have a small workshop developed new ideas and send them off to the east coast. In fact, he went he sent one of his designs to the east coast the winchesters were so impressed that they actually came to visit ogden utah to see what was going on. And John Moses Browning was of course responsible for hordes of the most famous guns that ever but ever existed including the 50 caliber bmg machine gun that was used in world war 1 World War Two and still used today including the browning automatic rifle and most famous of all the cult 45 the 45 handgun, which is referred to by most gun buyers as the 1911 because thats when it was thats the model number of it and it was called the called 45. Its called made it but we think all the ones made by called as well as all the copies today are considered to are called 1911 in the 1911 is very unusual because it was one of the first handguns that could fire and reload rounds without any caulking full of you pulled because fully semiautomatic. Pulled the first shot and the rifle simply cycle out the old case and the new bullet came in. The us did not invent that system the germans or the austrians did so the early mauser and the luger were developed before the browning. However, the browning 1911 is the only weapon from that time period which is still in use today. By some militaries and Law Enforcement officers so it tells you about the quality of that design that he developed. But again all this would not have been possible without precise manufacturing tools. And the rise of a system for mass production that could both make large quantities which became essential for the military obviously in world war one World War Two and get them of high enough standard so that they became virtually interchangeable and were relatively reliable. In contrast lets look at Something Like the typewriter. You may what do you know about the history of the typewriter . For example what kind of keyboard . Lay out that we use today. Quirky do you know what people say about that why we have that qwerty keyboard layout. Originally, they laid it out like in alphabetical order, but people would get like when they type fast enough things would get confused so it would clog up a lot and thats just one the early stories. Although that now there are some people who recent scholars are questioning the authenticity of that claim what they really say happened. Is that the early typewriter was being used heavily by people involved in telegraphy more and sending sent that is to say post. Theyre sending telegraph messages out. And theyre typing with that and the things they had to type were heavily determining what worked better and so they were inputs into the development and spread of the qwerty system. It didnt hurt that the quality was first used by shoals. That shows invented the first practical typewriter there were a large number of precursor inventors who had a kind of printed type machine early on but none of them were viable at the individual level and not very economic. Shows who in was in wisconsin, milwaukee . Concert with glidden another industrialist. Built the first couple of hundred units and they were able to sell but they were very high quality units requiring massive amounts of hand finishing. So these were not at all mass production items. So much so that they found that almost all their prophets were being eaten up by the cost of manufactured. Given that the machine was popular, but given that they could not find a way to lower cost. They tried to simplify it but ultimately realized they needed someone with experience in Machine Tools. And Machine Production to make the typewriter. So what did they do . They approached the Remington Arms company . They crouched him Remington Arms company in the early 1870s and in 1873. They basically became. A part of the Remington Company and in fact, they had to deal where i think Something Like only one third of the prophets were to go to shows and his group. And the other twothirds are 60 were to go to remingtons for all intents and purposes remington now own this new typewriter design and its remington who came out with what they called the shoals glidden typewriter. Remington was also the ones who invented the name typewriter. Even those originally two words it was type dash writer. It was a separate words were separated by dash. So you had this term typewriter, which has since become commonplace. And so that that actually flourished and the manufacturing techniques that remington had perfected with making firearms. They found had real benefits in terms of learning how to simplify the typewriter design improving its reliability and still making it cheap enough to sell. Remember one of the in economics we distinguish between invention and innovation. Right a schumpeter points out invention is the mere creation. Of the initial device but the actual creation of the device for market. So that it becomes a viable product is what we think of as true innovation. That is for economists innovation is about the process of taking inventions and making them into practical product that has an actual market. And in that sense, its remington. Who did the first really good job would creating an economical useful and high quality typewriter. One of the ironies of the story is that remington was . Engage in a lot of mismanagement in the 70s and 80s so much so that it went into receivership at the end of the 19th century. But before they went into receivership, they sold off the remington. Typewriter corporations it became a separate company the remington typewriter corporation and that separate company is very famous because they started going into Office Machine products and that Company Became Remington Rand. And Remington Rand built things like the early some of the earliest large Computers Like univac. Right. So the univac system was produced by remington Remington Rand was later merged with sperry. Right, so it be under the Sperry Corporation and sperry eventually swallowed up and merged and changed its name to unisys. So you have this evolution from . Right a small typewriters typewriter maker attached to a giant forearms manufacturer evolving into Office Products in today being a major source of business computer systems. So you see the way this evolved and the typewriter as you can expect had very different demands. From that of the firearms remember that in all these cases we have to think about the fact. That you needed gauges. So one of the very first things samuel colts firms pioneered was the creation of precise gauges. So that you could measure. Carefully what the tolerances were of the products you were making so that you could see that they were within a certain kind of tolerance. And then later on remington made it a habit of having a model machine. When they were going to produce something that machine would always remain in one place in that model machine was used to make copies which were then the machines that were used to produce new products and you went back to the model machine when making new machines. Ultimately rosenberg points out the success of the United States in this was greatly aided by the fact that the machine the people who made the machines were initially the corporation themselves the company themselves, not the corporation the company. Right if they were making machines to produce guns machines to produce typewriters. They made them inhouse. But then they got to be creating a separate division or something attached to they had a makers of the machines attached to the company itself eventually these evolved into totally independent companies and the iron is that these companies were making machines for a general set of companies, but their specialization was making machines specialized for the needs of a particular company. So they were general Companies Making specialized machines. And if you think about that, what does this remind you of this whole process of going from inside the firm to outside and becoming a new market . What does this remind you of an economics . What theory we talk about institutions . Vertical integration and the theory of the firm right. What is the theory of a firm right remind you that wrong causes working the theater of the firm are about the fact that the firms are created when the outside market is not reliable or not efficient and therefore they have to make things inhouse and theyre making them things inhouse because theyre transactions costs of dealing with the market. Especially the market doesnt exist are too high. As the outside market grows as many more things can be outsourced in the market. Theres a more clearcut division between what things only they can make inhouse and what things are made outside. Ultimately these things feed into the general problem of the Assembly Line, which is still one of the issues thats coming today. Nathan rosenberg who talked about this in a particularly the role of Machine Tools was a professor at stanford and he was also quite influential in Silicon Valley in the early 90s in the early 90s a lot of people in Silicon Valley were trying to understand what parts of the business could you take in existing businesses and automate thanks to the internet. Verses what things could not be done. One of the things thats always debated for example is the extent to which video calls and phone calls can substitute for facetoface one of the things weve had experience with in this pandemic. Is that there are certain types of jobs where you can outsource certain types of meetings on the other hand or certain types of situations particularly. Where a lot of teamwork is required. And theres a lot of uncertainty and a lot of Fast Movement in which you actually need the teams to be working close together to get the optimal benefit of their innovation. These are still some of the products we grapple with today finally if you think about the role of mass production, which in many ways becomes its its peak. In the ford General Motors era thats when you get what we think of as mature mass production. Wed relative homogeneity and a very well functioning Assembly Line. We still have to realize now that most of what we buy is not the product. We are not paying when you buy meat in the grocery store. Youre not often paying for the meat youre paying for all the processes. To prepare cut way measure and package that stuff and then transported to the supermarket so you can buy it for your home. And a lot of that comes about because you have a system worldwide at least among the developed economies that is created a very good system for either buying outsourcing a lot of things they can buy from foreign intermediaries. Whether they be in china or elsewhere and combining them with things that are only made in house. Within a support and service and marketing system. That is also very well developed in the home country. Were going to talk some more about this and the issues of what things impede development. What things impede did Optional Technology next week or rather the week after the break when we will be discussing . Why was china not first with the Industrial Revolution . Thats it for now. Thank you. Tonight. I was Going Special program id like to introduce dave who is our own our board and also the chair, the program committee. Dave and i thank you all for coming this evening to our